IC Market Espresso 29 Aug 2022

Luka Koper Publishes H1 2022 Results

In H1 2022, Luka Koper reported a revenue increase of 35% YoY, an EBITDA increase of 95% YoY, and a net income of EUR 41.1m, an increase of 169% YoY.

Luka Koper’s net revenue amounted to EUR 155.1m, representing an increase of 35% YoY, as well as a 29% increase compared to the H1 2022 plan. The increase was driven by an increase in maritime throughput, which increased by 13% YoY, and 11% compared to the H1 2022 plan, amounting to 11.7m tonnes. Container throughput increased by 3% both YoY and compared to the plan, amounting to 526.5k TEUs. Cars throughput also increased, by 11% YoY and 6% compared to the H1 2022 plan, amounting to 367.3k units. In particular, the higher net revenue can be attributed to warehousing due to the slower dispatch of goods resulting from the current situation in the global logistic market. Luka Koper also notes that as the situation normalizes, the growth of these revenues is expected to decline. Higher revenues can also be attributed to rising prices and increased volume of throughput and additional services.

Growth can be seen across almost all the cargo groups. General cargoes increased by 25% YoY and amounted to 700.7k tonnes, mainly as a result of increased throughput of steel products and caoutchouc. At the same time, a 20% lower export of timber was also recorded, but the trend of containerisation of these goods has been positive, which is reflected in the increase of additional services of container stuffing. Container throughput also increased, growing by 3% and amounting to 526.5k TEUs, despite the deviations in land shipments for and from ports, mainly as a result of shipment delays from the congestion of major Chinese ports. It should be noted, however, that the throughput of containers in terms of tonnes remained roughly the same YoY, at 5.03m tonnes. Meanwhile, 367.3k cars were transhipped, which is 11% higher YoY (if we were to look in terms of tonnes, this amounts to 639.7k tonnes, which is 18% higher YoY). The main increase was in the segment of electric vehicles. The Group notes, however, that car manufacturers are still facing semiconductor and other automotive parts shortages, which is also exacerbated by the war in Ukraine, which is also causing certain stoppages in production.

Maritime throughput in tonnes (H1 2022 vs H1 2021)

Liquid cargo throughput increased by 41% YoY, generated by all cargoes of this type, but foremost by resumed throughput of jet fuel, which increased by 37% YoY. Finally, dry and bulk cargo increased by 20% YoY, especially in the throughput of industrial salt and other dry bulk cargo. The share of the dry bulk and bulk cargoes increased by 2 p.p. YoY, whilst the share of the liquid cargoes increased by 1 p.p. YoY. The share of cars remained unchanged.

Structure of the maritime throughput by cargo groups (H1 2022 vs. H1 2021, %)

Meanwhile, operating expenses grew by 11% or EUR 10.4m, with all types of costs increasing. Costs of material and energy were the ones which increased the most, due to higher consumption of motor fuel and higher electricity prices, as well as higher costs of spare parts due to higher volume of maintenance works. At the same time, higher maritime throughput and higher revenue increased the cost of port services, as well as the transshipment and concession fees. Labour costs also increased due to a higher number of employees, higher payments for job performance, and adjustments of salaries for inflation. Higher amortization costs were also recorded due to new purchases of assets, while other op. expenses increased due to value adjustments of trade receivables and higher costs of compensation for the use of construction land. Even so, op. expenses to sales amounted to 70.3%, 15.7 p.p. lower YoY. With the faster revenue than op. expenses growth, EBITDA increased significantly, amounting to EUR 61.9m, up 95% YoY. The net financial result increased by 27% YoY, mainly as a result of higher financial income, while the financial expenses increased only slightly. In the end, Luka Koper’s net income increased by 169% YoY and amounted to EUR 41.1m.

The Company also commented on its investments, which amounted to EUR 31.9m in H1 2022, representing an increase of 6% YoY and 62% compared to the plan. This will be mainly towards investments into property, plant and equipment, property investments, and intangible fixed assets. In particular, the following investments were made: The purchase of two SPPX cranes for the needs of the container terminal, continued extension of Pier 1, and upgrading of the anti-dust system, among many others.

