March 31 - The Supervisory Board of Podravka has accepted, at the meeting held today, the Business Results Report of the Podravka Group for the full year 2007.
• The growth of sales of all Podravka's brands – the growth of 8% compared to the year 2006.
• The process of restructuring continues that has begun in 2005 –in 2007 in the process of restructuring invested 50. 3 mn HRK
• The total value of investments and acquistions amounted to 291.4 mn HRK.
• The brands Warzywko and Lero were successfully integrated into the Podravka brand product portfolio.
• The start of production in the new Factory of baby food.
The Supervisory Board of the Podravka Group supports the contiuation of the process of restructuring the company which has begun in 2005 and particularly with regard to the positive steps forward in the first quarter of this year which are partly the result of the investments put in the restructuring processes. We expect the defined plan to be achieved and an increase of the business efficiency of the Podravka Group “ – Mladen Vedriš has said, the President of the Podravka Supervisory Board.
In the year 2007 the Podravka Group has achieved the total profit in the amount of od 3.521.6 mn HRK of which the trade revenues amounted to 3.431.8 mn HRK.
The total net profit of the Podravka Group for the year 2007, including the restructuring costs amounts to 18.3 mn HRK.
The trade revenues of Stragegic business Area (SBA) Food and Beverages amounted to 2.810.6 mn HRK which makes the 82% of the total trade revenues of the Podravka Group for the year 2007 The realized level of sales of SBA Food and Beverages was influenced by the drop of sales of the commercial goods (Nestlé) on the foreign markets which was almost completely compensated by a vigorous growth in revenues by sales of Podravka brands. Thus, on domestic market a growth in revenues by sales of Podravka brands was registered in the amount of 5% while on the foreign markets the achieved sales growth in the amount of 7% was registered.
All product groups within the Podravka brands achieved sales growth compared to the same period last year, resulting in a total growth of Podravka brands of 8%. The biggest growth was achieved in the Group of products Beverages (23 %) whereas the most significant Podravka's Food seasonings group products achieved the sales growth in the amoung of 4%. The Meat products and canned fish group products group achieved the sales growth of 14%, the products group Baby food, sweets and snacks achieved the 7% and Podravka Dishes 5 %.
The SBA Pharmaceuticals achieved sales in the amount of 614.3 mn HRK. Sales of OTC products achieved growth on the Croatian market in the amount of 24% while the sales of prescribed drugs whose value of sales is subject to changes (decrease) in the price of drugs on the Croatian Health Insurance Institute list decreased by 4%. On the foreign markets the sales achieved a growth in the amount of 10% of which the sales of prescribed drugs achieved growth of 8%, and the OTC products in the amount of 48 % The highest sales growth was achieved on the Russian market. (36%).
When discussing the markets of the Podravka Group, on Croatian market the sales growth of 3% was achieved whereas on the foreign markets the highest sales growth was recorded on the market of East Europe (11%) and on the market of Central Europe (6 %).
The operating expenses of the Podravka Group increased by 1% compared to the year 2006 and their structural change results from the modernization of business processes and the Group’s business restructuring. The reduction of Costs of goods sold of 5% results from the purchasing centralization process, continuous product portfolio optimization. The continuance of the restructuring process increased General and administrative expenses (11%) and severance payment expenses which were 40% higher than in 2006 greatly influenced this growth.
Of the last year's activities we can point out the purchase of the Polish brands Warzywko and Perfecta in order to strengthen our leading position in the category of universal Food seasonings and the purchase of the Lero on the Croatian market which has also strenghtened our position in the category of non alchoholic beverages. Besides that a business cooperation agreement was concluded between Podravka and the company Microsoft solving the issue of licensing Microsoft platform products for all Podravka Group companies located in eighteen countries worldwide.
In the year 2007 the Podravka Group has been given numerous recognitions of which we should point out the Business Reputation Award in Croatia which was given by the Reputation Institute of the USA. Once again, Vegeta has been declared to be the best product in its category on the Polish market according to the independent consumers' poll.