Reka Rubber improves profitability as volumes increase

Aura, Finland – Reka Industrial Group, which currently only consists of Reka Rubber Ltd., has reported higher year-on-year earnings (EBITDA), helped largely by higher volumes.

The rubber segment increased volumes at the beginning of the year, which led to a 7% year-on-year higher sales to €8 million, Reka reported 24 April.

Earnings for the period grew strongly to €900,000, up from €200,000 reported in the first quarter of 2024.

Commenting on the results, president and CEO Sari Tulander said the general economic situation and market uncertainty were reflected in the order volumes and short order times of Reka Rubber's customers during the first quarter.

At the beginning of the year, she said, some customers reported an increase in volumes, but the US announcement of tariffs in April may change customers' volume needs.

“Currently, the outlook for volume growth is uncertain, as the tariffs and their impact on our customers are not yet clear,” Tulander said.

Going forward, Tulander said Reka Rubber will aim to reflect cost increases in sales prices “as quickly as possible.”

In addition, the company intends to focus on improving productivity and cost efficiency and strengthening the conditions for future growth by developing its product offering and production technology.

On its previously announced M&A strategy, Reka Industrial said it evaluated several companies for its next stage of growth.

However, it said, there was a limited number of potential companies that met its criteria and eventually no transaction was made.

Elsewhere, the group invested €1.3 million in an energy project to improve the energy efficiency of Reka Rubber’s Aura factory.

As part of the investment, a power-to-heat thermal storage unit is being installed at the factory, to eliminate oil from production processes.

To be commissioned early next year, the unit will also serve as the factory's primary source of heating energy.