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Food export and import Main exports are sugar, cigarettes, wheat and tuna, imports cattle cake, live cattle and coffee

Željko Jurkin, Eurovoće Group director Production below 12,000 tonnes of fruit and vegetables is insufficient for market survival

Vestibul Palace – the best small family hotel in Croatia Many famous celebrities have visited this hotel with only seven rooms

FOOD MARKET PAGE 3

INTERVIEW PAGE 4

TOURISM PAGE 8 2010

Croatian Business & Finance Weekly Established in 1953 Monday / 7th November / 2011 Year V / No 0173 www.privredni.hr

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pvinternational pv international C R O A T I A N

C H A M B E R

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E C O N O M Y

AGRICULTURE AND FOOD PRODUCTION

A half decade of news Once again it falls to me to write an introduction to year 5 of PVInternational. The past year has been tumultuous; as Shakespeare might well have written “many amongst us were beset by fardels”. The remainder of this year is significant for Croatia; in the next few months we have a general election taking place as well as a referendum on joining the European Union. We view the latter as an important milestone which is exciting as, for Privredni vjesnik and PVInternational, our voice will gain greater stature. We look forward with anticipation to bringing you all the information and its implications in our weekly dispatches. Just as we aim to be the voice of Croatian entrepreneurs internally, so we aim to be their ‘window to the external world’ a role we feel we are well-positioned to accomplish. Finally, I would confirm our sincere intention to bring you weekly all up-to-date information concerning Croatia. Thank you for your support in the past and in the future, Darko Buković Editor-in-Chief

Great potential one must know how to use The food and beverage industry contributed 21% to gross added value of the processing industry Igor Vukić ifferent types of climate, relief and soil in Croatia enable the production of various agricultural products, from arable and industrial crops to vineyards as well as continental and Mediterranean fruit and vegetables. Croatia has a total of 1.3 million hectares of cultivated agricultural land, of which 66% relates to ploughed land and gardens, 27% to permanent grassland, 7% to orchards, vineyards and olive grooves, 0.4% to vegetable gardens and 0.1% to nurseries. Due to its preserved nature and environment, Croatia has an advantage over other developed countries and can produce a variety of high-quality food safe for consumer health. Around 14,000 hectares or 1.2% of agricultural land is under ecological production.

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There are around 1,200 companies with approximately 15,000 employees working in agriculture. Benefits from joining EU According to data provided by the Sector for Agriculture, Food Industry and Forestry of the Croatian Chamber of Economy, headed by its Director, Božica Marković, the most profitable activities in the agricultural sector are the production of cigarettes and tobacco processing, fish processing, beer production, milk processing, tea and coffee processing and the production of soft drinks. These are also activities that have attracted the bulk of foreign investment and whose companies operate successfully. Croatian agriculture should have great benefits from joining the EU and the Common Agricultural Policy. Furthermore, it will

be able to use extensive resources from European structural funds. The food and beverage industry contributes 21% to gross added value of the Croatian processing industry, and the production of tobacco products with 2.5%. There are over 1,200 companies registered in the industry, with roughly 47,000 workers and approximately 20% of the total number of employees in the processing industry. The production of food, drinks and tobacco are activities with the highest employment rate and total income compared with other branches of the processing industry. A variety of products and brands have earned a good reputation on local and foreign markets, and the Croatian Chamber of Economy has issued the highest number of labels for quality and originality to food products.


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Privredni vjesnik Year V No 0173

Luka Marelić, director, Agricultural Co-operative Pošip Čara

FOOD SECTOR LEADERS

Optimistic about the Law on Co-operatives The share of each member in the co-operative must be clearly defined

ven though pošip is a type of grape that matures earlier, the harvest this year was finished in mid-September. In terms of quality, this might be the best harvest of the past decade. However, in terms of quantity it is 40% below the level of 2010. This means that the wine produced this year will be long remembered for its quality. I must point out we are no different from other wine producers, since the volume of our supreme wine does not fall below 70% of the total quantity, and this year it will exceed 95% due to an extremely good harvest. Regarding the market, I can say that nothing has changed as the market is saturated, partly due to higher production levels and partly due to the fall in purchasing power and increased imports, all of which have created a surplus. Moreover, illiquidity creates a burden for all those in the wine market, creating to an extent a vicious circle

