Agrokor: Net Losses Reduced Substantially in 2018

Total Croatia News

ZAGREB, May 14, 2019 – The Agrokor Group in 2018 earned consolidated audited revenues in the amount of 38.8 billion kuna, 1.8% down from the year before, while its operating profit grew strongly to 2.39 billion kuna and net losses dropped considerably in comparison to 2017, to 1.4 billion kuna, shows a report the group released on its website on Tuesday.

The consolidation covers 108 companies in which Agrokor has a controlling interest, of which 53 are in Croatia.

The group’s consolidated revenues of 38.8 billion kuna are 712 million kuna or 1.8% down from 2017. Operating expenses dropped by 10.9% or 4.7 billion to 39.2 billion kuna.

The group’s loss after taxation was 1.4 billion kuna, which is much less compared to the 2017 loss of close to 6.1 billion kuna.

Agrokor’s extraordinary administration points to a strong increase in operating profits of 22% to 2.4 billion kuna, which is 427 million kuna more than in 2017. The growth in operating profits is owing to restructuring that has been launched in all business segments of the group, both in terms of revenue and in terms of expenditure.

The biggest generator of growth of operating profits were the retail and wholesale segments, namely the Konzum and Mercator retail chains.

The operating profit in the Retail and Wholesale segment totalled 1.2 billion kuna, an increase of 681 million or 133%.

The extraordinary administration said that the drop in revenue was mostly due to the Agriculture business segment recording a decline in the volume of trade in agricultural produce and lower market prices of fattened animals and semi-hard cheese as well as due to a drop in sales revenues of the Retail and Wholesale segment.

The Retail and Wholesale segment in 2018 earned sales revenues in the amount of 29 billion kuna, 3.9% less than in 2017. The drop was due to competitors’ opening new production areas in Serbia and Montenegro, the Extraordinary Administration said.

It noted that the drop in revenues due to the closure of nonprofitable Konzum stores was compensated for with an increase in revenues of 5.7%.

The Food business segment in 2018 posted operating revenues in the amount of 1.2 billion kuna, an increase of 3%. The business revenues of that segment were down 106 million kuna or 1.2%, totalling 9.1 billion kuna.

The Agriculture segment earned revenues in the amount of 2.3 billion kuna, a drop of 18.6%, while operating profits totalled 113 million kuna, down 60%.

The extraordinary administration said that 2018 saw Agrokor’s creditors close a debt settlement plan that was implemented in the first quarter of 2019.

The group’s financing was stabilised through the extension of the Super-Priority Term Facilities Agreement (SPFA) loan and preparations for its refinancing.

Priorities for this year are the already launched process of refinancing the SPFA loan, operational restructuring and the elaboration of a new strategy for the Fortenova Group (the new name of the Agrokor Group, under which it started operating on April 1), the Extraordinary Administration said.

More news about Agrokor can be found in the Business section.


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