Issuu on Google+

Business in 2011 Even though it seems the number of entrepreneurs increased, many of them sustained losses during 2011, every third on average

Banking activity in 2011 Croatian banks will have to bear a substantial burden and pay the price for the recovery from the crisis

Wood industry This sector’s perspective should be improved by EU funds with well prepared projects

PAGES 2-7

PAGES 8-11

PAGES 12-13 2008 2009 2010 2011

Croatian Business & Finance Monthly Established in 1953 Monday / 3rd December / 2012 Year V / No 0220 www.privredni.hr

S U P P O R T E D

B Y

T H E

pvinternational pv international C R O A T I A N

C H A M B E R

O F

E C O N O M Y

LNG TERMINAL

Qatar to supply liquefied gas Qatar to supply gas for the Krk-based LNG terminal over the next 25 years, as announced following the recent meetings between the Croatian delegation and the Qatar Emir Al-Thani and his partners Igor Vukić atar Minister of Energy will visit Zagreb in the near term to discuss the technical and financial issues concerning the construction of the terminal. The investment will be fully specified by the end of March 2013, prior to the announced visit of Qatar Energy Minister to Rijeka. “Qatar recognised Croatia as one of five most favourable countries for expansion of its gas business a decade ago, due to her geographical position and her being the only Mediterranean country adjacent to Central Europe. The idea has been reconsidered and the implementation of the project will notably exceed the value of the investment and strengthen the business relationship between the two countries”, highlighted Nadan Vidošević, President of the Croatian Chamber of Economy (HGK) during the opening ceremony of the Qatar-Croatian economic forum recently held in Doha. According to Vidošević, the implementation of LNG project will generate substantial profits due to operations linked with its implementation, encouraging business development of sectors in Croatian economy which can provide competitive products and services. “It is important to highlight the importance of Croatian

Q

IT sector, health, food industry, construction, energy and electro mechanical engineering”, stated Vidošević. The most propitious moment for joint projects The Croatian delegation was led by the Croatian President Ivo Josipović, whilst 40 Croatian and 30 Qatari companies participated in the economic forum. Zvonimir Mršić, Board President of Podravka, Jure Radić from IGH, bankers Čedo Maletić (HPB), Markus Ferstl (Hypo) and Anton Kovačev (HBOR), Filip Filipec from Tehnika, Nikica Gabrić (Svjetlost Polyclinic) and many other entrepreneurs also participated at the forum.

President Josipović opened the Croatian delegation in Doha which will assist entrepreneurs during the implementation of the contracted work. “This is the most propitious moment for the launch of joint projects which will effectively exploit the potential of both countries”, stated Khalif Bin Jassim Al-Thani, President of Qatar Chamber of Commerce and Industry. Damir Novinić, Director of Agency for Investment and Competitiveness, gave the presentation entitled Croatia – Your Gateway to Europe, to present the advantages of investment in Croatia, such as her geo-strategic position and favourable invest-

ment terms to Qatari businessmen who showed substantial interest in investment in tourism and co-operation with Croatian companies concerning planning and implementation of construction projects. Trade in goods and services between Qatar and Croatia exceeded $52 million in 2012, with exports to Qatar slightly exceeding $51 million, whilst imports in Croatia stood at $1.7 million. During the first nine months this year exports stood at $21.4 million or 46.7% down in relation to the same period last year, whereas imports totalled $3 million or over 100% compared with the same period last year.


2

Privredni vjesnik Year V No 220

( HRK624.8 billion ( HRK2.3 billion in entrepreneurs’ revenue in 2011

of trade surplus

BUSINESS IN 2011

Difficult year of stagn better results

Even though it seems the number of entrepreneurs increased, many of them sustained losses during 2011, every thi Darko Buković ccording to data for each category (small, medium and big-sized companies), Croatian entrepreneurs ended 2011 more successfully compared with 2010. However, if we take into account that 2010 was a year of stagnation and fall, this result seems a positive one, though still a long way from the problems the entrepreneurs show and are faced with on a daily basis. In 2011, the entrepreneurs achieved total revenue of HRK624.8 billion, of which

A

Export is Croatia’s mantra, and economic growth cannot be expected without it HRK97.3 relates to the sales of goods on the foreign market, which is 10.1% more than in 2010. A total of HRK95 billion worth of goods was bought on the foreign markets, and trade surplus totalled HRK2.3 billion. In 2011, only 12,479 entrepreneurs placed their products and IMPRESSUM: Privredni vjesnik Kačićeva 9 10000 Zagreb +385 1 5600020 uprava@privredni.hr www.privredni-vjesnik.hr/ subscription

services on the foreign market, while the others (86,051) operated exclusively in Croatia. The year ended with HRK7.2 billion of net loss (profit minus loss after tax) to HRK2.3 billion of net profit in 2010. During that period 57,244 entrepreneurs achieved a profit of HRK32.9 billion, while 41,286 entrepreneurs sustained a total loss of HRK25.7 billion, according to FINA’s financial report of Croatian entrepreneurs in 2011. During the past five years, mainly entrepreneurs/tax payers operated actively, 98,530 of them who employed a total of 851,386 workers (based on working hours), which is 0.9% more employees compared with 2010. The growing number of the entrepreneurs during the past five years was followed by the number of entrepreneurs who achieved profit and the number of the entrepreneurs who achieved losses. The basic characteristic of the observed period is a high number of entrepreneurs who operated with losses, every third on average. In 2010, the number of entrepreneurs who sustained losses increased to 42.6%, and in 2011,

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

there were 41,286 of such entrepreneurs (41.9%). Small-sized are the most successful Export is Croatia’s mantra, and economic growth cannot be expected without it. Last year, a total of €6.6 billion worth of exports was achieved (+7.7%). However, €15.1 billion worth of goods was imported (+7.5%), achieving trade deficit of €6.7 billion (+7.3%). Export/import ratio remained almost the same - 58.9% compared with 58.8% in 2010. The negative influence of the goods deficit was reduced by the positive results of tourism,

and as a consequence, the balance of payments on the current account totalled -€446.3 million. It should be mentioned that smallsized entrepreneurs achieved HRK20 million of net profit, after HRK3.6 billion of net loss in 2010. Medium-sized entrepreneurs also decreased net loss by 42.9%, since they sustained HRK201 million of net loss, compared with HRK353 million of net loss in 2010. Big-sized entrepreneurs increased net profit by 17.5%, achieving HRK7.4 billion of net profit, compared with HRK6.3 billion of net loss in 2010. This is mostly the result of the shipbuilding’s one-off


www.privredni.hr Business & Finance Monthly

( 98,530

3

entrepreneurs/tax payers in 2011

( €6.7billion

of trade deficit in 2011

nation, but with rd on average

revenue due to the acquisition of property by the governmental decision. Big-sized entrepreneurs play a dominant role in the business of entrepreneurs. In 2011, they participated with 32.6% in the number of employees with a 0.4% share in the number of entrepreneurs, 48% in total revenue, 45% in the profit of the period, 28.9% in the loss of the period, 51.8% in investment in new fixed assets, and with 7.4 billion in net profit of the period (total profit minus total losses). Total result of entrepreneurs of all sizes was HRK7.2 billion (net profit of the period). In 2011, medium-sized entrepre-

neurs participated with a 1.3% share in the number of entrepreneurs, 18.4% in the number of the employed, 18.2% in total revenue, 12.8% in the profit of the period, 17.2% in the loss of the period (HRK201 million), and 16.2% in investment in new fixed assets. As in the European Union, small-sized entrepreneurs hold the largest share of 98.3% per number of entrepreneurs, 49.1% per number of the employed, 33.8% per total revenue, 42.2% per profit of the period, 53.9% per loss of the period, 32% per investment in fixed assets and 0.3% per net profit of the period (HRK20 million). For the past few years, the business report of entrepreneurs has been drawing attention to the importance of a certain small number of entrepreneurs. In 2011, top ten entrepreneurs per amount of net revenue achieved HRK89.4 billion or 14.3% out of HRK624.8 billion of total revenue of all 98,530 entrepreneurs. Three important activities As in the past, Ina stood out again. One of the features of the business operations of the Croatian entrepreneurs is a large concentration of business results in a relatively small number of entrepreneurs. This is confirmed by the share of the top ten entrepreneurs per achieved profit of the period (after-tax profit) of HRK10.5 billion. This exceeds total balance of profit of HRK7.2 billion of 98,530 entrepreneurs in 2011 (a large share of entrepreneurs achieved losses),

