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Croatia's Fortenova swings to profit in 2021

Author Annie Tsoneva
Croatia's Fortenova swings to profit in 2021 Photo: All Rights Reserved

ZAGREB (Croatia), June 22 (SeeNews) - Croatia's Fortenova Group, successor to the collapsed food-to-retail concern Agrokor, said it posted a net profit of 523 million kuna ($73 million/70 million euro) last year, an improvement by 1.8 billion kuna compared to the loss recorded in 2020.

Fortenova Group’s 2021 total consolidated revenue from continuing operations amounted to 31.4 billion kuna, with consolidated adjusted EBITDA of 1.955 billion kuna, after the gain from the sale of its frozen food unit, the company said in a statement on Tuesday.

Fortenova announced in September it has successfully completed the sale of its frozen food business to UK-headquartered Nomad Foods for 615 million euro ($712 million).

“These results equate to a growth of consolidated revenue from continuing operations of 65% and adjusted consolidated EBITDA growth of 52% compared to 2020. The main driver of the consolidated results performance is due to [Slovenian top retailer] Mercator Poslovni Sistemi, being consolidated into Fortenova Group’s results as of May 1, 2021,” Fortenova explained.

Compared to the 2020 year-end results, the 18 companies from the group’s core business, excluding the frozen food unit that has been sold and including full year of Mercator Group companies, recorded on a like-for-like basis a revenue growth of 5%, a 20% growth of EBITDA, and a 64% increase in EBIT.

The Fortenova Group ended last year with 1.872 billion kuna in cash on its accounts.

In the first quarter of 2022 the 18 companies from the Fortenova Group’s core business reached on a like-for-like basis 6.0% higher net sales revenue, 2.0% higher EBITDA and 6% higher EBIT compared to the first quarter of last year, according to the statement.

Fortenova Group, which is now in the position to pursue a regional investment cycle worth over 130 million euro in 2022, as all of its investments are focused on more sustainable and more efficient operations, Fabris Perusko, Fortenova Group’s CEO said in the statement.

“We continue to deliver on our planned financial strengthening and simplification of the Group. Through the transactions dealing with Mercator, Frozen Group as well a number of non-core and real estate sales Fortenova reduced its debt in 2021 by 4.4 billion kuna which led to an underlying leverage ratio of 4.3x at year end,” James Pearson, Fortenova Group’s chief financial officer, said adding that this is a significant decrease from the 6.8x leverage ratio it had at the beginning of the year.

In April, Fortenova said its biggest shareholder, Russia's top lender Sberbank, signed an agreement to sell its more than 40% stake in the Group to Hungarian asset manager Indotek.

Earlier this month, Fortenova said is it is 42.51% owned by SBK ART LLC (whose ultimate majority owner is Sberbank of Russia), while 7.39% is owned by VTB BANK (EUROPE) SE. During the restructuring, a sanctions safeguard mechanism was implemented that prevents shareholders subject to sanctions from exceeding 50% of ownership, independently or jointly.

Fortenova is Croatia's largest privately-owned company and one of the biggest companies in Southeast Europe. It has over 50,000 employees and operates in three core activities: agriculture, retail and food, as well as non-core operations. It has manufacturing plants in several countries. Along with Mercator, it also owns the biggest food retail chain in Croatia, Konzum. Konzum and Mercator together have a significant market share in Bosnia.

(1 euro = 7.519 Croatian kuna)

Poslovni Sistem Mercator d.d. is among the biggest companies in SEE, for more reference take a look at Top 100 companies
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