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Valamar Riviera: Revenue Growth of 20 Percent, Operating Profit of 45 Percent

Valamar Riviera from Poreč, the leading tourism company in Croatia, achieved consolidated business revenues of 1.223 billion kuna in the first nine months of 2015, representing a 20 percent increase compared to the same period last year. The consolidated operating profit (EBITDA) for the first nine months amounts to 556 million kuna, which is 45 percent higher than the same period last year.

The strong revenue growth in the first nine months is a result of a 15.3 percent increase in the number of overnight stays and a nearly 7 percent increase in the average price per comparable accommodation unit. Additionally, the average guest spending has increased as a result of continuous activities aimed at enhancing quality and product development through achieved investments and development. In 2015, the investment cycle in the existing portfolio worth 354 million kuna was completed, and the largest investment this year, Valamar Isabella Island Resort 4*, has achieved excellent results this season. 

In the portfolio structure, the highest revenue growth of 20 percent was achieved by 4 and 5-star hotels and apartments, confirming that continuous investments in increasing the competitiveness of tourism products, innovation, and quality are one of the key factors for successful and sustainable business in tourism.

According to the Management Report published on October 27, Valamar Riviera expects to achieve between 1.270 and 1.290 billion kuna in business revenues in 2015, representing a growth of 15.7 to 17.6 percent compared to last year. Revenue growth will also be accompanied by strong growth in consolidated operating profit (EBITDA), which will reach between 405 and 415 million kuna on an annual basis, an increase of 121 to 131 million kuna, or up to 46 percent higher than last year.

– The exceptionally good business performance in 2015 is the result of the synergy of several important factors – increased operational efficiency due to the reorganization and restructuring of the business, significant investments in the portfolio and services that have stimulated strong growth, the acquisition of Hotel Baška, and generally very good tourist season. The results so far are significantly better than last year’s and show that Croatian tourism provides a great perspective for companies investing in increasing the competitiveness of products and destinations. However, we still emphasize that the highest VAT rate in the Mediterranean and the unresolved issue of tourist land limit the potential of the tourism sector for further investments, so Valamar Riviera will reduce the level of total investments in the coming year. Tourism is still not sufficiently recognized as an opportunity for the Croatian economy, as there are no other measures besides existing financing programs through HBOR that would significantly accelerate growth and development and thus equalize overall competitiveness with others in the Mediterranean,  stated Željko Kukurin, CEO of Valamar Riviera.