Costil Strasbourg in receivership24 October 2005
The commercial court of Strasbourg has authorised Costil to continue trading for four months until November after the company declared insolvency. Costil Strasbourg began trading again three years ago and the company achieved stable profits in the first two years. However, profits have declined by 15% since October 2004. This can be attributed in part to the strengthening of the euro against the dollar as Costil previously earned 52% of their revenue from exports. In addition, Brussels has ruled that companies in receivership must now pay business tax. This ruling signified a 4% reduction in Costil's annual figures which has added extra pressure in an already difficult climate. Company boss Jean-Claude Ricomard informed employees, clients and suppliers of the situation at a special meeting. The leather sector in France comprises 570 companies and employs 36,000 people, achieving an annual turnover of €365 million. World competition is strong and it should be noted that in recent years several companies have relocated to developing countries. There are now just 24 tanneries in France, employing 1,200 people. Six of these tanneries specialise in calfskins and these alone produce 70,000 skins per month. France is a world leader in veal production and 55% of the resulting skins are processed within France. French calfskins are used in the high-end market, with 50% used in footwear, 40% in leathergoods and 10% in garments.