Luka Koper key financials (H1 2022 vs. H1 2021, EUR)

Impact of the Russia-Ukraine conflict on Luka Koper

Luka Koper also commented on the Russia-Ukraine conflict’s impact on the Company’s performance and said that it has no relevant impact on the Company’s strategic direction and goals. Due to the small volume of business in the affected region and consequently lower exposure, adverse conditions will not materially impact the operating result. Low indebtedness, increased volume of business, favourable liquidity position, as well as the fact that the Company’s liabilities are settled to maturity, are also helping the Company’s situation. Luka Koper also has no direct financial exposure to Russia, Ukraine, or Belarus, but as developments on the stock market materialized in H1 2022, the value of the Company’s stock decreased. A negative impact on the Company’s financial accounts, which may be the effect of the war, was the change of the surplus from the change of the revaluation surplus of finance investments of companies exposed to countries related to the conflict, in the amount of EUR 10.7m. Furthermore, Luka Koper estimates the war may indirectly impact the Group’s performance in 2022, with an effect to supply chains and logistics. Current trends in energy, raw materials, and food markets affected by the war show additional inflationary pressures, which will also affect the Company, leading to higher op. costs.

Luka Koper’s objectives until 2025

Luka Koper also commented on a set of objectives for 2025. They target a total op. revenue increase of 24%, by using the synergies in the logistics chains, acquiring new strategic markets, applying a renewed long-term and targeted commercial policy, and ensuring that the revenue structure is targeted at higher value-added groups. The Group is also targeting an increase in total transshipment to 27.3m tonnes by 2025. The investment will be made towards increasing the capacity and throughput of the port by 2025, while awaiting the renewed twin-track line to be ready, thus increasing the advantages and opportunities of this route. The goal is to increase the transshipment quantities by rail to 60%, while after the track renewal is complete, to 70%.

Also, we would like to remind you that tomorrow, 30 August 2022, is the ex-dividend date for Luka Koper. If you would like to read more about the dividend, click here.

Croatian GDP up 7.7% YoY in Q2 2022

On Friday, the Croatian Bureau of Statistics published its first estimate for the GDP in Q2 2022. According to the estimate, the GDP grew by 7.7% YoY in real terms. In H1, GDP increased 7.4% in H1 2022 in real terms.

According to the first estimates of the Croatian Bureau of Statistics, GDP grew by 7.7% YoY in real terms in Q2 2022. It should be noted that this refers to the non-adjusted data. According to the seasonally adjusted data, the GDP increased by 2% compared to the previous quarter, 7.8% YoY. In H1, GDP increased 7.4% in real terms.

Final consumption, the largest contributor to the GDP, increased by 4.7% in Q2 2022, continuing the economic growth (and recovery) that started in Q2 2021 with the complete easing of COVID-19 measures and the total reopening of the economy. This is also evident if we look at the households (the largest contributor to the final consumption at 75%), which grew by 7.7% YoY. However, we note current inflationary pressures are persistent with inflation numbers peaking, which might discourage further growth in final consumption resulting in lower growth rates in the second half of the year. Next up, we have the General government (making up the remaining 25% of the final consumption), which decreased by 2.2% YoY. Meanwhile, Gross fixed capital formation increased by 5%, and this number is expected to keep growing as more funds from the EU continue to be implemented in the economy.

Further, we note that the highest nominal impact was recorded in changes in inventories, which grew from HRK 9bn to HRK 14bn in Q2 YoY. This increase of HRK 15bn in changes in inventories boosted Total gross capital formation, which is one of four main GDP categories.

At the same time, the export of goods and services increased significantly, growing by 41.9% YoY. Tourism has significantly affected growth of GDP while the export of services grew by 65.7% YoY. It is also very positive that the export of goods continues to grow with double-digit figures (26.5% YoY), showing increased demand for domestic products. This is further evidence that the complete easing of measures and border restrictions has significantly impacted the growth of exports.

On the other hand, the import of goods and services also grew significantly, increasing by 28.6% YoY. Out of this, goods grew by 30.7%, while services grew by 15.1%, due to the fact that imports which amounted to HRK 67.8bn, were relatively higher than exports (HRK 61.5bn). This means that even with higher export growth, there were still net negative exports of HRK -6.3bn reported. Nevertheless, the recovery of tourism contributed to GDP growth due to mentioned better net negative export results.

