ZAGREB, May 14, 2018 – The Food and Agriculture divisions of the Agrokor conglomerate continued to operate at a profit in the first quarter of 2018, while the Retail and Wholesale division posted an operating loss, according to the latest monthly report by the emergency administration released on Monday.
The report says that the bulk of work on a settlement with the creditors was expected to be finalised before the end of this month.
The report, covering the period from April 11 to May 10, shows that the Retail and Wholesale division generated a sales revenue of 2.87 billion kuna, with a negative EBITDA (earnings before interest, taxes, depreciation and amortisation) of 4.2 million kuna
“Although in the cumulative period slightly lower-than-planned revenues were generated, activities related to the Easter holidays resulted in revenues in March exceeding budget in Konzum retail stores in Croatia and Bosnia and Herzegovina,” the report said.
Konzum, the largest company in the Retail and Wholesale division, generated a sales revenue of 1.96 billion kuna and an EBITDA of 26 million kuna.
Preliminary data shows that the Food division posted a sales revenue of 1.5 billion kuna and an EBITDA of 136 million kuna. “Despite a slight drop in sales revenues the generated operating profit (EBITDA) exceeded budget,” the report says.
The Agriculture division generated a sales revenue of 466 million kuna and an EBITDA of 35 million kuna. The highest revenue, of 281 million kuna, was generated by Belje, with an EBITDA of 25.5 million kuna.
“Agriculture sector revenues for March were 2.3% lower than expected, with the significant drop in finisher and pork prices having been partially compensated by other activities such as sales of animal feed, wine, oil and cereal crop as well as other goods from production. In the forthcoming period, we expect the pork market to recover, with a resulting improvement in EBITDA,” the report says.
It says that since the signing of the settlement term sheet on 10 April 2018, the emergency administration and its consultants have continued to work with the members of the Temporary Creditors’ Council and other creditors on elaborating the final settlement plan.
“In accordance with the EPM (Entity Priority Model), the available value of the Group will be distributed in a fair and equitable way, individually by each company subject to the Extraordinary Administration, to all creditors who have registered their claims, while in parallel a comprehensive, complex legal text is being drawn up – the settlement agreement – which will define all details of the arrangement to be achieved by the creditors by way of the settlement. The intensity of work on the aforesaid documents is expected to keep increasing in order for the majority of matters to be completed by the end of May,” the report says.
The emergency administration published the audited consolidated results of the Agrokor Group and the parent company Agrokor d.d. for the year 2017, which were described as very good considering that the company had almost gone into bankruptcy. The individual reports of the operating companies will be published once audited, during the course of May 2018.
The costs of consultants in March 2018 increased by 1.6 million kuna to 27.26 million kuna, of which restructuring costs accounted for 14.5 million kuna. Since the appointment of the emergency administration on 10 April last year, the total costs of Agrokor d.d., including the emergency administrator’s fee, wages for the employees and consultant fees, reached 580.5 million kuna, the bulk of which (321.38 million kuna) accounted for the costs of consultants.