according to Fina’s report. The financial report of the Croatian entrepreneurs who pay profit tax (banks and insurance companies excluded), reveals there are three most important activities (processing industry, trade and information & communication), and they participate with 50% in total business results, as they have been during the past ten years. This was the case in 2011, when these three activities participated with 44.3% in total number of entrepreneurs, 53.1% in the number of the employed, 65.1% in total revenue, 65.2% in total expenditure, 65.3% in aftertax profit, 44.1% in losses after tax and 44.7% in total investment. Construction, expert, science and technical activities also stand out according to business results, while the importance of other activities is relatively small. This has been confirmed by the data for 2011. Out of 98,530 entrepreneurs 27,717 of them (28.1%) referred to trade. They are followed by expert, science and technical activities with 14,345 entrepreneurs (14.6%), construction with 12,351 entrepreneurs (12.5%) and processing industry with 11,817 entrepreneurs (12.0%). Zagreb takes the lead in terms of economy Although this is not anything new, Zagreb’s entrepreneurs dominate over the economic activity of Croatian entrepreneurs, and Zagreb is actually the centre of one third of all entrepreneurs. They achieve over a half of rev-

enue and profit with over 50% of assets and sources, according to the Fina’s report on entrepreneurs in counties for 2011.

Big-sized entrepreneurs play a dominant role in the business of entrepreneurs The report confirms the dominant role of the entrepreneurs operating in county centres. According to processed data, it appears the concentration of the financial results of the entrepreneurs in county centres is very large. The Counties of Zagreb, Krapina and Hrvatsko Zagorje, Lika and Senj, Vukovar and Srijem as well as the County of Istria are exceptions. In these counties, the economic activities are dispersed in two cities/counties or more, which diminishes the importance of the counties’ centre, according to data provided by Fina. In 2011, 19,535 entrepreneurs from the City of Zagreb earned HRK16.5 billion of after-tax profit, while 12,609 entrepreneurs sustained a loss of HRK10.6 billion. The consolidated financial result of the entrepreneurs from the City of Zagreb, that is, net profit (profit minus loss after tax) totals HRK5.8 billion, which is on the level of 2010. In 2011, the entrepreneurs from the City of Zagreb counted 339,072 employees who achieved a total revenue of HRK329.3 billion, which is 4.6% more compared with the year before.


4

Privredni vjesnik Year V No 220

Ranking of the top 100 for year RANK PER TOTAL REVENUE NUMBER OF EMPLOYEES

2011.

2010.

2009.

NAME, PLACE AND ADDRESS OF THE ENTREPRENEUR

1

1

1

INA D.D.

ZAGREB

AVENIJA VEĆASLAVA HOLJEVCA 10

2

2

2

KONZUM D.D.

ZAGREB

M. ČAVIĆA 1A

3

3

3

HRVATSKA ELEKTROPRIVREDA D.D.

ZAGREB

ULICA GRADA VUKOVARA 37

4

4

4

HRVATSKI TELEKOM D.D.

ZAGREB

SAVSKA CESTA 32

5

5

23

PRIRODNI PLIN D.O.O.

ZAGREB

ŠUBIĆEVA 29

28

6

9

9

OMV HRVATSKA D.O.O.

ZAGREB

JOSIPA MAROHNIĆA 1

66

7

6

6

HEP- PROIZVODNJA D.O.O.

ZAGREB

ULICA GRADA VUKOVARA 37

8

8

7

HEP-OPERATOR DISTRIBUCIJSKOG SUSTAVA D.O.O.

ZAGREB

ULICA GRADA VUKOVARA 37

9.058

9

7

5

ZAGREBAČKI HOLDING D.O.O.

ZAGREB

ULICA GRADA VUKOVARA 41

11.685

10

39

26

BRODOSPLIT-BRODOGRADILIŠTE D.O.O.

SPLIT

PUT SUPAVLA 19

2.686

11

12

12

TISAK D.D.

ZAGREB

SLAVONSKA AVENIJA 2

3.003

12

11

8

VIPNET D.O.O.

ZAGREB

VRTNI PUT 1

13

16

14

PLODINE D.D.

RIJEKA

RUŽIĆEVA 29

14

17

25

PETROKEMIJA D.D. TVORNICA GNOJIVA

KUTINA

ALEJA VUKOVAR 4

2.355

15

13

17

MERCATOR - H D.O.O.

SESVETE

LJUDEVITA POSAVSKOG 5

3.264

16

15

11

VINDIJA D.D. VARAŽDIN

VARAŽDIN

MEĐIMURSKA 6

1.083 1.603

17

14

10

18

398

8.381

19

21

33

20

20

21

18

22

22

23 24

8.633 11.725 409 5.666

2.246

900 2.702

PLIVA HRVATSKA D.O.O.

ZAGREB

PRILAZ BARUNA FILIPOVIĆA 25

BRODOGRAĐEVNA INDUSTRIJA 3. MAJ D.D.

RIJEKA

LIBURNIJSKA 3

2.071

LIDL HRVATSKA D.O.O. K.D

VELIKA GORICA

ULICA KNEZA LJUDEVITA POSAVSKOG 53

1.288

20

KAUFLAND HRVATSKA K.D.

ZAGREB

VILE VELEBITA 6

2.278

18

HRVATSKE ŠUME D.O.O.

ZAGREB

LJUDEVITA FARKAŠA VUKOTINOVIĆA 2

8.539

44

EURO PETROL D.O.O.

RIJEKA

MARTINKOVAC 143 B

25

28

ORBICO D.O.O.

ZAGREB

KOTURAŠKA 69

533

23

22

MEDIKA D.D.

ZAGREB

CAPRAŠKA 1

336

25

19

16

METRO CASH & CARRY D.O.O.

ZAGREB

JANKOMIR 31

886

26

26

21

PODRAVKA D.D.

KOPRIVNICA

ANTE STARČEVIĆA 32

3.571

27

31

53

SPAR HRVATSKA DOO

ZAGREB

SLAVONSKA AVENIJA 50

1.658

28

24

24

PHOENIX FARMACIJA D.D.

ZAGREB

OZALJSKA 95

475

286

29

27

29

DUKAT D.D.

ZAGREB

MARIJANA ČAVIĆA 9

1.311

30

33

62

BOXMARK LEATHER D.O.O.

TRNOVEC BARTOLOVEČKI

GOSPODARSKA 12

2.561

31

41

43

CROATIA AIRLINES DD

ZAGREB

BANI 75 B, BUZIN

1.071

32

44

51

BELJE D.D.

DARDA

SVETOG IVANA KRSTITELJA 1A

1.798

33

10

13

ULJANIK BRODOGRADILIŠTE DD

PULA

FLACIUSOVA 1

1.933

34

36

38

PIK VRBOVEC - MESNA INDUSTRIJA D.D. VRBOVEC

VRBOVEC

ZAGREBAČKA 148

1.494

35

67

50

ŽITO D.O.O.

OSIJEK

ĐAKOVŠTINA 3

497

36

71

34

P.Z.AUTO D.O.O.

VELIKA GORICA

ZAGREBAČKA 117

121

37

30

19

AGROKOR-TRGOVINA D.D.

ZAGREB

TRG DRAŽENA PETROVIĆA 3

38

29

31

HP-HRVATSKA POŠTA D.D.

ZAGREB

JURIŠIĆEVA 13

39

45

69

AGROKOR D.D.

ZAGREB

TRG D.PETROVIĆA 3

312

40

46

96

TIFON D.O.O.

ZAGREB

A. VON HUMBOLDTA 4

466

34 10.086

41

34

36

DM-DROGERIE MARKT D.O.O.

ZAGREB

KOVINSKA 5A

42

47

57

PHILIP MORRIS ZAGREB D.O.O.

ZAGREB

SAVSKA OPATOVINA 36

118

43

70

158

LUKOIL CROATIA D.O.O.

ZAGREB

ULICA GRADA VUKOVARA 284

351

44

38

39

MEDICAL INTERTRADE D.O.O.

SVETA NEDELJA

DR. FRANJE TUĐMANA BR. 3

385

45

32

27

TDR D.O.O.

ROVINJ

OBALA V.NAZORA 1

519

46

28

32

M SAN GRUPA D.D.