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IMPRESSUM: Privredni vjesnik Kačićeva 9 10000 Zagreb +385 1 5600020 uprava@privredni.hr www.privredni-vjesnik.hr/ subscription

where everyone owes everyone. However, we managed to create a name and a trade mark in demand. For the past ten years we have been successfully exporting to the American market pošip Marko Polo and now we export to the same market our pošip Čara, our most popular product. This is very important for our co-operative which is one of the most successful of wine co-operatives. We owe this reputation to constant investment in new technology and modernisation of the plant, and during the past several years we have invested almost €1.35 million. Furthermore, the Pošip Čara Cooperative has 140 members. As a result of the recently adopted Law on Co-operatives, we expect all relationships that had been a burden to the business of co-operatives, to be defined. Primarily, the share of each member of the co-operative must be clearly indicated. What is also important is that such mechanisms have been created that a co-operative cannot be abandoned or that its assets should not be divided and then misplaced. The intention of the law is to clearly define the share and contributions of co-operative members and that common assets cannot be sold or distributed. This also means that no-one would be able to purchase or appropriate common assets. It is true, however, that the Law does not solve the problem of trustworthiness of certain members. In my opinion it should, since a member could place poorer quality grapes into the cooperative or sell them when the harvest is better. Luckily, our co-operative does not have such problems..

FOR PUBLISHER Nikola Baučić +385 1 4846661 uprava@privredni.hr

IMC MANAGER Dea Olup +385 1 5600028 olup@privredni.hr

EDITOR IN CHIEF Darko Buković +385 1 5600003 bukovic@privredni.hr

TRANSLATION Lučana Banek lucanab@gmail.com Mirjana Cibulka mirjana.cibulka@gmail.com

EXECUTIVE EDITORS Andrea Marić maric@privredni.hr Vesna Antonić antonic@privredni.hr

INTERNATIONAL OPERATIONS Ray Fletcher fletcher@privredni.hr

Quality and excellence through innovation he 400 largest food processing companies generate nearly 88% of all revenue from this sector. These companies booked a total of €5.8 billion in revenue, whilst other companies (3,757) generated €0.77 billion. Data show a similar situation in terms of profit. These 400 made €0.24 billion in profit against €31 million from other companies. The largest companies employ a total of 52,846 staff, whilst the remainder have 17,105 employees. A similar situation exists amongst the 50 best performing companies. 9 companies employ over 1,000 employees, with 9 companies (Vindija, Podravka, Dukat, PIK Vrbovec, Belje, Koka, Jamnica, Ledo and Zvijezda having annual revenue of over €0.14 billion. Zvijezda generated €131 million in revenue during 2010 followed by the Meat Processing Industry Brothers Pivac with €130 million, the Croatian CocaCola subsidiary with €129.6 million and Kraš with €122. The Varaždin-based company, Vindija, is at the top of the list of individual organisations, with annual revenue of €0.36 billion and €3.38 million in profits. Company success has been the result of 50 years of investment into innovation, technology and knowledge. Vindija has received many valuable international awards as a result of its healthy and safe food product range, following global trends and exporting to the European Union. The Koprivnica-based company, Podravka, has annual revenue of €0.26 billion and with its 3,639 employees is currently one of the few successful food processing

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companies which is not in private ownership. It has succeeded in operating positively and in increasing profitability, irrespective of current difficulties due to ownership and managerial issues. Anticipating Croatian EU accession The Zagreb-based company, Dukat, with its €0.23 billion in profits, has continued its development as an element of the French food processing conglomerate Lactalis. The company is the regional leader within the group, due to its top quality and new product development. It is followed by two companies from the Agrokor Group: PIK Vrbovec (€0.20 billion revenue) and Belje (€0.19 billion), Koka (€0.16 billion), another company in the Vindija Group and three companies in the Agrokor Group - Jamnica (€0.15billion), Ledo (€0.15 billion) and Zvijezda. Agrokor companies follow the conglomerate tradition: on-going investment appropriate funding, the use of advanced technology and top quality control systems to promote food safety. Similar business policies are also followed by other companies under the ownership of the 50 best performing companies group, along with continuous investment in marketing, market research and analysing market expansion possibilities. Some companies rely on foreign owner assistance, others on their own potential, anticipating Croatian EU accession, which will create new opportunities for exports. Nevertheless, this will result in severe competition on the local market. (I.V.)


