In H1 2022, Fortenova Group generated HRK 18.8 billion of total revenue from continuing operations, up 57% on the year, operating profit exceeded HRK 1 billion and net profit was HRK 12 million.

The 57% increase was mainly driven by the integration of Mercator, while on a like-for-like basis revenue grew by 14%, the Group said on Friday.

The Group’s consolidated EBITDA for H1 2022 exceeded HRK 1 billion, 74% more than in the same period last year, while on a like-for-like basis the adjusted consolidated EBITDA grew by 19%.

The fastest growth of revenue was recorded by the companies from the Group’s Food Division, while the Agriculture Division saw the fastest growth of EBITDA.

Net profits of the period, after exclusion of currency exchange impacts, amounted to HRK 12 million, as against the loss of HRK 213 million after exclusion of currency exchange impacts in H1 2021.

At the end of H1 2022, Fortenova Group had HRK 1.7 billion in its accounts. Continuing its already long-term deleveraging trend, it closed H1 with a debt to operating profit ratio moving 3,94 times.

The “excellent operating results were generated in spite of the negative impacts of inflation on the increase in prices of labour, energy and raw materials and the consequently increased costs across the supply chain,” said the Group’s CEO Fabris Perusko.

This year’s tourist season “is almost at the level of the record year 2019, which is an additional driver for our results that will show its full benefit in the third quarter of the year, which is the most important time period for us, he added.

The expected changeover to the euro “will have an additional long-term positive impact on the Group’s credit profile, as after the conversion 80% of our business will be generated in euros. Additionally, the currency risk for our debt will be eliminated,” Perusko said.

He added that ownership transformation and divestment of shares held in Fortenova Group by Russia’s Sberbank continues and that in H1 2022, the final prerequisites for a court ruling on closing the Extraordinary Administration Procedure in Agrokor will have been met.

James Pearson, Fortenova Group’s CFO, said the Group had a very positive first half of the year, having focused on market realisation and achieving the planned operational improvements.

“Following the significant deleveraging achieved by Fortenova Group in 2021 by the transactions related to Mercator, the Frozen Food Business Group and a number of non-core business and property disposals, in 2022 we have continued to generate higher revenues and operating profits, which brought about a further decrease in the leverage ratio, which now amounts to 3.94 times which reflects the increasing financial strength of the Group,” he said.

(€1 = HRK 7.5)