ZAGREB

BUZINSKI PRILAZ 10

112

47

40

41

HRVATSKA RADIOTELEVIZIJA

ZAGREB

PRISAVLJE 3

3.292

48

37

35

BILLA D.O.O.

ZAGREB (NOVI ZAGREB)

JADRANSKA AVENIJA 2

1.453

Source: Boniteti.hr

1.030


www.privredni.hr Business & Finance Monthly

5

2011 amounts in HRK TOTAL REVENUE

REVENUE FROM EXPORT

RANK

28.103.578.618

10.471.077.854

AFTER-TAX PROFIT

1

RANK

VALUE OF ASSETS

1.966.735.423

2

RANK

CAPITAL AND RESERVES

29.794.693.353

2

PROFIT SHARE IN TOTAL REVENUE

RANG

PROFIT SHARE IN TOTAL ASSETS

14.281.973.246

3

6,998%

6,601% 3,683%

13.359.497.278

179.226.395

87

345.228.963

9

9.372.626.319

11

2.554.835.353

10

2,584%

13.053.139.152

49.879.258

163

470.098.449

6

27.798.486.717

3

19.990.882.918

2

3,601%

1,691%

7.838.682.931

567.688.560

18

1.813.295.188

3

13.113.069.605

7

11.162.721.598

4

23,133%

13,828%

7.060.118.360

28.473.483

178

322.952

310

1.892.678.060

44

-793.248.225

396

0,005%

0,017%

4.652.426.116

231.807.200

70

25.152.397

86

1.341.664.258

67

857.126.077

39

0,541%

1,875%

4.092.209.643

0

294

0

324

10.690.508.719

9

-8.225.308

373

0,000%

0,000%

3.990.613.282

0

294

278.503.242

11

14.932.271.827

5

278.523.242

112

6,979%

1,865%

3.750.321.455

3.201.465

239

0

324

21.148.763.756

4

6.732.346.689

5

0,000%

0,000%

3.513.268.843

707.769.662

13

1.565.759.782

4

3.470.894.200

22

-2.374.644.421

400

44,567%

45,111%

3.249.264.095

5.866.920

226

23.970.469

90

974.857.051

103

416.109.830

81

0,738%

2,459%

3.097.430.979

321.839.716

49

389.400.996

8

2.943.165.639

26

1.218.201.353

26

12,572%

13,231%

2.983.560.664

0

294

35.033.847

71

2.950.101.697

25

334.659.235

98

1,174%

1,188%

2.969.649.519

1.911.564.334

2

107.825.182

26

1.646.822.131

54

765.109.515

42

3,631%

6,547%

2.875.554.833

76.711

284

0

324

3.767.544.939

19

1.590.823.824

18

0,000%

0,000%

2.794.655.630

157.175.156

97

12.893.864

143

2.141.393.985

37

668.489.412

47

0,461%

0,602%

2.760.460.298

1.877.567.011

3

417.665.900

7

8.149.756.681

12

3.059.626.517

9

15,130%

5,125%

2.682.679.222

204.237

279

2.624.780.199

1

4.538.918.840

17

-386.657.825

391

97,842%

57,828%

2.419.036.034

0

294

0

324

3.117.152.772

24

2.256.362.309

12

0,000%

0,000%

2.385.047.049

0

294

0

324

1.907.872.035

43

966.712.768

31

0,000%

0,000%

2.378.125.655

146.566.801

101

3.146.780

236

2.266.140.058

34

1.242.147.667

25

0,132%

0,139%

2.284.787.349

3.002.339

242

24.258.515

88

917.170.016

109

352.733.300

94

1,062%

2,645%

2.170.698.120

25.507.542

183

6.361.106

194

575.985.576

145

42.152.905

270

0,293%

1,104%

2.100.245.734

2.028.788

248

12.445.271

146

1.758.754.666

47

309.402.019

104

0,593%

0,708%

2.081.204.593

880.983

261

70.792.140

44

420.900.293

185

86.465.168

202

3,401%

16,819%

1.972.568.069

736.601.343

12

6.770.715

188

2.751.086.129

27

1.161.169.841

28

0,343%

0,246%

1.913.517.884

0

294

0

324

1.122.077.088

84

84.945.291

206

0,000%

0,000%

1.886.896.491

8.849

292

0

324

1.343.675.793

66

300.470.995

107

0,000%

0,000%

1.872.789.997

213.424.401

74

122.105.869

24

1.504.414.432

60

1.020.639.668

30

6,520%

8,117%

1.832.407.709

1.803.937.192

4

72.348.095

42

1.089.186.413

86

509.212.787

67

3,948%

6,642%

1.751.944.142

993.599.866

7

0

324

1.516.403.997

57

42.311.796

268

0,000%

0,000%

1.742.870.986

69.584.488

142

0

324

3.811.101.076

18

1.169.177.032

27

0,000%

0,000%

1.739.242.839

1.502.522.964

5

2.635.695

244

1.733.201.814

50

73.248.412

220

0,152%

0,152%

1.702.263.706

164.812.523

94

65.803.876

49

1.148.653.380

82

414.883.120

84

3,866%

5,729%

1.684.753.020

169.736.331

91

66.659.929

47

1.746.358.643

48

649.874.847

49

3,957%

3,817%

1.673.567.592

1.003

293

32.332.812

76

402.865.260

191

110.942.812

183

1,932%

8,026%

1.659.967.727

203.110.212

77

23.244.708

94

849.576.028

122

31.682.784

296

1,400%

2,736%

1.654.490.647

44.469.880

165

16.678.111

121

1.377.398.591

64

648.020.916

51

1,008%

1,211%

1.644.851.446

24.547.102

184

258.617.019

13

13.195.843.412

6

2.321.820.725

11

15,723%

1,960%

1.623.242.211

0

294

0

324

687.049.629

132

367.898.567

93

0,000%

0,000%

1.616.595.105

33.996.790

174

78.143.087

40

378.026.580

202

213.980.148

136

4,834%

20,671%

1.614.093.756

0

294

13.236.710

142

313.386.334

225

15.939.388

329

0,820%

4,224%

1.613.562.308

13.052.274

211

0

324

554.073.002

149

-102.137.023

385

0,000%

0,000%

1.554.707.800

3.595.953

237

22.761.188

96

1.084.619.296

87

68.808.674

226

1,464%

2,099%

1.551.658.608

427.591.332

37

293.356.889

10

2.417.599.799

32

1.367.656.481

21

18,906%

12,134%

1.516.510.954

426.399.681

38

11.408.732

153

896.784.416

110

235.717.559

130

0,752%

1,272%

1.431.232.733

18.336.229

195

0

324

1.041.095.210

92

168.266.391

150

0,000%

0,000%

1.405.464.426

0

294

0

324

540.433.389

153

830.430

362

0,000%

0,000%


6

Privredni vjesnik Year V No 220

RANK PER TOTAL REVENUE NUMBER OF EMPLOYEES

2009.

49

43

60

HEP OPERATOR PRIJENOSNOG SUSTAVA D.O.O.

ZAGREB

KUPSKA 4

50

58

73

RENAULT NISSAN HRVATSKA D.O.O.

ZAGREB

RADNIČKA CESTA 47

2011.

2010.

NAME, PLACE AND ADDRESS OF THE ENTREPRENEUR

1.212 65

51

50

48

HRVATSKE AUTOCESTE

ZAGREB

ŠIROLINA 4

2.740

52

42

42

HŽ INFRASTRUKTURA D.O.O.

ZAGREB

MIHANOVIĆEVA 12

6.802

53

69

97

PETROL HRVATSKA D.O.O.

ZAGREB

OREŠKOVIĆEVA 6 H

54

57

55

OKTAL PHARMA D.O.O.

ZAGREB

UTINJSKA 40

55

51

72

SPLIT

DOMOVINSKOG RATA 93

1.339

56

55

54

VARAŽDIN

JALKOVEČKA BB

1.655

184 309

57

49

49

TOMMY D.O.O. KOKA PERADARSKO PREHRAMBENA INDUSTRIJA DIONIČKO DRUŠTVO VARAŽDIN KONČAR ENERGETSKI TRANSFORMATORI D.O.O.

ZAGREB

JOSIPA MOKROVIĆA 12

58

54

85

GRADSKA PLINARA ZAGREB-OPSKRBA D.O.O.

ZAGREB

RADNIČKA CESTA 1

149

59

64

67

LEDO D.D.

