Croatia-based food-to-retail group Agrokor ended 2014 with a 16% annual growth of revenues to HRK 35.3 billion (€4.63 billion), mainly due to the takeover of Slovenian retailer Mercator.
The bulk of revenue was generated through wholesale and retail, amounting to just over HRK 29 billion (€3.8 billion). Most of it, or HRK 21.2 billion, was achieved on the home market, while the rest came from the Adria region (Slovenia, Bosnia and Herzegovina, Serbia and Montenegro).
According to the financials, published by Croatia’s TPortal, Agrokor still registered a net loss of HRK 225.5 million (€29.6 million) in the same period, compared to a profit of HRK 35 million a year earlier.
Besides the financial implications of the acquisition of a 80.75% stake in Mercator (worth over €500 million), Agrokor’s results were also marked by poor weather conditions and a decline in GDP in the three major markets (Croatia, Serbia and Bosnia and Herzegovina). All this resulted in a decline in revenue and lower profit margins of most of Agrokor's companies and ultimately the negative financial result of the Group as a whole.
However, at Agrokor they point out that the real effects of the merger between Mercator and Agrokor’s retail unit Konzum will arrive only this year, contributing to significant growth in profitability and efficiency.
According to Zdravko Marić, executive director for strategy and capital markets at Agrokor, the new synergy potentials from the Mercator acquisition are available in procurement, marketing and distribution, considering the fact that both the Croatian and Slovenian companies were doing business on three same markets. The acquisition also opened new opportunities for all suppliers working with Mercator and Konzum because they gained presence in more stores.
Agrokor operates the retail formats Konzum, Idea, Mercator and Roda in the Adria region.
© 2015 European Supermarket Magazine – your source for the latest retail news. Article by Branislav Pekic. To subscribe to ESM: The European Supermarket Magazine, click here.