www.privredni.hr Business & Finance Weekly

3

( €0.59 billion ( €1 billion food and beverages exported

food and beverages imported

FOOD EXPORT AND IMPORT

B&H is the main export market with Germany the main import market Croatia mainly exports sugar, cigarettes, wheat and tuna, importing cattle cake, live cattle, non-roasted coffee, pigs and bananas Drago Živković uring the first nine months of this year, Croatian food and beverage companies exported 6.6% more products than in 2010. Food and beverage exports totalled €0.59 billion according to data provided by the Central Bureau for Statistics. Imports are still far higher (€1 billion), but growth has slowed this year. In the agricultural sector, exports of vegetable and cattle products totalled €115.3 million (+8.3%), and exports from fisheries totalled €62 million (+58%). During the first nine months of this year, the food industry exported 2% more food products (€0.42 billion). Beverage exports were worth €77.7 million and tobacco products €38.92 million (-16.4%). Last year, Croatia exported food and drinks worth €1.36 billion, approximately €27 million more compared with 2010. Exports reached €0.83 billion (+€35 million), showing that 2010 registered a deficit of €0.52 billion and around €6.76 million less than 2009. Croatia mainly exports sugar, cigarettes, wheat and tuna. It imports cattle cake, live cattle, non-roasted coffee, pigs and bananas.

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Importers also exporters The list of the largest food exporters is dominated by supermarket chains. Konzum is the largest, followed by Lidl, Kaufland and Plodine. Food

processors are also big importers, which obviously lack raw materials from the local market. PIK Vrbovec, Braća Pivac, Gavrilović, Podravka, Danica and Koka fall into this category. Trade companies should also be included, particularly those importing food only for the purpose of selling, such as Stanić and Betoven. The biggest food processors are not only big importers. They are also the largest food exporters with Koka, Dukat, Vindija, PIK Vrbovec, Agrofructus, Podravka, Gavrilović, and Danica in this section. The most important export market for the food industry is B&H (one third of all exports), followed by Italy and Slovenia (10%) as well as Serbia (around 7%). Croatia im-

ports from Germany (14%), Italy (11%), the Netherlands (8%) and Brazil (mainly meat). As in many other industries, the majority of goods are traded with EU countries ($2 billion). Deficit remains All the advantages and problems of Croatia’s position as a small, open economy are probably best reflected in agricultural and food production. During the past ten years, Croatia has tripled its import/export figures. However, the deficit, expressed as a percentage, remains stubbornly high. This is a consequence of the insufficient restructuring of local production which cannot seem to cope with foreign competition. This is confirmed by data according

to which total agricultural land has halved to roughly 1.2 million hectares, half of which relates to grain growing. A large proportion of the problem lies in split holdings. Of 190,000 registered producers, 63% cultivate less then 3 hectares of land, according to data provided by the Croatian Chamber of Agriculture. During the past decade, middle-sized producers have grown (from 20 to 300 hectares), and they now own around 32% of agricultural land and their significance continues to grow. Large systems should also be added, such as Agrokor, Podravka, Vindija and Žito, which not only directly cultivate tens of thousands hectares, but incorporate thousands of subcontractors.


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INTERVIEW

Privredni vjesnik Year V No 0173

( €35 million

value of Croatian processed fruit and vegetable market

ŽELJKO JURKIN, EUROVOĆE GROUP DIRECTOR

Top quality from local producers Production below 12,000 tonnes of fruit and vegetables is insufficient for market survival Boris Odorčić he total value of the Croatian processed fruit and vegetable market is estimated at about €35 million. Imports value by the end of September stood at about €8 million and it is expected to increase by between €2 and €2.7 million by the end of the year. Consequently, local production stands at about €25.7 million. Eurovoće Group exports about 10% of its production and this year exports are anticipated to be €1.67 million. Željko Jurkin, Eurovoće Group Director, pointed out that Croatian processed fruit and vegetable production has significantly impacted on the trends dominant for the last fifteen years throughout the region.