ZAGREB

MARIJANA ČAVIĆA 9

1.095 1.159

542

60

61

77

JAMNICA DD

ZAGREB

GETALDIĆEVA 3

61

60

66

DINOVA-DIONA D.O.O.

ZAGREB

DONJE SVETICE 127

1.714

62

52

40

ERICSSON NIKOLA TESLA D.D. ZAGREB

ZAGREB

KRAPINSKA 45

1.607

63

65

63

ATLANTIC TRADE D.O.O.

ZAGREB-SUSEDGRAD

JOSIPA LONČARA 9

551

64

66

65

KTC D.D.

KRIŽEVCI

NIKOLE TESLE 18

728

65

79

105

TLM TVP ZA PROIZVODNJU VALJANIH PROIZVODA D.O.O.

ŠIBENIK

NARODNOG PREPORODA 12

572

66

80

83

ZVIJEZDA D.D.

ZAGREB

MARIJANA ČAVIĆA 1

666

67

78

95

TELE2 D.O.O.

ZAGREB

ULICA GRADA VUKOVARA 269D

68

35

15

DALEKOVOD D.D.

ZAGREB

M. ČAVIĆA 4

69

72

56

BRODOMERKUR TRGOVINA I USLUGE D.D.

SPLIT

POLJIČKA CESTA 35

70

53

46

KERUM D.O.O.

SPLIT

ZRINJSKO FRANKOPANSKA 68

71

73

78

STUDENAC

OMIŠ

ČETVRT RIBNJAK 17.

105 1.153 570 810 1.402

72

85

86

SIEMENS D.D.

ZAGREB

HEINZELOVA 70A

802

73

82

75

MESNA INDUSTRIJA BRAĆA PIVAC D.O.O.

VRGORAC

TEŽAČKA 13

638

74

62

89

TANKERSKA PLOVIDBA D.D.

ZADAR

BOŽIDARA PETRANOVIĆA 4

810

75

168

137

BRODOTROGIR D.D.

TROGIR

PUT BRODOGRADITELJA 16

1.217

76

76

76

HŽ CARGO D.O.O.

ZAGREB

MIHANOVIĆEVA 12

2.255

77

87

100

PBZ CARD D.O.O.

ZAGREB

RADNIČKA CESTA 44

78

96

106

TE PLOMIN D.O.O.

PLOMIN

PLOMIN LUKA BB

79

75

79

HŽ VUČA VLAKOVA D.O.O.

ZAGREB

MIHANOVIĆEVA 12

80

93

98

ZAGREBAČKA PIVOVARA D.O.O.

ZAGREB

ILICA 224

242 0 2.095 466

81

48

80

BINA-ISTRA D.D.

LUPOGLAV

ZRINŠČAK

82

86

84

KRAŠ,D.D. ZAGREB

ZAGREB

RAVNICE 48

1.588

9

83

88

94

JADROLINIJA

RIJEKA

RIVA 16

2.235

84

84

81

COCA COLA HBC HRVATSKA D.O.O.

ZAGREB

MILANA SACHSA 1

482

85

83

101

ALCA ZAGREB D.O.O.

ZAGREB

KOLEDOVČINA 2

846

86

210

416

CE-ZA-R D.O.O.ZAGREB

ZAGREB-SUSEDGRAD

JOSIPA LONČARA 15

245

87

101

108

FRANCK D.D

ZAGREB

VODOVODNA 20

500

88

100

129

VIRO TVORNICA ŠEĆERA D.D.

VIROVITICA

MATIJE GUPCA 254

244

89

105

114

BENETTON TEKSTIL D.O.O.

LABIN

VINEŽ 600

511

90

63

58

ZAGORJE-TEHNOBETON D.D.

VARAŽDIN

PAVLEKA MIŠKINE 49

91

91

92

HŽ PUTNIČKI PRIJEVOZ D.O.O.

ZAGREB

MIHANOVIĆEVA 12

1.133

881

92

97

64

VIADUKT D.D.

ZAGREB

KRANJČEVIĆEVA 2

980

93

98

128

BELIŠĆE D.D.

BELIŠĆE

TRG ANTE STARČEVIĆA 1

94

92

93

FINANCIJSKA AGENCIJA

ZAGREB

VRTNI PUT 3

95

94

90

AWT INTERNATIONAL D.O.O.

ZAGREB

SLAVONSKA AVENIJA 52/2

96

74

30

ENI CROATIA B.V. - HRVATSKA PODRUŽNICA

ZAGREB

ŠUBIĆEVA 29

97

95

68

TEHNIKA D.D.

ZAGREB

ULICA GRADA VUKOVARA 274

1.124

98

102

74

OSIJEK-KOTEKS D.D.

OSIJEK

ŠAMAČKA 11

1.029

99

106

102

ADRIS GRUPA D.D.

ROVINJ

OBALA V.NAZORA 1

100

68

45

CROSCO,NAFTNI SERVISI D.O.O.

