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Eurohold Bulgaria trims 9-mo cons net loss, insurance units boost revenue

Author Mario Tanev
Eurohold Bulgaria trims 9-mo cons net loss, insurance units boost revenue Eurohold/All rights reserved.

SOFIA (Bulgaria), December 3 (SeeNews) - Financial and insurance group Eurohold Bulgaria said that its consolidated net loss, excluding minority interest attributable to other shareholders, narrowed to 694,000 levs ($393,000/355,000 euro) in the first nine months of 2019 from 2.5 million levs the year before.

Group profit after taxes, including interest attributable to shareholders other than Eurohold, increased to 1.4 million levs in the January-September period of 2019 from 200,000 levs in the same period of last year, Eurohold Bulgaria said in an interim financial statement published last week.

Eurohold Bulgaria's consolidated revenue grew to 1.16 billion levs from 878.4 million levs.

The rise was mostly supported by the company's insurance subsidiaries, which saw their combined turnover jump 44% to 961 million levs. Eurohold registered a 3% decrease in its revenue on the automotive segment, to 176 million levs, and a 2% decline in leasing revenue, to 17.4 million levs.

The group's operating expenses increased to 1.16 billion levs in January-September from 878.2 million levs the year before.

Expenses on the insurance segment rose 47% to 909.2 million levs, while automotive segment expenses fell 4% to 157.8 million levs. Leasing expenses grew 34% to 3.8 million levs.

Eurohold's assets edged up to 1.44 billion levs at the end of September from 1.40 billion levs at the end of last year. 

The company's current ratio slightly worsened to 1.06 at the end of September from 1.10 at the end of 2018, despite a reported net cash inflow of 43.1 million levs in the review period.

In October, Bulgaria's competition regulator banned Eurohold's 335 million euro deal to acquire the assets of Czech energy group CEZ in Bulgaria. Both CEZ and Eurohold have appealed the regulator's decision before the Supreme Administrative Court.

As a result of the deal with CEZ, Fitch Ratings placed Eurohold Bulgaria's Long-Term Issuer Default Rating (IDR), and the Insurer Financial Strength (IFS) ratings of three of the group's subsidiaries on rating watch negative. After Eurohold announced that it will challenge the competition regulator's decision, Fitch Ratings said it is maintaining the ratings of Eurohold and its core insurance subsidiaries on rating watch negative.

"Eurohold's ratings reflect Fitch's assessment of its weak capitalisation and debt servicing capabilities as well as high financial leverage. These weaknesses are partly offset by the group's good albeit volatile financial performance," the ratings agency said at the time.

Eurohold shares last traded on the Bulgarian Stock Exchange at a price of 1.40 levs on November 29, representing a 12.5% decrease since the start of 2019. In comparison, the blue-chip SOFIX index, which counts Eurohold as a member, is down 7.8% so far this year.

(1 euro = 1.95583 levs)