The following statement was released by Adris grupa on its website:
Reflecting on the circumstances in which the Company operated, the management underlined that the COVID-19 pandemic that started in early 2020 resulted in a global economic crisis. Supply chains were interrupted, cross-border travel was reduced or completely stopped, and the uncertainty caused economic optimism to decline as well. Capital investments were reduced or stopped as a result. The world faced the greatest global economic crisis since World War II. In addition to the economic crisis, Croatia was hit by two devastating earthquakes in 2020. The first hit the Zagreb area in March, and the second hit the Sisak-Moslavina County in late December, with its epicenter near Petrinja.
In such circumstances, as the Company management reported, Adris grupa, according to audited consolidated reports for 2020, posted total revenue of HRK 4.7 billion, down 18% year-on-year. Revenue from the sales of goods and services amounted to HRK 4.3 billion, down 20% year-on-year. Consolidated EBITDA (profit before interest, taxes and amortization) stood at HRK 586 million, and net profit at HRK 45 million. Having invested almost HRK 500 million in 2020, the Group maintained the financial potential required for a new investment and development cycle.
The Group's tourism business in Istria showed resilience in economic crisis conditions
The past year was the worst in history: tourist arrivals were down 74% on global level. According to the World Tourism Organization's (UNWTO) report, Europe experienced a 71% drop in tourist arrivals. The loss of tourism export revenue is estimated at USD 1300 billion and is more than 11 times higher than in the global economic crisis of 2009. According to the UNWTO's data, the pandemic threatened between 100 and 120 million jobs in tourism. With a 63% drop in tourist arrivals and a 50% drop in overnights (approximate figures), Croatia boasts the best result in the Mediterranean. The decline in the commercial segment is 55%.
A number of business process optimization and cost rationalization measures were launched in the Group's tourism business in response to the crisis. We maintained the continuity of our product improvement efforts and invested HRK 207 million even in this challenging year, mostly in improving the quality of the extra amenities at the Koversada/Porto Sole and Amarin camps. The preparations for planned projects and investments for the period after 2020 continued. Maistra, including the Hilton Imperial in Dubrovnik, sold 679,000 units in 2020, 45% of last year's result in the same period. Revenue from the sales of goods and services was at 41% of last year's result in the same period. A segment-by-segment analysis shows that the camps' results in terms of the number of units sold in 2020 were nine percentage points higher than Maistra's average. Between June and September, when our business was mostly unencumbered by restrictions introduced due to epidemiological measures, the luxury hotel segment in Rovinj had the best sales results compared to last year, with its results higher than Maistra's average by seven percentage points. Results are shown in form of the performance index in relation to last year. In 2020, HUP-Zagreb sold 18% of units sold in 2019 and generated 18% of the sales revenue from 2019. The consolidated sales revenue in the tourism segment in 2020 amounted to HRK 596 million, 35% of last year's result. EBITDA (profit before interest, taxes and amortization) amounted to HRK 90 million, and net loss to HRK 136 million. The Group's positive EBITDA indicates that the tourism segment maintained a level of operating profit and liquidity sufficient to support its regular operations in the crisis year of 2020.
Croatia osiguranje strengthens the position of Croatian market leader
Croatia osiguranje strengthened its position as the market leader in 2020. After years of decline, it reversed the trend for the first time, increasing its market share. Croatia osiguranje is the convincing Croatian market leader, with a market share of 26.7%, or 0.5 percentage points more than in 2019. Total gross written premium amounted to HRK 2.674 million. Gross written premium at CO Group level amounted to HRK 3.238 million, down 2% year-on-year. The combined ratio from the Group's regular business activities, one of the key indicators of operating efficiency, stood at 94.8 and improved by 0.8 percentage points year-on-year, an indication of further improvement of the cost effectiveness of CO's business.
A number of one-off items burdened the business of Croatia osiguranje in 2020, the largest being the costs of the earthquakes in March and December, and the decision of the Croatian Supreme Court to increase the orientation criteria and amounts for non-pecuniary losses. Income from dividends and recovery of claims also decreased amidst the COVID-19 crisis. The net effect of the above events and activities took more than HRK 100 million off the company's result before taxes. The Company largely compensated for this negative effect with operating excellence and positive effects of the Company's transformation programs, and CO Group posted a net profit amounting to HRK 328 million in 2020.
As the regional and digital leader, at the moment Croatia osiguranje invests more than HRK 200 million in digitalization and new product development. A number of successful projects were launched, including remote damage reports, the new Moja Croatia app and the Company's new website, and the launch of a completely new product, Laqo osiguranje - the first Croatian 100% digital insurance. The Company also developed and launched the specialist post-graduate course Products, Digital Innovation and Technologies in Insurance (Insurtech) in cooperation with the Faculty of Electrical Engineering and Computing in Zagreb. The trend of strengthening the internal network and expanding the external sales network continued, and a new call centre was opened in Vukovar.
With 9% volume growth, Cromaris sold more than 10,000 tonnes of whole fish equivalent
The COVID-19 crisis caused a number of logistics challenges in fresh fish and fish product distribution at the end of Q1 2020 and in Q2 2020. The shutdown of catering establishments in its key markets drove the Company to shift its focus to retail chains, which required it to quickly adapt its sales portfolio, as well as the organization of its production and distribution.
In 2020, Cromaris sold 10,376 tonnes of whole fish equivalent, up 9% year-on-year. Export volumes were up 17%. Export markets account for 84% of Cromaris' sales volumes, and 86% of its sales revenue. Revenue from differentiated products, mainly fresh gutted and packaged fish - sea bream, sea bass and meagre fillets - was up 16%. At the moment, differentiated products account for 48% of the company's sales revenue, in line with Cromaris' strategy of standing out from the competition. Average prices increased 2%. Sales revenue in 2020 amounted to HRK 512 million and was up 8% year-on-year. Cromaris posted a net profit of HRK 9.2 million in 2020.
The Company will publish its annual report on its website, as well as on the websites of the Zagreb Stock Exchange and the Croatian Financial Services Supervisory Agency (HANFA).
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