ZAGREB

ULICA GRADA VUKOVARA 18

978 2.930 441 2

37 1.807


www.privredni.hr Business & Finance Monthly

7 amounts in HRK

TOTAL REVENUE

REVENUE FROM EXPORT

RANK

AFTER-TAX PROFIT

RANK

VALUE OF ASSETS

RANK

CAPITAL AND RESERVES

PROFIT SHARE IN TOTAL REVENUE

RANG

PROFIT SHARE IN TOTAL ASSETS

1.395.414.411

57.504.491

154

107.716.411

27

4.748.048.409

15

107.776.411

185

7,719%

2,269%

1.380.079.123

650.419.997

14

6.032.579

198

224.748.291

266

38.305.376

281

0,437%

2,684%

1.352.129.908

0

294

0

324

44.647.417.936

1

22.402.950.037

1

0,000%

0,000%

1.348.521.845

0

294

0

324

11.208.199.934

8

6.334.519.928

6

0,000%

0,000%

1.325.558.768

18.092

289

0

324

639.357.370

138

279.165.456

111

0,000%

0,000%

1.324.510.100

27.333.110

180

7.923.956

180

991.087.242

101

126.004.485

175

0,598%

0,800%

1.309.547.000

0

294

14.613.141

131

474.196.558

169

30.120.680

301

1,116%

3,082%

1.295.198.350

203.100.235

78

6.519.369

192

1.228.519.820

75

533.332.555

61

0,503%

0,531%

1.290.873.973

1.218.125.575

6

272.213.198

12

1.009.393.096

96

527.260.541

63

21,088%

26,968%

1.257.221.306

0

294

6.126.462

195

320.601.349

223

68.561.902

227

0,487%

1,911%

1.255.074.491

184.827.932

84

126.806.513

22

1.185.472.745

78

865.380.676

38

10,104%

10,697%

1.243.482.228

200.698.487

79

100.247.260

30

1.331.933.088

68

920.611.104

34

8,062%

7,526%

1.223.833.612

0

294

517.749

299

525.097.611

159

192.066.632

142

0,042%

0,099%

1.214.804.791

902.968.633

8

27.976.483

82

1.190.997.475

77

850.906.529

40

2,303%

2,349%

1.160.291.207

220.567

276

12.052.249

149

499.081.119

165

65.708.284

230

1,039%

2,415%

1.110.988.016

0

294

18.068.507

113

663.023.293

136

101.436.851

192

1,626%

2,725%

1.106.299.664

780.872.773

10

0

324

1.002.973.708

97

118.314.917

178

0,000%

0,000%

1.093.863.972

169.450.709

93

39.622.573

67

1.272.247.575

72

953.685.511

33

3,622%

3,114%

1.076.289.616

37.075.427

171

0

324

1.268.448.105

73

153.981.637

154

0,000%

0,000%

1.076.000.152

399.921.708

42

0

324

2.273.047.356

33

578.284.285

53

0,000%

0,000%

1.065.785.789

20.226.351

190

1.452.073

272

852.543.907

121

245.496.743

124

0,136%

0,170%

1.064.885.841

0

294

50.484.686

59

990.102.755

102

85.033.818

205

4,741%

5,099%

1.064.143.894

0

294

43.715.978

64

433.105.102

182

63.421.186

240

4,108%

10,094% 3,898%

1.040.871.447

275.453.539

61

16.195.454

124

415.505.796

186

135.749.566

169

1,556%

1.035.398.996

13.204.171

210

38.070.948

69

488.702.006

167

306.616.367

105

3,677%

7,790%

1.020.012.422

898.378.326

9

0

324

3.767.484.008

20

1.718.905.634

14

0,000%

0,000%

994.852.864

389.176.644

43

139.486.744

20

959.464.267

105

-1.666.742.743

399

14,021%

14,538%

978.967.099

525.253.075

23

574.176

296

1.862.078.158

45

291.474.442

110

0,059%

0,031%

974.748.462

17.675.512

196

220.998.641

15

2.071.500.207

39

706.821.221

44

22,672%

10,669%

956.160.450

0

294

11.514.294

151

865.444.395

114

241.984.606

127

1,204%

1,330%

948.918.729

0

294

0

324

1.781.333.967

46

378.677.310

88

0,000%

0,000%

946.171.476

53.305.440

158

249.060.283

14

678.873.292

133

342.816.841

96

26,323%

36,687% 0,000%

936.931.341

0

294

0

324

4.912.459.132

14

-541.099.624

395

0,000%

929.653.648

321.179.536

50

14.017.299

136

1.196.377.720

76

615.851.917

52

1,508%

1,172%

920.875.728

164.659.367

95

2.025.724

257

1.049.687.993

91

474.044.964

72

0,220%

0,193% 12,096%

914.931.977

84.963.440

136

56.260.942

58

465.137.707

174

305.645.502

106

6,149%

900.036.165

3.121.595

241

15.345.239

128

728.077.074

127

238.234.021

129

1,705%

2,108%

888.781.191

646.510.456

15

81.656.745

39

338.139.875

217

189.520.954

143

9,187%

24,149%

883.031.407

104.253.153

127

42.186.655

65

1.056.537.281

90

551.202.878

57

4,777%

3,993%

877.302.436

325.714.977

48

122.560.221

23

1.027.565.883

94

532.440.254

62

13,970%

11,927%

868.640.888

744.765.788

11

66.575.938

48

864.004.245

115

480.977.415

70

7,664%

7,706%

868.141.105

112.238.855

124

9.251.676

164

969.068.113

104

299.573.600

108

1,066%

0,955%

855.591.006

52.775.921

159

0

324

1.697.458.960

51

297.764.700

109

0,000%

0,000%

846.875.794

150.270.517

100

1.752.046

267

825.308.072

123

202.677.014

140

0,207%

0,212%

827.103.222

527.898.332

21

2.651.212

243

1.012.369.595

95

462.665.556

74

0,321%

0,262%

815.046.976

17.754

290

60.025.647

56

1.671.168.154

53

1.477.010.650

20

7,365%

3,592%

811.702.990

4.855.895

228

33.875.403

73

323.078.450

222

75.887.827

215

4,173%

10,485%

805.852.696

616.928.646

16

96.814.197

31

2.078.401.123

38

1.606.509.442

16

12,014%

4,658%

800.016.807

8.944

291

1.029.416

279

1.367.158.916

65

334.690.740

97

0,129%

0,075%

789.323.717

21.574.242

188

0

324

861.228.762

117

-63.284.106

382

0,000%

0,000%

766.454.533

1.110.864

258

586.394.131

5

6.474.405.166

13

5.845.381.080

7

76,507%

9,057%

765.655.434

514.601.232

25

40.078.208

66

1.742.766.936

49

648.897.966

50

5,234%

2,300%


8

Privredni vjesnik Year V No 220

( 4.05%

increase in bank assets in 2011

( 29.66%

skyrocketing state loan

BANKING ACTIVITY IN 2011

Stable banks within

Croatian banks will have to bear a substantial burden and pay the price for the recovery from the crisis, irrespective o with majority foreign ownership (around 90%) and of their being primarily profit and income oriented Žarko Primorac, Ph.D rrespective of all the hardships and challenges encountered, banking activity in 2011 was significant, primarily due to a substantial increase in business promoters, as well as retained overall stability, liquidity and profitability. Total assets of banks increased by 4.05%, due to a 6.3% growth in loans and this was an excellent result against the backdrop of the recession. State loans, soaring by 29.66%, primarily accounted for the increased loan activity, whilst loan programmes for the development of the economy saw a 5.04% increase and retail loans a mere 0.84% rise. The increase in loans to the state and its institutions indicates severe problems in financing of the state functions,

I

Credit crunch phenomenon is not only typical of Croatian banks due to serious problems in maintaining budget balance. Moreover, it indicates the fact that banks are more than willing to grant loans to the state, since the state is by definition the lowest-risk client. It needs to be highlighted that this channel uses most of domestic liquidity, which should primarily be intended for loan programmes for the development of the economy and for retail loans. Increase in loan programmes for the development of the economy of around 5% is absolutely unacceptable and insufficient for effective functioning and dynamising of the sector, since financing

is one of the crucial prerequisites for the enhancement of economic activity and exiting the recession. Credit crunch phenomenon is not only typical of Croatian banks, having pervaded the entire European banking industry as one of the consequences of the financial crisis and severely hindering the exit from the crisis. Reduced lending is due to a substantial increase in risk-sensitivity in banking, lack of corporate projects eligible for bank loans, or low lending demand and yet simultaneously high interest rates and the overall financing costs. Decrease in retail lending is a conse-

quence of increased unpopularity of borrowing amongst the general public, nearly non-existent job security, increasing unemployment and youth unemployment, stagnation or decrease in real salaries and the requirement for settlement of consumption loans. Bank deposits saw a mere 1.13% increase in 2011, with state deposits soaring by around 15%, retail deposits rising by 4.24%, whilst deposits in economy saw a 7.57% decrease. A dramatic decrease in deposits in economy indicates severe liquidity problems due to the fact that registered illiquidity in economy stood at

around HRK42 billion towards the end of 2011. Illiquidity is a long-term problem of Croatian economy, as it has to a certain extent been inherited from the previous system. It is also a problem for the entire system and hence requires a thorough analysis of the real sector and implementation of severe measures to decrease irrationalities, losses and excessive public sector expenses, to name a few. In addition, fresh liquidity and curbing financing costs are fundamental, with banks having a crucial role. Increasing retail deposits within the recession indicate a typical


www.privredni.hr Business & Finance Monthly

9

( 1.13%

deposit growth in 2011

( 72.5%

loans with foreign currency clause

unstable economy

of the fact that they are mainly privately owned (over 96%), their assets

behavioural pattern amongst the general public during a financial crisis. Retail deposits are growing, as a result of increased savings for retirement, for the purchase of a home, savings for children’s education and due to the lack of job security, irrespective of reduced earnings and high borrowing. New financing model, more severe competition Croatian banks will increasingly focus on total deposits and primarily on retail deposits, to keep abreast with other European countries where their parent com-

panies are located. Banks need to strengthen their capital basis and increase liquidity, which will probably result in reduction of the borrowing potential of domestic banks from their foreign parent companies. Consequently, West-European banks will reduce their exposure in the countries of Central and South-East Europe and in Croatia, which does not imply imminent threat of capital reduction and borrowing of Croatian banks. Nevertheless, it indicates an important warning and is a signal for banks to increasingly rely on local currency financing. The new financing model will result in increasingly severe competition amongst banks for local currency deposits, occurring simultaneously with credit crunch policy in West-European banks. Croatian banking sector is deeply pervaded by Euroisation, as, due to foreign currency clause, 72.5% of loans are denominated in foreign currency, with 15.5% of loans being denominated in the Swiss franc (CHF). It is also important to highlight that the issuance of new base money by the Croatian National Bank is considerably affected by foreign currency transactions. Banks will need to develop a strong reorientation strategy towards local currency financing, against the backdrop of the overall reduction of foreign currency inflow, due to deleveraging, decreased foreign investment, lower state borrowing abroad in order to reduce public consumption and substantially weaker exports. Consequently, interest margins are likely to be lowered, since banks will encourage new deposits and retail savings by increasing of passive interest rates.