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What is the reason for significant changes in the Croatian processed fruit and vegetable market? There was a significant product range expansion from Hungary and Bosnia and Herzegovina over the last decade. Prior to Hungarian EU accession, the Hungarian processing industry had significant export incentives which were used by local producers for market expansion, primarily by dumping rather than focusing on modernisation and strengthening competitiveness. Many Hungarian companies went bankrupt following Hungarian EU accession and as a consequence of the abolition of the export stimulus package. They have been taken over by German and Austrian organisations, producing primarily for their former markets and sub-

sequently their position on the Croatian market has significantly weakened. On the other hand, large processing companies in Bosnia and Herzegovina have significantly reduced production, most probably due to excess investment in equipment and production plant, enabling local producers to increase production and local market sales. Significantly, Croatian consumers are opting for quality food of controlled origin, regardless of the crisis and Croatian producers have largely exceeded their competitors. Why have you merged Nova Đakovčanka and Marinada, two factories in Slavonia? We analysed the market situation and concluded that we would remain a small company, unable to meet market needs for quantity following Croatian EU accession. Subsequently, we decided to grow by merging two factories in Slavonia and to specialise our production. We have come to the conclusion that an annual production level of below 12,000 to 15,000 tonnes of fruit and vegetables is insufficient for market survival due to the low rate of capital turnover and high fixed costs. The acquisitions and the formation of the

Eurovoće Group will certainly improve results, as we have processed some 15,000 tonnes of fruit and vegetables this year. Which processed fruits and vegetables have the greatest potential? Sour cherries and blueberries most certainly have the greatest potential. In addition, we believe we can sell a considerable quantity of peppers, pears, cherries and apricots to the European market. Nevertheless, trends in production and consumption of pasteurised product range are weakening

throughout the world and global consumption of processed fruit and vegetables currently stands at a low 5%. Currently, there is a growing trend towards fresh and frozen fruit and vegetables consumption, which requires larger investment in infrastructure, cold storage plants, irrigation, high technology and similar. What are your plans for the near future? An exclusive focus on the market is imperative in entrepreneurship in general and, consequently, for Eurovoće. The continuous following of market trends in our branch and on a larger scale, adjusting to customer demands and investment in development are the prerequisites for market survival. Following consumption trends, which usually impact Croatia quite rapidly due to large market chains, making us constantly reflect on our production and expand our product range. Markets are currently specialised and demanding. Nevertheless, one can strive towards development and progress by following trends.


www.privredni.hr Business & Finance Weekly

5

( 70 years

( €45 million

continuous edible oil production

invested in reconstruction and modernisation in 2003

ČEPIN EDIBLE OIL FACTORY

A good opportunity The final phase of privatisation for the largest Croatian edible oil factory and the most prominent Croatian factory for oil refining Svetozar Sarkanjac he Čepin edible oil factory is marking its 70th anniversary of continuous edible oil production in 2012. The edible oil refinery was founded in 1942 by Špajzer, a large estate owner from Čepin. The refinery was initially called the Oil and Alcohol Factory, as it also produced alcohol and even veal livestock feed, since there was considerable demand for it. The factory owner at the time skilfully opted for a comprehensive production cycle: producing edible oil from sunflower seeds, whilst using lower quality sunflower seeds for alcohol production through fermentation. In addition, he used the by-product of sunflower seed processing (sunflower flat bread) as quality livestock feed for beef and veal fattening. Nevertheless, Špajzer’s managerial skills were severely challenged by the war. The edible oil refinery was part of the state-owned PIK Belje company for a brief period following the

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Second World War. Subsequently, the authorities moved the refinery, first to Gospić and then to Glina for fear of possible Soviet aggression in 1949. The factory returned to Čepin in the mid1950’s to become part of IPK Osijek, a company which nearly matched Špajzer’s skill in managing comprehensive production cycles, in 1961 and remained so until recently. Subsequently there was another war and some unusual alterations in the ownership structure. The oil refinery was reconstructed several times between the two wars and in 2003 it was fully reconstructed and modernised with an investment of €45 million. Privatisation finally The Čepin edible oil factory has been the largest Croatian edible oil factory and the most prominent Croatian factory for raw edible oil refining over a long period of time, nevertheless, it has not been privatised thus far. It saw a plethora of financial and legal consequences of its operation in

IPK Osijek as. Finally, the edible oil factory became a state-owned

A future buyer will purchase the factory in “turn-key” condition, including the Čepin edible oil brand company in mid-2011, following many delays and employee protests. By mid-August the Agency for State-Owned Asset Management (AUDIO) issued a Public invitation for bids for IPK Čepin share purchase of 81.5% of stateowned equity capital. The deadline for the submission of the Letter of Intent expired at the beginning of September and we are currently expecting the Agency for State-Owned Asset Management final decision on the initial price and on the implementation of the process of legally binding offers. Four companies are allegedly interested in purchasing the oil refinery.

