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,
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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-
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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.)