Large banks such as ZagrebaÄ?ka, Privredna and other banks ranking amongst top five achieved the best financial results, whilst the situation amongst small banks is seriously alarming. Hence, nine small banks recorded negative financial results yet again. Nevertheless, financial losses were 62.19% down in relation to the previous year. However, the fact that small banks, which need to

Nine small banks recorded negative financial results yet again provide financing for small and medium-sized companies that abound in Croatia, operate with negative results, exhausting their capital base and liquidity, is highly alarming. Such banks will need to implement carefully planned revitalisation programmes, as well as consider joining large banks or grouping, as it is evident they might encounter serious survival hurdles within severe financing conditions and a strengthened competition for deposits. Moreover, Croatian EU accession will further contribute to strengthening the conditions for competition on the local market with the appearance of new players in

the market, the possibility of direct operation of European banks in this market, with the policy of unique licence and other measures which will adversely impact on the market position and operation of small banks. Banks against the recession Domestic banks need to actively implement programmes to tackle the recession. Croatian banks will have to bear a substantial burden and pay the price for the recovery from the crisis, irrespective of the fact that they are mainly privately owned (over 96%), their assets with majority foreign ownership (around 90%) and of their being primarily profit and income oriented. Since banks have significantly impacted on the global financial crisis, several countries have imposed financial transaction tax or property taxation to foster social recovery. Similar ideas have pervaded the European Union. Nevertheless, some EU member countries such as Great Britain have strongly opposed it thus far. Croatia has not yet considered this issue, yet she might do so if faced with economic stagnation and in case banks are not sensitive to the aggravated economic and social conditions in the country.


10

Privredni vjesnik Year V No 220

Ranking of Croatian banks for y RANK

EQUITY - ,

SUBSCRIBED CAPITAL

CAPITAL ADEQUACY COEFFICIENT

BANK 2011.

2010.

1

1

Zagrebačka banka

14.754.023

3,82

6.404.839

400,00

1

21,72

2

2

Privredna banka Zagreb

10.057.341

6,02

1.907.477

0,00

4

21,48

3

5

Erste und Steiermärkische Bank

5.686.841

5,72

1.698.418

0,00

5

15,12

4

3

Hypo Alpe-Adria-Bank

5.366.756

-12,13

5.208.760

-12,60

2

26,11

5

4

Raiffeisenbank

5.289.510

-1,81

3.633.632

-2,09

3

17,41

6

6

Societe Generale - Splitska banka

3.458.238

4,20

491.426

0,00

9

15,99

7

7

Volksbank

1.563.378

-3,95

1.530.668

0,00

6

28,38

8

8

OTP banka

1.330.320

-2,75

989.607

0,00

7

14,75

9

9

Hrvatska poštanska banka

1.116.626

3,24

966.640

0,00

8

14,20

10

10

Međimurska banka

368.047

-0,57

127.900

0,00

22

20,10

11

12

Podravska banka

330.161

-0,48

267.500

0,00

13

16,61

12

13

Banco Popolare Croatia

320.707

12,54

332.980

12,12

10

14,49

13

11

Jadranska banka

319.447

1,28

239.246

0,00

15

15,96

14

14

Štedbanka

283.585

2,01

250.000

0,00

14

29,85

15

15

Croatia banka

274.792

0,00

274.600

0,00

11

15,23

16

16

Kreditna banka Zagreb

268.323

-0,08

230.200

0,00

16

15,50

17

17

Istarska kreditna banka

237.015

3,19

162.800

0,00

20

15,13

18

19

Centar banka

191.728

-0,92

138.700

0,00

21

13,11

19

20

Partner banka

175.072

2,32

89.100

0,00

26

14,40

20

21

Slatinska banka

173.469

2,56

91.897

0,00

25

18,86

21

18

Veneto banka

162.638

-18,13

270.000

0,00

12

18,13

22

23

BKS Bank

134.526

0,27

120.000

0,00

23

15,98

23

22

VABA

123.980

-11,76

176.523

0,00

18

12,43

24

25

Imex banka

119.880

10,10

93.127

54,88

24

14,62

25

28

Banka Kovanica

89.085

68,29

208.964

46,17

17

15,32

26

26

Karlovačka banka

84.711

-15,67

164.373

0,00

19

12,69

27

27

Samoborska banka

84.561

-0,37

51.942

0,00

29

30,66

28

29

Banka Brod

54.918

0,37

51.228

0,00

30

14,01

29

30

Banka splitsko-dalmatinska

51.138

1,24

48.602

0,00

31

17,66

30

31

Primorska banka

28.015

-29,42

55.440

0,00

28

45,61

31

33

Nava banka

25.139

74,32

72.698

70,26

27

14,47

32

32

Tesla štedna banka

23.718

30,32

32.736

79,87

32

204,99

Source: Data press

HRK000

CHANGES

HRK000

CHANGES

RANK


www.privredni.hr Business & Finance Monthly

11

ear 2011 ASSETS HRK000

CHANGES

ASSETS PER EMPLOYEE (HRK000)

RANK

PROFIT BEFORE TAX

PROFIT AFTER TAX

NUMBER OF EMPLOYEES

COST-TOINCOME RATIO

CAPITAL/ASSETS X 100

PROFIT BEFORE TAX / CAPITAL X 100

PROFIT BEFORE TAX / ASSETS X 100

104.005.057

8,16

1

22.939

1.628.000

1.316.000

4.534

44,12

14,19

11,03

1,57

67.481.066

0,19

2

18.966

1.376.296

1.136.336

3.558

41,96

14,90

13,68

2,04

57.035.084

12,92

3

28.503

803.106

650.568

2.001

37,50

9,97

14,12

1,41

41.085.738

5,51

4

23.626

54.911

42.361

1.739

54,81

13,06

1,02

0,13

38.460.007

-4,85

5

17.514

382.512

326.480

2.196

53,14

13,75

7,23

0,99

26.767.681

0,09

6

16.985

181.774

138.219

1.576

58,00

12,92

5,26

0,68

7.495.198

-2,92

9

16.582

2.404

868

452

66,02

20,86

0,15

0,03

12.772.353

0,11

8

12.584

124.811

99.447

1.015

62,86

10,42

9,38

0,98

16.451.826

11,26

7

15.361

82.396

87.924

1.071

70,10

6,79

7,38

0,5

2.830.292

-2,96

12

12.414

40.751

32.476

228

60,50

13,00

11,07

1,44

2.911.750

4,10

10

9.273

15.636

12.466

314

74,89

11,34

4,74

0,54

2.650.635

11,03

14

8.835

11.450

10.854

300

81,28

12,10

3,57

0,43

2.878.558

7,66

11

11.654

3.517

3.517

247

74,48

11,10

1,10

0,12

1.304.010

5,06

22

28.348

30.375

23.688

46

30,29

21,75

10,71

2,33

1.884.678

-0,40

18

6.590

(8.033)

(8.033)

286

128,27

14,58

-

-

2.705.450

28,29

13

14.391

15.104

11.951

188

66,18

9,92

5,63

0,56

2.540.871

5,10

15

11.293

23.292

18.729

225

64,22

9,33

9,83

0,92

1.600.295

-0,15

19

13.117

3.285

2.548

122

74,94

11,98

1,71

0,21

1.311.986

0,92

21

10.843

261

317

121

78,85

13,34

0,15

0,02

1.331.201

8,54

20

7.651

4.577

3.327

174

83,65

13,03

2,64

0,34

1.147.189

0,34

24

11.138

(30.217)

(30.217)

103

102,00

14,18

-

-

1.073.506

42,50

26

17.315

44

55

62

89,88

12,53

0,03

0,00

1.236.257

-13,37

23

7.188

(13.456)

(13.456)

172

84,00

10,03

-

-

1.904.906

20,87

16

14.999

25.328

20.146

127

41,44

6,29

21,13

1,33

1.121.377

-13,52

25

8.431

(28.691)

(28.691)

133

57,02

7,94

-

-

1.884.854

-18,40

17

7.953

(14.098)

(14.098)

237

143,80

4,49

-

-

409.914

5,74

28

7.883

1421

1.138

52

90,84

20,63

1,68

0,35

528.920

0,52

27

6.080

(8.123)

(8.123)

87

79,92

10,38

-

-

342.245

15,79

29

4.960

540

358

69

0,70

14,94

1,06

0,16

185.720

4,53

31

4.319

(9.624)

(9.624)

43

255,00

15,08

-

-

287.165

0,41

30

11.965

(14.561)

(14.561)

24

241,00

8,75

-

-

34.821

224,52

32

1.833

(8.898)

(8.898)