“We are the largest Croatian edible oil refinery with annual production capacity of 135,000 tonnes of sunflower and rape seed processing. Total production capacity of raw edible oil refinery stands between 55,000 and 58,000 tonnes, which is sufficient for one year of consumption in Croatia. The ultimate consumer is primarily interested in refined oil production and annual production capacity stands at 30,000 tonnes of refined oil”, stated Stjepan Komar, Čepin Director. Turn-key condition The buyer will purchase the factory in turn-key condition including the reputable Čepin edible oil brand. “We expect to see our primary identifiable product, refined sunflower oil following the finalisation of the privatisation process and the solution to the necessary turnover in capital funding. We are planning to have a 25% to 30% share of the Croatian refined oil market”, stated Komar.


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Privredni vjesnik Year V No 0173

CROATIAN FOREIGN CURRENCY MARKET Currency

AUD CAD JPY CHF GBP USD EUR Source: HNB

EUR

Kuna exchange mid-rate

7.50

5,636721 5,357121 6,945740 6,139538 8,690027 5,418702 7,495148

5.44

1.11.

2.11.

3.11.

CHF

6.17

7.49

5.41

6.15

7.48

5.39

6.13

7.47

5.36

6.11

7.46

5.33

6.09

5.30

7.45 31.10.

WEEK NOVEMBER 5, 2011

::: news

USD

4.11

31.10.

1.11.

2.11.

3.11.

4.11

6.07 31.10.

1.11.

2.11.

3.11.

4.11

MOJ-BANKAR.HR

Petrokemija reverse trend The Kutina-based company Petrokemija made €15.47 million profit during the first nine months, compared with a €17.12 million loss over the same period in 2010. The planned sales target of mineral fertilisers was 101.9% implemented, whilst the production plan target was exceeded by 12.4%. Business revenue stood at €0.30 billion, and expenditure was €0.28 billion. EBITDA stood at €28.57 million. Wustenrot new insurer

The Croatian Financial Services Supervisory Agency has granted an operating permit to Wustenrot life insurance, a new insurer to the Croatian market. In addition to life insurance approval, Wustenrot has been granted a permit for accident insurance cover and health insurance. A new market player, currently ranked 17th in life insurance market, is not planning any investment into the most lucrative market segment, third party liability insurance for motor vehicles. Croatian Postal Bank (HPB) profits Croatian Postal Bank made €9.54 million profit during the first nine months. The bank recorded an increase in most business areas. Consequently, total deposits saw a 9% increase to €1.62 billion, personal loans were 6.1% up, corporate loans rose by 5.5% and housing loans soared 31.8% over the same period last year.

12% OF LOANS UNRECOVERABLE Lending quality to the economy and the strengthening of the Swiss Franc have had a significant impact on the increase non-performing loans he Croatian financer industry had an 11% to 12% level of non-recoverable loans in 2011, which is on par with other comparable economies in the region. Currently, such loan rates in most countries throughout the region have doubled compared with the pre-crisis period in 2007, according to an analysis carried out by Mojbankar.hr.

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2012 will not see a decrease in unrecoverable loans or a lowering of interest rates The crisis, which began three to four years ago, has resulted in a decrease in trade and industrial production and, consequently, lower employment throughout almost all countries in the region.

The increase in non-recoverable loans from banks which had aggressively increased their loan portfolio during the pre-crisis period was a consequence of such macroeconomic trends. According to the analysis, the Eastern European region has been severely affected by this trend, whilst the USA and Eurozone countries, with a higher level of monetary policy autonomy, have witnessed relatively lower non-recoverable loan rates. Higher capitalisation level than in the West Bank capitalisation in the region significantly exceeds that of Western countries, irrespective of high non-performing loan share, mainly generated by real estate transactions. The regional average exceeds 13%, whilst West European countries are currently standing at about 9%.

