Today marks exactly one year since Span was listed on ZSE. During the year, Span managed to increase its revenue by 4%, EBITDA after one-off by 113%, and bottom line by 230%. On the market, SPAN’s share price held above its IPO price of HRK 175. If an investor bought SPAN on the IPO, he would currently have a 36.6% YoY return (excluding a DY offered). We note Span’s share price amounted to HRK 218 on the open of the first trading day, which is above the IPO’s price.

Span key financials (H1 2022 vs. H1 2021, HRKm)

Today marks exactly one year since Span was listed on ZSE. It has been a solid year in terms of Span’s share price performance. During this period, at all time price held above its IPO price of HR 175. If one bought Span’s shares on the IPO, currently his position increased 36.6% YoY with yesterday’s closing price amounting to HRK 239. We note Span’s share price amounted to HRK 218 on the open of the first trading day, which is above the IPO’s price. If one missed an IPO opportunity and bought it on the opening of the trading session, he would still make a favor for his wallet, achieving a 9.6% increase in price.

Further, in June, Span approved the proposed dividend of HRK 5 per share, which implied a 2.3% DY compared to the price before the proposal. According to the decision, Span paid out HRK 9.55m to its shareholders, which translated to a 40% payout ratio. According to the Company’s dividend policy published in February, 20% to 50% of the consolidated profit will be paid in the form of dividends.

Market-wise, Span also adopted Share Buyback Programme and signed a Market Making mandate

At the start of 2022, Span adopted Share Buyback Programme with a maximum of 30,000 own shares, which will last for another 4 months. The Company will be acquiring its own shares for the purpose of employee remuneration. In the programme, the price at which the shares can be purchased cannot be 5% higher than the average market price of the share achieved on the regulated market during the previous trading day. We are pleased with the fact that Span chose InterCapital for the purpose of executing the mentioned program.

Besides Share Buyback Programme, InterCapital also executes a market making mandate for Span with the idea is to enable investors to buy or sell the shares (up to a certain size) at any time within a reasonable volatility range.

Span and CROBEX10 price performance since Span IPO (22 September 2022 – present, %)

At the share price before the dividend announcement, this would amount to a DY of 4.11%. The ex-date is set for 27 September 2022.

After the GSM meeting which was held yesterday, 22 September 2022, Valamar Riviera’s subsidiary, Imperial Riviera published a document pertaining to the resolutions from the GSM. According to the document, a dividend payment in the total amount of HRK 79.6m would be paid out from retained earnings from 2016, 2017, 2018, and 2019, in the following way: HRK 820.8k from 2016, HRK 15.2m from 2017, HRK 18.8m from 2018, and HRK 44.7m from 2019.

This would mean that the dividend per share amounts to HRK 34.92, which at the share price before the dividend announcement would amount to a dividend yield of 4.11%. As a reminder, Imperial Riviera did not pay out a dividend in 2021 due to receiving the government’s COVID-19 pandemic support. With 1 August being the first date that the companies that received this support could pay out dividends, later dividend payments were expected. Valamar Riviera itself already approved the dividend payment, of which you can read more here.

The dividend ex-date is set for 27 September 2022, while the payment date is set for 29 September 2022.

At the end of August 2022, the total AUM (Assets Under Management) of Slovenian mutual funds equaled EUR 4.07bn, representing a decrease of 1.9% MoM, 6.1% YTD, but an increase of 0.5% YoY.

The Slovenian Securities Market Agency (ATVP) has published the latest monthly report on the developments evidenced by the Slovenian mutual funds. By the end of August 2022, the Slovenian mutual funds had a total of EUR 4.07bn of AUM, representing a decrease of 1.9% MoM, 6.1% YTD, but an increase of 0.5% YoY. This comes after July 2022’s notable increase, during which the mutual funds AUM increased by 6.7% on an MoM basis.

With Slovenian recording an inflation rate of 11% in August 2022, recording no change on the monthly level, we can see that for the moment, the inflation has somewhat stopped its growth. Several factors can be attributed to this; firstly, the decision of the ECB to increase interest rates more aggressively (the most recent increase being 0.75 bps), the EU-wide movement to curb the dependence on Russian gas, as well as the fact that prices of oil and gas have somewhat decreased, due to the worse macroeconomic situation in the world, overall. In a way, investments can be seen as an indirect measure of current market sentiment, with better economic times and stronger outlooks providing more incentive to invest in riskier types of assets. Vice versa is also true during times of economic downturns, or at least times of slower expected growth and uncertainty. Of course, the decrease in total AUM can be due to several things: an overall decrease in the value of assets, the redemption of shares by the investors, or a combination of these two things. While all of this is happening, the switch from riskier (e.g. shares, inv. funds) to less risky (e.g. bonds, deposits) can also be made. A change from investment into foreign or domestic equity, or vice versa, can also happen.

Having all of this in mind, what of these things did happen?

Equity holdings of Slovenian UCITS funds (EURm)

Looking at the equity holdings first, we can see that overall, both domestic and foreign equity holdings decreased, by 13.2% and 2.5% YoY, respectively. This would mean that by the end of August 2022, domestic equity holdings amounted to EUR 59.8m, while foreign equity holdings amounted to EUR 2.78bn.

Total assets of Slovenian mutual funds (EURbn)

Moving on to the asset structure of the Slovenian mutual funds, shares still maintain the vast majority of the total AUM, at 69.5% (or EUR 2.83bn), representing a decrease of 0.1 p.p. MoM, and 0.9 p.p. YoY. Following them, we have bonds, at 15.7% (or EUR 641m) which decreased by 0.2 p.p. MoM but increased by 0.1 p.p. YoY. Investment funds, which account for 7% of the total (or EUR 284m) increased by 0.3 p.p. MoM but decreased by 0.7 p.p. YoY, and finally, money market, deposits & cash, at 7.2% of the total (or EUR 295m), remained roughly the same MoM but increased by 1.7 p.p. YoY.

Finally, taking a look at the number of subscribers and the net contributions, despite the challenging macroeconomic situation, the number of subscribers increased to 505k, representing an increase of 3.73% YoY, while the net contributions into the funds amounted to EUR 20.95m. However, if we looked at the last twelve months, the net contributions amounted to EUR 314.9m, which is a decrease of 15.6% when compared to the same period last year.

Net contributions in Slovenian mutual funds (EURm)

So, as we can see from the August 2022 data, investments in the Slovenian mutual funds are still continuing, with a growing number of subscribers each month. At the same time, however, the net contributions are slowing down, which is to be expected due to the higher inflation rates and lower disposable income of households. The value of equity holdings in the funds is decreasing, both in foreign and domestic equity. This could be both due to the fact that equity, both domestic and foreign, has lost some of its value this year due to the uncertain macroeconomic environment, while at the same time, fund managers are switching investments into less risky types of assets, such as bonds and the money market, deposits, and cash.