19

1.170,30

68,11

-

-


12

Privredni vjesnik Year V No 220

( $601 million ( $357 million of exports in 8 months of this year

of imports in 8 months of 2012

WOOD INDUSTRY

A new wave of recess

During the first eight months of this year exports showed a 5.1% fall. However, the balance of the goods exchange increased in the meantime by several million kuna due to a heavier fall in imports Krešimir Sočković espite the fact Croatia has remarkable natural and renewable resources in its forests, and despite the fact the industry of wood generates a significant 8% of total local exports, the Croatian economy is not focused on this sector, according to wood producers. After a positive 2011 and export of US$964 million, which was almost on the level of the pre-crisis 2007, data on exports and production of the wood industry show a 5.1% fall for the first eight months of this year compared with the same period of 2011. According to state institutions the wood industry is still under a negative influence of the crisis

D

due to exports, but mainly due to the construction sector and spending power of the local market. The crisis was confirmed by Ambienta, the international show of furniture, interior design and accompanying industry on which some of the most successful producers of this sector did not par-

To continue the expansion it is important to have high-quality products of attractive designs and as higher productivity as possible ticipate for the first time ever. Not a single parquet producer participated at Ambienta, which

is the leading export product of this branch. Big companies like Tvina, Spačva and Finvest also lacked out. We are exporting stripped forests During the first eight months of 2011 the wood sector, which also includes furniture producers, exported $634 million worth of goods, and this year’s export reached $601 million between January and August. Imports decreased by 9.8% during the same period, from US$396 million to 357 million. The largest share of this year’s export, $379 million, concerns wood and wood products, while the furniture sector achieved exports of US$22 million. Surplus in total exchange of goods is high

($223 million or 168%), however, export of local furniture producers exceeded import only by $1 million. During the first eight months over 1.35 million tonnes of lowprocessed wood (fire, unprocessed or trunks cut into boards) was exported from Croatia. The wood producers say these numbers are hiding high-quality raw material searching for a shortcut to the foreign buyer. During the last four years, the wood sector received a subsidy of non-refundable and purpose HRK290 million. However, this sector points out they are still lacking strategic approach to the branch and that these are only individual initiatives and mainly independent search for buyers on the foreign markets.


www.privredni.hr Business & Finance Monthly

13

( HRK59.5 million ( 1369 companies of subsidies this year

active in this sector

sion after a good year PPS Galeković: Loan free into eastern markets PPS Galeković developed from a small workshop for manufacturing furniture into one of the leading parquet producers in the region. Parquets and floors are their main products, manufactured by around 200 workers in two production floors in Mraclin near Velika Gorica and Majur near Hrvatska Kostajnica. They are known in the world, and their employment rate as well as sales did not reduce during the crisis years. They anticipate a 5% growth this year, announces Marketing Director Filip Galeković. Europe is in a crisis, which is why we turned to the eastern markets. We opened the Russian market, Azerbaijan and Turkey, and we are also planning to open the markets in Kazakhstan and Uzbekistan. We will focus on exports of high-quality products which increases added value, says Galeković. They also intend to venture into new markets during the forthcoming period. They are negotiating the placement of parquets and floors in the Baltic States, New Zealand, the USA and even Japan. The company annually produces over 750 square metres of floors and parquets, and processes over 40,000 cubic metres of trunks. The majority of the production (around 65%) is exported. It is also interesting that unlike the majority of Croatian companies, PPS Galeković is not burdened with loans. They developed using personal funds exclusively. Contract on subsidies were signed for this year also, however, HRK59.5 million went to almost 160 companies from a total of 194, which means the subsidies will not be high in individual cases.

At the end of this year 1369 companies operated in this sector and employed 20,879 workers. Total revenue of this sector’s companies was HRK7.2 billion, which is 9% more than the year before. However, it is still below the HRK7.5 billion from 2008.

Low competitiveness prevents this sector’s export to increase

Venturing into new markets To continue the expansion to the European and other foreign markets, it is important to have highquality products of attractive designs and as higher productivity as possible. Long-term contracts with Hrvatske šume (Croatia Forests) on the supply of raw material, that should be signed soon, should improve productivity and production planning. According to the announcement of the Ministry of Agriculture, elements such as realised income and export, as well as the number of the employed will be taken into account when allocating quotas. This sector’s perspective should be improved by structural

Low competitiveness prevents this sector’s export to increase. Exporters add a better exchange rate policy could help, as well as creating an export brand of the wood industry, and of course, reducing entry prices (from raw material to energy-generating products). Although the majority of the companies in this sector operate on the foreign markets, they are still characterised by low productivity, low finalisation level, and some are still troubled by poor management.

EU funds for which projects should be well prepared in order to draw as much as funds as possible. The markets of the Russian Federation, Kazakhstan and the Arabian Peninsula are very attractive

and have huge potential as well as other financial highly capable national markets, like the American one. Some companies have already started to approach new markets, and together they could achieve good results.

Kavran: No strategy for wood industry Despite the intensive influence the crisis has had on wood processing in Croatia, this sector still represents one of the most competitive part of the Croatian economy, especially since its export orientation generates 8% of total Croatian export, and since it is the biggest net exporter. Policies of the wood sector do not exist. Actually, ideas are shared only at opening ceremonies or assemblies, or when a problem emerges. They are not bad in general, and they sound optimistic, but they lack strategic elements and ideas on what should be done with our raw material and how to preserve and improve the sector which represent a third of the entire processing industry. To many it sounds good that Croatia is still the fourth world producer of massive parquets, and that our companies still export wood products on the most demanding global markets. The media published the news with great enthusiasm when the windows from Gorski kotar were fitted in a hotel in Seoul, and that the parquets made from the Slavonian oak still manage to find customers in Moscow and Dubai. Unfortunately, this is not the result of politics, but rather of the desire of individual companies to survive and penetrate new and propulsive markets since the old ones lack room for growth.


14

Privredni vjesnik Year V No 220

( 60,000 units ( HRK190 million annual production of Plamen

expected turnover in 2012

Plamen Cookers, Stoves and Fireplaces Factory

A huge success in Požega valley Creation of new jobs, three-shift work, exports of 80% of production, increasing salaries, the 13th salary, lunch for HRK4, investment in new technology, to name a few, can be achieved in Croatia Svetozar Sarkanjac he Požega-based company Plamen is a successful Croatian company and hence it certainly needs to be brought to public attention within the crisis. It has been operating for nearly a hundred years and has been particularly successful during the last several years. This metal processing company managed to increase the salaries by 11% during the first nine months in 2012 and it is also planning the 13th salary for its employees at the end of the year. Moreover, it invests around HRK100 million in new technology, exporting 80% of its production and is currently still creating new jobs. “We employed 25 new staff in September this year and hence Plamen currently employs 433 staff. We have recently introduced working Saturdays in addition to three-shift work, due to increasing demand for exports and excellent business results”, stated Vinko Matijević, Board Member of Plamen.

T

Decreasing demand for old-fashioned cookers Plamen is one of the largest Croatian foundries, as well as the largest and the sole manufacturer of household heating appliances in Croatia. In 2011 its turnover stood at HRK185 million, whilst this year the turnover is expected to exceed HRK190 million. The factory produces 60,000 units per year, using innovative technologies, as well as its longterm experience and high skills. The product range comprises of

cookers, fireplaces and solid fuel stoves, as well as gas and universal boilers for central heating in commercial and residential buildings and factories. Old-fashioned solid fuel cookers, which can still occasionally be seen in some grandma’s kitchen, are slowly disappearing from the market and, as the demand for them has been dropping considerably, they are being replaced by simple electric or gas models. According to Matijević, the demand for stoves and fireplaces has seen a significant increase over the last several years. Oldfashioned cookers, which used to account for 70% and 80% of production, have currently plunged to 20%. New investment The factory keeps abreast with the current market trends and has hence managed to establish its position on several European markets. In addition to various models of stoves and fireplaces, the company also produces a

wide range of cast iron products used in its own production, as well as EN-GJL 200 to satisfy purchase orders, and its annual production stands at around 12,000 tonnes. Moreover, Plamen is specialised in production of squeeze casting used in production of cookers, stoves, boilers and fireplaces. Over 80% of the current production of Plamen is exported, primarily on West

European and North European markets, whilst 55% of revenue is generated in Italian market. In addition to constant investment in product design, Plamen invests also in technology. Consequently, its current value of investment in new electric stoves exceeds HRK100 million, which will imply energy savings and increase production capacity by 30% to 40%.