In addition, regional banks have not been exposed to, or have been minimally exposed to toxic financial instruments created by the USA. The lending quality in the economy and the strengthening of the Swiss Franc have had a significant impact on the increase in the level of such loans in Croatia in 2011, which severely affected personal lending. According to banks, a high share of non-performing loans is one of the major obstacles to any lowering of interest rates in Croatia. 2012 will not see any decrease in non-performing loans or a reduction in interest rates irrespective of the announcement of the necessary cuts and analysts’ estimates on minimum GDP growth over the forthcoming period, subsequently contributing to insecurity in the labour market, as stated in conclusion. (V.A.)


www.privredni.hr Business & Finance Weekly

WE PRESENT 7

PANETA, BJELOVAR

DIM MES, DRNIŠ

Doors to demanding markets We produce new types and shapes of panels every year, irrespective of limited production space

Ample room for improvement The company presently produces around 300 tonnes of dried meat products mostly Drniš prosciutto n 2001 Iveta, a locally wellknown Bjelovar company dealing with PVC processing, identified a market demand for quality panels for entrance doors. Subsequently, it created a subsidiary called Paneta, which has to date developed a wide range of entrance door panels, basing its production on top quality materials and modern design, in compliance with the highest British standards. Britain initiated PVC panel production in 1960’s. The

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Paneta is aiming to maintain top quality level and is convinced there will be an increasing number of clients company began with the production of aluminium decorative panels two years ago, using high quality aluminium steel sheet and processing it, in accordance with Qualicoat standards using electrostatic powder coating. Its focus on top quality has resulted in satisfactory sales results. Paneta has been constantly increasing its market share in Slovenian and French h markets over four years, following success on the Croatian market. Intense negotiations are in progresss with potential clientss

in Italy and Switzerland and the sale of products in these markets is anticipated in the near future. In 2004 it created a subsidiary in Banja Luka which has been selling panels in Bosnia and Herzegovina. Market recognition “We constantly focus on top quality materials, producing new types and shapes of panels every year, irrespective of our limited space, and presenting them in our catalogues. We now have considerable market identification for the designs and the information presented in our catalogues”, noted Ivan Peček, Paneta Director. The company assists its clients to choose the entrance door design, opting for various types of glass decoration. Panels are resistant and stable and in accordance with sound and thermal insulation standards, requiring minimum maintenance. Paneta is aiming to maintain top quality level and is convinced there will be an increasing number of clients in the Croatian market opting for quality panel doors. Its export orientation will be towards the Western European Union and Scandinavian countries. It is anticipatcount ing innovation in annual panel production, in accordance with the a current technological curr standards. (I.V.) stan

he Drniš-based company Dim mes continues the tradition of the Blažević family who has been in the business of drying prosciutto and other semi-durable and durable dried meat products for many generations. Even though it has been operating under this name since 2001, the company made a big step forward in 2009 when the old plant was demolished and a new one built with state-of-the art equipment and computerised monitoring of the production process. The modernised production premises now fully comply with all HACCAP standards. Around €3.38 million was invested in the new plant, partly from the Development and Employment Fund and partly from family capital. The company presently produces around 300 tonnes of dried meat products, mostly Drniš prosciutto and other local Drniš products, such as Dalmatian grilling sausage (pečenica) and pancetta. Dim mes employs 26 workers and its production capacity is approximately 6,000 tonnes of prosciutto and around 400 tonnes of other durable products (grilling sausages, pancetta, buđola and other types of sausages). Its production capacity is now slightly below 40%. The company’s owner, Ante Blažević, says there is ample room for improvement and increased capacity, but the main

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problem is the funding system, that is, unresolved financing and lack of resources. High-quality delicacies The company achieves an annual income of around €2.7 million, but it could operate much better with greater financial support. The consultants that have drawn up a strategic development plan are convinced that a better financing system, organisation, improved sales system, product packing and labelling would double income in a very short period of time, points out Blažević. Dim mes imports raw material (whose procurement is the key problem of the Dalmatian producers of prosciutto and other dry meat products), from the Netherlands. Our market is disorganised, and Croatia meets only around one fifth of its needs. The remainder relates to import or semi-import, stimulated by countries that export outside the EU. This means Italian and Spanish producers have an advantage since they are motivated to export outside the European Union, and they often sell products below the standards of their countries. On our market the price of prosciutto ranges between €6.75 and €20 per kilogram, explains Blažević, who will not give up on the production of high-quality delicacies despite the battles. (J.V.)


