CONSOLIDATED FINANCIAL BUSINESS RESULTS FOR THE FIRST HALF OF YEAR 2017
Since the most significant business indicators of Tigar A.D. company are unsatisfactory in the fist half of 2017, the new CEO and Supervisory Board of the company are determined to take urgent measures concerning the company's recovery.
In the period January – June company Tigar A.D. stated an operating loss in the amount of 98,210 thousand Serbian dinars, whereas in the same period last year was recorded an operating profit in the amount of 50,159 thousand Serbian dinars.
'Tigar A.D. consolidated operating income recorded a decline by 23% in relation to last year, which indicates the need to undertake swift and decisive actions in order to help the company recover. For the first time in the last four years EBIT is worse than in the previous year. This was an alert to take the appropriate measures after the conversions of debt into capital and changes in the ownership structure, such as undertaking activities concerning the relationship with creditors, finding new customers as well as resolving the status of service entities which have operated negatively for a longer period of time, said the new CEO Vladimir Ilić.
The main factor of decreased in sales volume when it comes to export in this period is the lack of deliveries of special protective boots for the need of Finnish market. Positive turnover growht in relation to the same period last year was realized by the new customers from Poland and Italy but in insufficient volume. The first half of 2017 marked reduced sales volume in export by 44% in relation to the same period in 2016 as a consequence of reduced demand from the existing large customers. When it comes to second largest customer from Italy, in the first half of 2017 were made organizational changes which reflected the reduced scope of realization in this period. According to the CEO intensive deliveries are expected until year-end.
In the part of settling obligations towards creditors, obligations are settled according to opportunities. There were held bilateral meetings with larger creditors and they were presented with the measures that the Company undertakes to overcome the problem, as well as with the need to write off part of the debts, reduce interest rates and extend the repayment period for the remainder of the debt toward creditors. Just to remind, in order to avoid blockage of the account due to delays in the settlement of obligations, in May 2017 was held a joint meeting of all larger creditors and representatives of the Ministry of Economy. It was concluded that it would be necessary to sign the Stand still contract until creditors have made final decisions on acceptance or non-acceptance of the corrections to the terms of the PPoR. The CEO states that we have not obtained answers from all creditors concerning the signing of the Stand still contract.
The first half of 2017 was marked by the VIII release of shares based on conversion of debt into capital, pursuant to the Conclusion of the Government of the Republic of Serbia, which led to significant change in Tigar A.D. ownership structure. The largest Company shareholder at the end of second quarter of 2017 is the Republic of Serbia which participates in the Company’s capital with 42,2%, whereas together with the Equity Fund of RS 5,60%, Pension and Disability Insurance Fund 9,54%, Republic Health Insurance Fund 1,59% and the National Employment Service 0,49% it has a total of 59,43%.
On 13 April, 2017 the Government of the Republic of Serbia passed the Conclusion on launching the initiative for privatization of Tigar A.D. company.