The business results of the Podravka Group for January - September 2003

The Supervisory Board of Podravka d.d. has approved the business results of the Podravka Group for the first nine months of 2003.

In the third quarter of 2003, the Podravka Group’s trade took a positive upward turn, achieving good sales results, with costs rising more slowly than sales. In this quarter alone, the Podravka Group achieved two thirds of the total EBIT of the first nine months of the year.

The revenue realised by the Podravka Group in the period from January to September 2003 amounts to HRK 2,492.4 million, which is 23% more than in the same period of 2002. In this period, the Podravka Group generated net profit to the amount of HRK 24 million, which is HRK 53 million more than in the first six months of the year.

In the structure of total revenues, sales revenues amounted to HRK 2,388 million, representing an increase of 25% compared with the same period last year. Revenues from sales of the Podravka Group for the first nine months of the year amounted to 67% of planned revenues. In this increase of sales revenues, 10% is accounted for by Nestle products, 10% by the products of acquired companies, 2% by other traded goods, while organic growth amounted to 3%.

In the first nine months of 2003, the Podravka Group realised sales revenues of HRK 2,388 million, which is 25% up on the same period last year. Of this, 55.5% was achieved in the domestic market, and 44.5% came from sales in foreign markets. There was a 20% increase in sales in the Croatian market, and a 32% increase in foreign markets.

In the structure of sales revenues for the first nine months of 2003, Vegeta accounted for HRK 420.7 million, which is less than in the same period last year, a drop caused by poorer sales results in the markets of Poland and the Baltic countries. Podravka foods generated sales revenues in the amount of HRK 201.9 million, which marks an increase of 2% compared with the same period of last year. Lino, Dolcela and Kviki generated sales revenues in the amount of HRK 199.3 million, representing a 4% increase compared with the same period in 2002. The sales revenues for meat and meat products amounted to HRK 202.8 million, representing a 12% increase compared with the same period of 2002. Fruit and vegetables recorded sales revenues in the amount of HRK 157.1 million, which is 9% up on the same period of last year, while beverages generated sales revenues of HRK 164.5 million, representing the biggest increase of 46%.

Pharmaceuticals and cosmetics recorded sales revenues in the amount of HRK 434.5 million, representing a 7% increase compared with the same period of 2002. Traded goods generated sales revenues of HRK 335 million, primarily thanks to the distribution of the products of the Nestlé Company, marking a significant increase in sales.

The sales revenues in the markets of South-Eastern Europe in the first nine months of this year amounted to HRK 489.6 million, showing a 46% increase compared with the same period of last year. The Central European and German markets generated sales revenues of HRK 310.7 million, and a 92.3% increase in sales due to acquisitions in the Czech Republic and Slovakia, which also increased their share in the total sales of the Podravka Group by 8.4%. The Polish and Baltic markets stabilised, achieving sales revenue in the amount of HRK 82.8 million, while the monthly sales doubled in comparison with the beginning of 2003, and sales for the third quarter increased by 37% compared with the third quarter of last year. The sales revenue generated in the US, Canadian, Western European and Scandinavian markets amounted to HRK 65.7 million, marking an 18.4% increase compared with the same period last year. Sales revenue in the Eastern European markets amounted to HRK 64.5 million, 15.2 % up in comparison with the same period in 2002.

In July 2003 EBRD sold back its stake in Podravka and consequently left the ownership structure of the Group. During the first nine months of this year, Podravka obtained a concession for the 3rd channel of the national television network by participating in the RTL-led Consortium, which also includes Pinta TV, Agrokor, Atlantic Group, Splitska Banka – HVB. Podravka was also involved in the takeover of the former largest trading company in Croatia, Diona d.d., through Dinova, which, apart from Podravka, also includes the Croatian food companies Gavrilović, Lura, Kraš and Vindija. The construction of the new factory for Podravka foods has been completed, resulting in an investment with a total value of HRK 123 million.