8 ::: news Ina profit rises

Privredni vjesnik Year V No 0173

Vestibul Palace – the best small family hotel in Croatia

Good marketing is priceless Famous celebrities who have visited this hotel, with only seven rooms, have been Formula 1 drivers and ‘Star Trek’ actors

Ina Oil Company increased its profit during the first nine months of the year. Nett profits came in at €0.28 billion, €0.2 billion up year-on-year. The production of oil and gas increased, and nett debt was cut by 18%. This year Ina’s sales totalled €3.07 billion, 20% more over 2010. Tolls increase income Toll income from Croatian motorway concessionaires amounted to €0.22 billion (excluding VAT) during the first nine months of this year. This is 4.37% more year-on-year according to data provided by the Croatian Association of Toll Motorways Concessionaires. The highest income (HRK1 billion) was achieved by Hrvatske autoceste, 2.4% up in relation to the same period of 2010. It is followed by Autocesta Rijeka-Zagreb, Autocesta Zagreb-Maribor and Bina Istra. Varteks deficit reduced

Varteks increased its profitability during the first nine months. Total income for the company from Varaždin stood at €31.38 million, €1.1 million more over 2010. Sales grew by €2.16 million as well as sales to export markets (€13.34 million in total). During this period the deficit fell to €5 million, down €1.16 million over 2010. Average salary €745 The August average monthly nett salary per employee in Croatian companies was €745, according to data provided by the Central Bureau for Statistics. In relation to July, average nett salary in August was nominally higher by 2.8%, showing real growth of 2.9%. Year-on-year, average nett salary in August was 2.3% higher in nominal value and 0.3% in real value.

Jozo Vrdoljak fter having been selected by ‘The Sunday Times’ as one of top 100 small hotels in the world, Vestibul Hotel in Split has recently received local recognition at the Croatian Tourism Day. It won the Adrian award as the best small family hotel in Croatia. The Vestibul Palace Hotel is special in many ways. It was opened in 2005 and since then, due to its quality and efficient marketing, it has been visited by many famous people, from Formula 1 drivers (Jarno Trulli and Kimi Raikkonen), the CEO of Hugo Boss, world sailing champions, Star Trek actors, ambassadors, diplomats, managers of global companies, actors and singers.

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Unexpected visit The Sunday Times’ journalists were announced. We were informed about their appearance in this article of their daily edition, sold in over one and a half million copies, by the Director of the Croatian Tourist Board in London, Meri Matešić. We later found they would like to visit us, that is to perform an inspection, since we rank high in search engines and Split is a destination that has been registering a sudden tourism boom as well as the fact the hotel is of high architectural

value since it is situated in the middle of the Diocletian palace. Their journalist spent two days in our hotel, closely observing everything, pointed out Nenad Nizić, owner of Vestibul. The hotel was founded as the result of a successful merger of three palaces (Romanic, Gothic and Renaissance) as well as original Roman niches. It is located between the imperial Diocletian chambers and the imperial Peristil Square. In addition to the restaurant and kitchen, which was a prerequisite for categorisation, it has seven rooms, of which one is an imperial suite which costs €1,000 per night. It is interesting in that the kitchen has the remains of old Roman walls. Investment into this hotel totalled €1.2 million.

Wherever the visitor wants to go Staff of the hotel have an individual approach to visitors and will gladly transport them to the airport, an island or even Dubrovnik. There is also a tourist guide. Sustainability is achieved by non-accommodation services even though the average price of a room is €100 per night, points out Nizić. Furthermore, Vestibul has 12 permanent employees. In addition to the hotel, the Nizić family also owns the Dobrić Villa, also located in the old centre of Split. The hotel has been included in the prestigious group of Small Luxury Hotels of the World, in which only two hotels from the region are included, one from Dubrovnik and one from Bled.

PV International 0173  

PV International - The first weekly newsletter covering the Croatian economy as well as that of the wider region, in English

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