Earnings Report /
Croatia

Adris: Solid growth with more potential despite higher expenses

  • In 9M 2022, Adris’ sales amounted to HRK 4.93bn, an increase of 18% YoY.

  • Tourism segment: Adris sold 1.75m units in 9M 2022, an increase of 30% YoY, and 98% of 2019’s level.

  • Insurance segment: The Croatian insurance market increased by 7% in 9M 2022.

Tea Pevec
Tea Pevec

Head of Research

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InterCapital
10 November 2022
Published byInterCapital

In 9M 2022, Adris’ sales amounted to HRK 4.93bn, an increase of 18% YoY. Growth was recorded across all business segments. CO recorded a 7% GWP increase to HRK 2.42bn. Tourism revenue grew by 46% YoY, amounting to HRK 1.75bn. Food segment growth amounted to 28% YoY. Q3 2022 contributed the majority of this growth, especially in the tourism segment. In total, 9M 2022 net profit amounted to HRK 705m, an increase of 17% YoY.

Tourism segment: Adris sold 1.75m units in 9M 2022, an increase of 30% YoY, and 98% of 2019’s level. Revenue amounted to HRK 1.75m, an increase of 42% YoY, and 12% compared to 2019. Sales in Istria were 5% higher than in 2019, while Zagreb hotels were at 68% of 2019’s level. The luxury segment in Istria achieved a 15% higher number of units sold than in 2019. EBITDA amounted to HRK 700m, up 16% YoY and 1% compared to 2019. The net profit of the segment amounted to HRK 463m, up 29% YoY and 96% of 2019’s level. The planned investments for the year should amount to HRK 470m, of which the majority will go to the Panorama hotel in Zagreb, while HRK 200m will be used for Maistra’s camps.

Insurance segment: The Croatian insurance market increased by 7% in 9M 2022, while Croatia osiguranje recorded a GWP growth of 7% YoY, amounting to HRK 2.42bn. The total market share of CO amounts to 26.9%, while in Non-life it amounts to 31.9%, an increase of 1.2 p.p. YoY. Consolidated GWPs (including subsidiaries) amounted to HRK 2.97bn. The growth was driven by the increase in Non-life GWPs (+15%) while Life GWPs declined by 25%. The combined ratio amounts to 93.9% (+1 p.p.). Net profit amounts to HRK 322m, an increase of 1%. CO continues investments, with total planned investments of HRK 160m.

Food segment: In 9M 2022, Cromaris sold 10.9k tonnes of fish, an increase of 18% YoY. The export market recorded 21% in volumes sold. Cromaris has 87% of both sales revenue and volume in these markets. Prices also increased, by 8%. Revenue amounted to HRK 579m (+28%), EBITDA amounted to HRK 65m, +25% YoY, and finally, a net profit of HRK 16m, an increase of 25%.

Adris continues to record solid top-line growth across all segments, with Q3 2022 contributing significantly, especially in tourism. Even so, the macroeconomic situation is putting a strain on the Group’s margins. Despite this, Adris recorded another solid quarter. Combined with a decent DY and a share buyback program, they continue to give value to their investors. Adris operates in various industries, and they are proving to be more resilient to shocks, and as such are well positioned to continue executing their investments, business strategy, and growth trajectory.