As Poslovni Dnevnik writes, during the first nine months of 2022, Croatia’s well known Podravka Group successfully coped with the various market challenges generated by the coronavirus pandemic and the Russian aggression against Ukraine, the consequences of which are reflected in the strong and continuous increase in the prices of all raw materials, packaging and energy.
Over the first nine months of this year, the Podravka Group achieved impressive revenue growth of 329.1 million kuna, which is equal to a 9.7 percent increase when compared to the same period last year. The Nutrition segment grew by 11.1 percent, or 292 million kuna, while the Pharmaceuticals segment recorded an increase in revenue of five percent, or 37.1 million kuna. The investment cycle is in full swing, so capital investments at the Podravka Group level in the first nine months of this year amounted to 294.5 million kuna, which is almost three times more than in the same period last year when that figure amounted to 103.7 million kuna.
Operating profit before depreciation (EBITDA) during this same period was 5.7 percent higher, and net profit was 3.8 percent higher when compared to the first three quarters of 2021. However, comparing the third quarter of 2022 with the same period in 2021, a visible a drop in net profit in the Food segment can be seen, which is a direct consequence of business conditions that have further worsened due to rising prices of raw materials, packaging and energy. The current high costs of raw materials, packaging and energy in the Food segment amounted to 269 million kuna, meaning that they were 25.3 percent higher than they were during the same nine months of last year.
“The business conditions over the first nine months of 2022 have been far more challenging than we expected them to be back at the beginning of the year, which is why we’re strongly focused on optimising all types of costs and maintaining our sales volume. In this period we’ve just come through, through the active management of stocks, sales prices and increasing production efficiency, we partially amortised the rise in the prices of raw materials, packaging and energy, and thus managed to maintain growth.
I’m particularly pleased that, even in such challenging circumstances, we increased the salaries of our employees back at the end of March. However, it’s important to emphasise the fact that the results the Podravka Group achieved in the first nine months of 2022 don’t reflect what awaits us at the annual level. The most severe impact of cost growth awaits us in the fourth quarter, which will certainly affect the overall result for this year,” commented the President of the Management Board of Podravka, Martina Dalic, adding that despite this, the company is continuing to implement all its strategic plans, which include significant investments and improvement of conditions of work.
In accordance with the company’s development strategy, the implementation of the Podravka Group’s investment cycle is in full swing, as evidenced by the investments completed over the last three months. A new line at the Koktel Pastry Factory, worth 30 million kuna, was put into operation, and work was completed on the company’s solar power plant, which is currently the largest integrated (on the roofs of existing facilities/buildings) solar power plant in all of the Republic of Croatia.
In addition to all of the above, the Podravka Group’s production facilities were all fitted with air conditioning units and a complete energy and IT renovation of the business headquarters worth 104.5 million kuna was completed, which significantly improved the working conditions of a large number of employees. The digitisation of production processes at Tvornica Juha i Vegeta was also completed, the installation of a new line in Varazdin, worth 40 million kuna, is now in its final phase, and construction work on the expansion of Tvornica Juha i Vegeta began at the beginning of October. This investment, worth a massive 104.8 million kuna in total, is the first investment in the construction of new Prehrana production facilities in Koprivnica after fifteen years, which will also create new jobs.
During the month of September, the commemoration of the 75th anniversary of the Podravka Group began, and the management of the company made a decision to pay the employees a special award in the amount of 750 kuna to mark the occasion, instead of being boastful with large ceremonies.
For more, make sure to keep on top of our dedicated business section.
