Reka reports decline in rubber business on weakened demand

Aura, Finland – Reka Industrial has reported declines in the half-year performance of its rubber business, due mainly to uncertainty in the market and weak economy.

For the six months to end of June, the group’s rubber segment reported a 46% year-on-year drop in earnings (EBITDA) to €700,000, on 14% lower sales of €14.7 million.

The group, which now only consists of Reka Rubber – following the divestment of its cables business last year – posted a loss of €100,000, down from earnings of €38 million last year.

Group sales at €14.7 million, was considerably lower than €78.1 million reported in the first half of 2023, due to the discontinuation of the cables business.

Reka cited “the general financial situation and uncertainty in the markets” for the low order volumes and shortened order lead times of its customers.

The group expects the “challenging market situation” to continue for the rest of the year.

However, Reka said its rubber unit had a “strong position” in its selected market segments, adding that the unit’s market share is estimated to have remained unchanged.

Furthermore, Reka said it has received new customers, for which it is now delivering samples this year, with “actual deliveries” set for 2025.

Profitability was affected by decreasing volumes and the delay in transferring the cost increases to customer prices.

With the recent changes in the management of the rubber unit, Reka said it is seeking to speed up efficiency measures. (ERJ report)

Furthermore, the Finnish industrial rubber manufacturer expects to introduce profitable product offering and efficient production technology to enhance profitability.