Today, we bring you an overview of the indebtedness and capital structure of the Croatian blue-chip companies included in the CROBEX10 index, based on the latest 9M 2025 financials.
With all 9M 2025 results now published, we assessed how recent performance trends have affected the leverage profiles of Croatia’s largest public companies. The analysis focuses on three core metrics: Net debt / EBITDA (using trailing 12-month EBITDA), the additional debt capacity available before reaching 3x EBITDA, and the capital structure.
A net leverage level of 3x EBITDA is widely viewed as the upper threshold of sustainable indebtedness, because above that refinancing risk, interest burden, and financial flexibility typically deteriorate. Of course, this boundary varies by sector, but it remains a relevant benchmark when evaluating companies’ ability to fund new investments, particularly M&A transactions which often require incremental leverage as will be shown later in the text.
Although banks and loan covenants commonly exclude lease liabilities when defining indebtedness, this analysis applies a consistent IFRS-based approach, treating lease obligations as financial liabilities. As a result, total interest-bearing debt comprises bank borrowings, bond issuances and lease liabilities, while the cash position includes cash, cash equivalents, and liquid short-term financial assets such as deposits and short-term fixed-income instruments. It is also duly noted that HPB is excluded from the analysis given that banks do not report EBITDA and apply different leverage and capital structure metrics.
Most Croatian blue chips currently operate in a net cash position, including ING-GRAD, Končar D&ST, Ericsson Nikola Tesla, Končar Group, and Hrvatski Telekom. Negative net debt indicates that cash and liquid assets exceed total financial liabilities, resulting consequently in negative net debt / EBITDA ratios.
Net debt to EBITDA of select Croatian blue chips (9M 2025, points)
Source: Companies’ data, InterCapital Research
Among the companies with positive net leverage, Atlantic Grupa is the most indebted at 3.3x EBITDA. The ratio reflects pressure from both ends – lower EBITDA driven by historically elevated coffee input prices, rising cocoa prices, and increased employee-related investments, and higher gross debt following the issuance of EUR 80m in new corporate bonds. While this places Atlantic above the typical 3x threshold, we expect gradual EBITDA normalization and bond amortization to bring leverage back toward its historical ~2x range.
Valamar Riviera follows with 2.4x, supported by ongoing investments in capacity expansion and higher-end hospitality offerings. Podravka stands at 2.0x, a noticeable increase from near-zero leverage at the start of the year due to financing the acquisition of Agri companies from the Fortenova Group. Adris Grupa reports 0.6x, though it is important to note that only cash and short-term deposits are included in its cash position. Broader financial assets are excluded as they are primarily tied to Croatia osiguranje, an insurance company, and are not considered available for servicing corporate debt.
Potential additional debt to reach 3x EBITDA (EURm)
Source: Companies’ data, InterCapital Research
In terms of additional headroom before reaching the 3x leverage ceiling, Hrvatski Telekom stands out with a substantial EUR 1.45bn in additional debt capacity. HT is followed by Končar Group (EUR 963m), Končar D&ST (EUR 733m), Adris Grupa (EUR 546m), Podravka (EUR 202m), ING-GRAD (EUR 148m), Ericsson Nikola Tesla (EUR 110m), and Valamar Riviera at EUR 79m of additional debt capacity.
This figures highlight the significant financial flexibility within the Croatian blue chips, indicating ample room to support new investments, expansion initiatives, or M&A activity through additional borrowing if required.
Moreover, none of the CROBEX10 constituents derive more than 50% of their capital structure from debt financing. Atlantic Grupa has the highest share at 44%, followed by Valamar Riviera at 42%. At the lower end are Končar D&ST at 5.6%, Hrvatski Telekom at 4.5%, and ING-GRAD at only 2.2%.
Capital structure of CROBEX10 constituents (9M 2025, % of the total funding)
Source: Companies’ data, InterCapital Research
Several structural factors explain the companies’ consistent reliance on equity. Firstly, historically strong capital bases, partly linked to past or current state ownership, and dominance of pension and state funds as key shareholders, emphasize the financial stability and conservative leverage. Also, the country’s prolonged crises in the past couple of decades contributed to risk aversion, which shifted many corporate financial policies toward maintaining low debt levels. Furthermore, the domestic corporate debt market can be considered underdeveloped, as bond issuance remains infrequent, limiting non-bank financing options. This is gradually improving, as evidenced by this year’s successful bond issues from Atlantic Grupa and Span Group, the latter excluded from this analysis as its was recently replaced in the index by ING-GRAD.
Croatian blue-chip companies maintain conservatively leveraged balance sheets, with many operating in outright net cash positions. While firms such as Atlantic Grupa and Valamar Riviera exhibit higher indebtedness, the overall market remains significantly under-leveraged. With substantial debt capacity available, these companies are well placed to fund future investments, acquisitions, and operational upgrades through additional borrowing if strategically justified. Nevertheless, structural characteristics of the Croatian market suggest that equity-heavy capital structure will continue to dominate, keeping leverage relatively subdued in the foreseeable future.