The financial position and performance of the economic entities from the Light Industry

• Author: Baba M. C.
• Pages: 261-268

Bulletin of the Transilvania University of Braşov

Series V: Economic Sciences • Vol. 8 (57) No. 2 - 2015

The financial position and performance of the

economic entities from the Light Industry

Mirela Camelia BABA 1

Abstract: The Romanian light industry plays a significant role within the national economy,

especially if we refer to the number of jobs created in this field. In this regard, the

assessment of the financial standing and performance of the business entities from this field

is of particular importance not only for the national economy but also in terms of the

interests pursued by the management of the company, its shareholders, trading partners and

creditors. In this respect, this paper focuses first on the investigation and analysis of the

financial reports of 45 business entities which are representative for the Romanian light

industry (divided into three main constitutive parts: companies producing textiles, clothing

and footwear) and secondly, on highlighting the main similarities and differences from the

point of view of the main financial indicators.

Key-words: financial standing, financial performance, light industry, risks

1. Introduction

Light industry comprises business entities that may be divided into 3 main

production activities: textile production, clothing production and leather and

footwear production. In Romania, the light industry is an important field of the

national economy on one hand, from the point of view of the tradition it has in the

export activity (it is of utmost importance to state that in 2003 and 2004, Romania

was the leader among clothing exporters on the EU market, even if it stared to

decline in the following years) being as well the main employer in the industry, and

on the other hand, with regard to the qualitative high education offered in the field

(the specific academic specializations offered by Romanian universities).

In this respect, the industries of textiles and clothing, leather and footwear are

among the very few industries (together with furniture and unprocessed wood

industries) for which Romania has a sectorial specialization index higher than one,

this specialization index calculating a country's specialization in the j industry as

compared to another country or region (the EU, in this case) (Visileanu 2008, 139).

Thus, worldwide well-known companies have preferred to invest in Romania in the

1 Transilvania University of Braşov, mirela.baba@unitbv.ro