Agrokor’s retail business, Konzum, reported revenues of HRK4,739m (€639m) for the first half of 2018. This included the company's Croatia and Bosnia-Herzegovina (BiH) operations. The retailer is on course to recover in 2018. We forecast Konzum sales will grow by 1% to HRK9,300m (€1,253m) for the year. This is an improvement on its performance in 2017.
Konzum on course to recovery in 2018…
Konzum’s retail operations reported a decline of 16% in sales to HRK9,200m (€1,240m) in 2017. The year saw it go into administration for debt repayment. Its half year performance in 2018 shows it is likely to return to revenue growth. If it reports growth this will be the first time in four years.
...and it meets planned revenue
Konzum hit its revenue target of HRK4,739m (€639m) despite its BiH operation falling behind the target by 5.1%.
Konzum Croatia’s positive result offset by BiH
Konzum Croatia reported sales growth of 3.1% in 2018. This is above the planned revenue, driven by higher than anticipated traffic at its stores. Also, an increased number of promotional activities drove up the average basket size. But Konzum’s performance in Croatia was offset by Konzum BiH. It reported a like-for-like sales decline of 0.6%. This was due to a decline in footfall by 1.5%, although average basket increased by 1%.
Profitability builds financial clout for future store expansion
Konzum improved its profitability by optimising stores and closing unprofitable ones in 2017. Although much of the profit went to debt repayment. The increased profit will build its financial clout for future store expansion.
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