European market – a role model If business conditions in Croatia were on par with those in similar companies in advanced European economies, we would be considerably more competitive. According to estimates, we would be able to increase the employment rate from 50% to 60%, explained Matijević, pointing out the fact that industrial gas prices in Croatia are the highest in Europe. On one hand we purchase raw materials and machinery on world stock markets, whilst on the other hand we have domestic energy monopoly. “We purchase metal on world stock markets, whilst simultaneously we rely exclusively on HEP as our local energy provider and its gas whose prices are 20% or 30% higher for Croatian industry than for household consumption and hence we are co-financing the general public who opt for gas heating. We consume around 1,200,000 cubic metres of gas per year, which is a huge expense and we still need to implement numerous changes to keep abreast with the Western World“, stated Matijević.


www.privredni.hr Business & Finance Monthly

15

( 19.5%

unemployment rate in October

CROATIAN EMPLOYMENT SERVICE

333,400 registered unemployed persons in October The number of unemployed persons in October 2012 was 13.5% up in relation to October 2011, indicating the highest unemployment rate during the last 27 months or since July 2010. he number of unemployed persons continued to rise in October, with unemployment rate rising faster compared with the previous months. 333,400 unemployed persons were registered in Croatia in October, according to the data provided by the Croatian Employment Service, which indicates 22,300 more people unemployed or 7.2% up over September. 45,257 unemployed persons were registered in October, which is 12,566 more people unemployed in relation to September, whilst 22,957 persons exited the register, which is 217 less compared with September. Unemployment inflow is due in part to seasonal unemployment,

T

as most newly unemployed were registered from the sectors of accommodation, food preparation and catering, as well as from both the retail and the wholesale sector. Negative trends rising Negative yearly trends continue at a significantly faster rate. The number of unemployed in October 2012 stood at 13.5% and there were 39,548 more people unemployed in relation to October 2011, which was the highest unemployment rate during the last 27 months or since July 2010. Unemployment rates by education level are the highest amongst holders of the highest education level. Unemployment rates

amongst Bachelor’s degree holders, professional studies degree holders and polytechnic institute degree holders soared by 32.1%, whilst unemployment rates amongst holders of Master’s degree, academic degree holders or Ph.D holders rose by 28.3%. According to RBA analysts’ es-

timates, unemployment rates in October will stand at 19.5%, with unemployment growing until the end of the year and throughout the first months of 2013. Unemployment will remain considerably high, against the backdrop of low economic growth prospects throughout 2013. (V.A.)

LOAN PROGRAMME FOR THE DEVELOPMENT OF THE ECONOMY

THE WORLD BANK

HBOR granted €50 million by the World Bank

Harrold: Improvement of EU funds absorption imperative

Croatian Bank for Reconstruction and Development (HBOR) has recently been granted a new €50 million loan by the World Bank. HBOR corporate banks will use these funds to grant loans to exporting and tourism companies at favourable interest rates. “We obtained our first €100 million loan for exporting companies from the World Bank in 2009. Exporting companies, which account for one-fifth of total Croatian exports, were granted the loan and consequently increased their exports by 30%. They managed to retain their employees irrespective of the crisis and even created several new jobs”, stated Anton Kovačev, Board President of HBOR. Around 60 export-

Croatia needs to preserve her financial stability, continue with structural reforms, attract foreign investment and substantially benefit from her EU accession, as stated by Peter Harrold, Regional Director of the World Bank for Central Europe and Baltic Countries. He also added that he was optimistic concerning the Croatian economic recovery, primarily in case she manages to effectively use over €10 billion available from the EU funds during the forthcoming seven years. He indirectly advised Zoran Milanović, Croatian Prime Minister, to assist Branko Grčić, Minister of Regional

ing and tourism companies have used these loans for medium and long-term financing thus far, at a 4.8% average interest rate. The new credit line will extend payment terms to 15 and 20 years. “The World Bank is altering its activity in Croatia with these loan programmes. We are increasingly approving loans for the private sector. We believe we will substantially increase the financing for exporting companies”, announced Hongjoo Hahm, World Bank Country Manager to Croatia. (I.V.)

Development and EU Funds, in bringing together the best experts to attract EU funding and hence provide funding for public investment. If Croatia manages to absorb EU funding effectively, she does not need to be excessively concerned over the possible prolonging of the European sovereign debt crisis. (J.F.)


16

Privredni vjesnik Year V No 220

( HRK284.2 billion of total loans at the end of September mber

Croatian National Bank

Total loans continue to fall Decreasing loan activities of all sectors reduced the loans on a monthly level he banks’ loan activities in September continued to slow down for the second month in a row. According to the latest data provided by the Croatian National Bank, the loans of the banking system totalled HRK284.2 billion at the end of September, which is HRK2.9 billion or 1% less in relation to August. The decreasing loan activities of all sectors reduced the loans on a monthly level. Corporate loans reduced by HRK1.5 billion (1.3%) to HRK109.9 billion. Public loans reduced by HRK813 million to HRK126.2 billion, while state loans decreased by HRK441 million to HRK45.5 billion in September. This year’s fall in loan activities is confirmed by the data in Sep-

T

tember compared with the situation at the end of 2011. During that period total loans reduced by HRK5.2 billion or 1.8%. Loan activities on hold These activities are the result of the considerably intense downfall of corporate loans (-HRK8.9

Financial Agency

billion) and public loans (-HRK2.5 billion), while state loans grew by HRK6.3 billion. Actually, in accordance with the decision on the shipyards’ rehabilitation, the Ministry of Finances took over a share of the shipyards’ loans on the basis of which corporate loans registered

a fall, while state loans registered an increase. By the end of the year, RBA analysts do not anticipate the banks’ loan activities to intensify. The demand for corporate loans is limited by the strict business conditions and decreased demand. Slightly more intense loan activities could arrive through HBOR’s loan programmes, but it should be pointed out it is very difficult to find quality projects for funding. A considerably high public debt and unfavourable movements on the labour market prevent this sector’s recovery. This high level of uncertainty is confirmed by the fact housing loans have been registering annual fall rates (HRK58.8 billion) for the third month in a row.

Croatian National Bank

Decreased gross profit of Bad loans entrepreneurs grew to 14%

During the first nine months of this year Croatian entrepreneurs earned gross profit of HRK25.1 billion, which is 5.6% less compared with 2011, according to data provided by Fina. The entrepreneurs earned a profit total of HRK458.9 billion, while expenditure totalled HRK433.8 billion. Total revenue increased by 0.7%, while expenditure grew at a rate of 1.1%. According to Fina’s data, over a half of total number of entrepreneurs (50,791 or 54.9%) operated

with gross profit during the first nine months of this year, while 41,701 of them or 45.1% realised gross loss. These data were collected from the financial reports of 92,492 companies. The reports show these companies realised revenue of HRK105.79 at an expenditure of HRK100. On the basis of working hours, Fina’s experts calculated these companies increased employment by 1.5%. The salary of the entrepreneurs who pay profit tax stood at HRK4,703.00, which is 3% less compared with the same period of 2011 due to higher consumption prices. During the first nine months of this year, the Croatian entrepreneurs invested in fixed assets HRK27.2 billion or 2.4% more compared with the same period of 2011. (I.V.)

The share of potentially noncollectable loans grew to 14% in September, according to data published by the Croatian National Bank. Out of HRK287.2 million of total banking loans in Croatia, HRK40.3 billion fall into the category of partially recoverable or completely irrecoverable loans. In relation to the end of the last year, bad loans grew by 1.62% in the share of total loans from 12.43%. The share of bad public loans stands at 9.35%, but companies are still the ones facing bigger problems in terms of loan servicing. The share of potentially uncollectable corporate loans in total loans is 24.44%. This is 4.31% more in relation to the end of the last year. At the end of this year’s September, there was a questionable collection of HRK27.9 billion out of

HRK114.3 billion worth of corporate loans issued to this sector. Total public loans stood at HRK125.7 billion at the end of September, out of which roughly HRK11.7 billion worth of loans were classified as bad loans. The majority of the public’s debt refers to housing loans, and at the end of September these loans totalled HRK58.8 billion, of which the collection of 5.87% (HRK3.4 billion) was questionable. The problem of collection was additionally worsened by loans in Swiss franks. Their share of bad loans equals 13.18%, where the largest share of bad loans in Swiss franks refers to companies (50.16%). Corporate loans in Swiss franks total HRK2.6 billion, with risky collection referring to half of that amount. (I.V.)


PV International 0220