Production at TAB Mežica gradually resumes, flood damage tops EUR 20m

The TAB Mežica group produces lead-acid starting and industrial batteries at its plants in Črna na Koroškem and Žerjav, lithium-ion batteries in Prevalje and conducts battery recycling in Žerjav. The Meža River flooded all the facilities, but the most hit were the facilities in Žerjav and in Črna.

"It is difficult to talk about the exact amount of damage, but at the moment we estimate the damage to equipment, inventories and infrastructure at more than 20 million, and we will have to see how much we will be able to compensate for in the next few weeks," TAB CEO Roman Burja said at a press conference after today's shareholders' meeting.

In Črna, where the flood clean-up will take a little longer than in Žerjav due to the extensive damage, customers can still be supplied from stocks built up before the floods, as road infrastructure has been re-established throughout the valley.

Production has already resumed on the higher floors that were not flooded, while full production is expected to restart in October.

Everyone who can be present at the company is currently working, either in production or helping out with the clean-up. In the coming weeks, however, it is expected that some of the employees will go on furlough until full production resumes in Črna, the CEO said.

The company, which employs around 680 people, welcomed the government's measures in the wake of the floods, assessing them as sufficient for now.

Burja also highlighted the solidarity and positive response from business partners, suppliers and others.

At today's shareholders' meeting, attended by 64% of shareholders, it was decided that last year's distributable profit of EUR 19.6 million will go into reserves. No dividends will be paid out, since the company received state aid due to the energy crisis.

Despite the crisis and the war in Ukraine, the company assessed its operations as successful. Sales of lead-acid batteries were down compared to 2021, but the consolidated value of the sales was higher. Lithium-ion battery sales were up last year.

In 2022, total sales revenue were up by EUR 33 million to EUR 293 million and net profit rose by EUR 3.1 million to EUR 19.6 million.

In the first seven months of this year, TAB sold EUR 154 million worth of batteries and made a net profit of EUR 12.3 million.

After allocating EUR 13 million for investment last year or EUR 28 million at the group level, TAB planned to invest EUR 16 million this year or EUR 29 million at the group level. Most of the planned investments were carried out before the floods.

Among other projects, activities are under way for automation of the production line for lithium-ion batteries in Prevalje, which is to be completed in November, so that production on the line could start by the end of the year or early next year. Currently 40 people work at the Prevalje facility, and the company plans to increase this number later on.

In June, TAB USA was founded. In the first phase, the company is to sell industrial cells and in the next phase, at the end of this year, produce them in the US.