For today we decided to look at EBITDA and net profit margins of Croatian companies, for which we used 9M 2021 figures.

Last week, all Croatian blue chips published their 9M 2021 results. As a result, we decided to present you with an updated EBITDA and profit margin analysis. It is important to note that comparing the margins across the selected companies is not necessarily the best way to do the comparison as many companies operate in different industries. Since both EBITDA and profit margin reflect to a great extent the industry in which the company operates in, we advise comparing it to the peer average or median. Nevertheless, it is still worth seeing which Croatian companies are more profitable and therefore have more “room” to potentially reduce the prices of their goods or services if needed, while still remaining at a higher level of profitability.

EBITDA (TTM) margin of Selected Croatian Companies (%)

In 9M, 11 out of 13 observed companies reported a double-digit EBITDA margin. Atlantska Plovidba noted the highest margin of 52.8%, a very solid improvement compared to 9M 2020 (+27.9% YoY). In 9M 2021, Atlantska Plovidba benefited from a sharp increase in the average daily freight rate which stood at USD 15,408 per day (roughly +88% YoY). Next comes Valamar with EBITDA margin of 47.9%. We note that Valamar’s EBITDA in 9M 2021 almost tripled to HRK 818m due to strong growth in revenue (+135%), continued state support, and efficient cost management and adjustment of business to the pandemic environment.

On the flip side, Span’s EBITDA margin reached 7.1% We note that SPAN’s EBITDA reached HRK 27.32m, showing an increase of as much as 59.9% YoY. Meanwhile, EBITDA before one-off items (expenses incurred for the ZSE listing) increased by 93%, to HRK 32.9m.

Profit (TTM) margin of Selected Croatian Companies (%)

Turning our attention to the profit margins, Maistra leads the list with 22.3%, followed by Atlantska Plovidba with 21.6%. Valamar Riviera and Atlantic Grupa follow with a profit margin of 13.6% and 7.6%, respectively.

If you wish to compare EBITDA and net profit margins of these companies to their regional sector peers, you can do so by looking at our daily trading multiples which can be found here.

ATPL ended the day in red, amid a continuous decrease of the BDI index.

Atlantska Plovidba, a Croatian shipping company, has lost 17.8% of its share value yesterday on the back of the continuous decline of the Baltic Exchange Dry Index (BDI). This index, which measures the rates for capesize, panamax, supramax and handysize vessels has over the last month fallen by over 30%, with today marking the lowest point since August 11th.

The main reasons for this decline are cited as continuous concerns oversupply and demand, the health of the Chinese economy, as well as the latest Chinese intervention in the coal markets.

This all had a domino effect on Atlantska Plovidba, which finally resulted in the aforementioned decrease in share price. However, one should take note of the Company’s performance over this year, as it is still one of the best-performing stocks on the Zagreb Stock Exchange, with a YTD increase of 169% even when today’s decline in share price is included. Note that yesterday’s share price closed at
HRK 398, while ATPL ended up being the most traded share on ZSE.

As a reminder, the company recently published their 9M 2021 results, according to which sales increased by 70%, EBITDA increased by 224%, while net profit reached HRK 91.1m (compared to a net loss of HRK -51.07m in 9M of 2020). To read more about the company’s 9M results, click here.

YTD Share Price Performance of ATPL