In total, GDP in H1 2022, in real terms amounted to HRK 165.242bn, representing a 7.4% increase YoY. As the current inflationary pressures peak and the supply chains are still in a precarious situation (but much better than compared to 2021), the GDP growth is expected to continue. However, this growth should happen at a slower pace than especially the levels seen in 2021 (it should be noted that Q3 2021 GDP growth amounted to 15.1%, and Q4 amounted to 9.7%) meaning that the base is also higher. As such, and according to most forecasts for FY 2022, the growth should be between 3-4%.

Croatian GDP, real growth rates (%, YoY)*

*Quarterly Gross Domestic Product, seasonally adjusted real growth rates

Banca Transilvania H1 2022 Results

In H1 2022, Banca Transilvania recorded a net interest income growth of 33%, net fee and commission income increase of 23%, operating income growth of 18%, and a net profit of RON 1.05bn, an increase of 3% YoY.

The Group’s net interest income amounted to RON 2.03bn, an increase of 33% YoY, driven by the increased level of lending. In fact, 140k loans were granted by the bank during H1 2022, with a total value of RON 14.2bn. In total, as compared to the YE 2021, the balance of loans granted by the Group reached RON 64.9bn, an increase of 15.6% compared to YE 2021. Also, the Group attracted 285k new customers, reaching 3.75m. Net fee and commission income also increased, growing by 23% YoY to RON 550.9m. Combined, this led to an operating income of RON 2.83bn, an increase of 18% YoY.

During the same period, operating expenses also increased significantly, growing by 31% YoY and amounting to RON 1.63bn. The growth was driven by higher impairments on financial assets, which increased by 36% YoY and amounted to RON 204.8bn. At the same time, higher personnel expenses also occurred, growing by 26% YoY and amounting to RON 818.5m. Other operating expenses also increased, growing by 47% YoY and amounting to RON 446.3m. The impairment increase can be attributed to the current macroeconomic uncertainty, and the Company is preparing for all eventual scenarios in the near future, increasing this number. Personnel expenses can be attributed to the double-digit inflation growth that Romania has recorded for the last few months, meaning that Banca Transilvania has to offer higher wages, thus driving personnel costs.

Due to strong operating expenses growth, the impact on the profit before taxes was recorded, with it growing by 3% YoY and amounting to RON 1.2bn. Finally, the H1 2022 net income increased by 3%, growing to RON 1.05bn.

Banca Transilvania key financials (H1 2022 vs. H1 2021, RONm)

Moving on to the balance sheet, the total assets of the Group increased by 6% compared to the beginning of the year and amounted to RON 140.1bn. The growth was driven mainly by an increase in financial assets at amortized cost, which increased by 41% YTD and amounted to RON 95.3bn. This, in turn, was driven by higher loans to customers, which increased by 14% YTD and amounted to RON 62.2bn, as well as higher amounts of debt instruments, which increased by 16x YTD and amounted to RON 24.7bn. Meanwhile, placements with banks decreased by 34% YTD and amounted to RON 10.3bn. Meanwhile, financial assets measured at fair value also decreased, declining by 51% YTD and amounted to RON 20.2bn.

On the other hand, total liabilities amounted to RON 130.2bn, an increase of 4% YoY. This increase was driven by higher deposits from customers, which increased by 3% YoY and amounted to RON 110.9bn. Loans from banks increased by 59% YoY and amounted to RON 12.6bn. Deposits from banks increased by 43% YoY and amounted to RON 1.46bn.

Upcoming Events – August 2022

Here you can find the dates for the upcoming events of the regional companies.

wdt_ID Date Ticker Announcement Country
187 30.8.2022 LKPG Luka Koper dividend shareholders' record date Slovenia
186 31.8.2022 UKIG Unior Q2 2022 Results Slovenia
185 31.8.2022 LKPG Luka Koper dividend payment Slovenia
184 31.8.2022 CICG Cinkarna Celje Q2 2022 Results Slovenia
183 31.8.2022 FP Fondul Proprietatea Q2 2022 Results Romania
182 31.8.2022 FP Fondul Proprietatea conference call - Q2 2022 Results Romania
181 31.8.2022 - LJSE Investor Webinar, in partnership with InterCapital Securities Slovenia

Due to the nature of these events, they are subject to change (might be postponed or canceled).

Want to invest? Do not know how and where? Contact us and we will solve everything for you.