Valamar Riviera Group Last Year with Revenues Up by 16.6 Percent and Profit Down by 28.4 Percent

Valamar Riviera Group achieved total revenues of 1.84 billion kuna last year, an increase of 16.6 percent compared to the previous year, while net profit decreased by 28.4 percent to 245.1 million kuna, according to the revised consolidated financial report published by this hotel and tourism company on Wednesday.

Valamar’s sales revenues last year amounted to 1.76 billion kuna, which is 20.6 percent higher than the previous year.

This growth is primarily the result of a 23 percent increase in pension revenues (accommodation, food, and beverage), which amounted to 1.45 billion kuna in 2017, as well as an increase in revenues from other operational departments (by 17 million kuna, including rental and sports revenues, laundry services, travel agency, etc.), Valamar explains.

>>>Valamar Riviera Wants Hotels Makarska

The growth in pension revenues, as noted by Valamar, was most influenced by the acquisition of the Imperial in Rab, an intensive investment cycle to increase competitiveness and improve the quality of facilities and services, optimization of distribution and price management in line with increased demand, as well as better occupancy rates and excellent business results during the first half of last year.

Last year, the group recorded over 6.17 million overnight stays, an increase of 20 percent compared to the previous year, and the average daily price also increased by 6.4 percent (from 516 kuna in 2016 to 548 kuna last year).

Valamar’s operating costs increased by 20.6 percent to 1.15 billion kuna. The company explains this by the consolidation of Imperial, an increase in material costs due to higher business volume, a policy of increasing employee salaries, and new hiring “which is necessary for carrying out the intensive investment cycle, as well as for providing quality service in new premium and upscale tourism products.”

>>>Valamar Guaranteed Earnings of at Least 5,000 Monthly

Valamar also points out that the group achieved a strong growth in adjusted EBITDA of 20 percent to 623 million kuna during the past year. This growth, they emphasize, is primarily due to the high increase in sales revenues and active management of operational efficiency, resulting in an adjusted EBITDA margin of 35 percent (compared to 34.9 percent in 2016). The high margin was achieved despite this year’s negative impact of a lower seasonal exchange rate of euro/kuna and an increase in the VAT rate on hospitality services from 13 to 25 percent as of January 1, 2017, Valamar explains.

On the other hand, the decrease in net profit by 98 million kuna to 244 million kuna compared to 342 million kuna in 2016 is explained by poorer results from financial operations (a decrease of 46 million kuna) and a lower amount of tax revenues (a decrease of 64 million kuna), largely due to a smaller one-time recognition of deferred tax assets related to achieved tax incentives based on the Investment Promotion Act and the improvement of the investment environment (54 million in 2017 compared to 125 million kuna in 2016).

>>>Valamar Riviera and TUI UK Signed a Contract for 2018 Worth About 80 Million Kuna

Valamar Riviera Group, along with last year’s acquisition of the Imperial in Rab, operates in five attractive destinations, from Istria and Kvarner to Dubrovnik, and manages about 12 percent of categorized tourist accommodation in Croatia. The portfolio of tourist facilities includes 30 hotels and resorts and 15 camping resorts. With nearly 21,000 accommodation units, it can accommodate more than 56,000 guests daily, confirming that it is the largest tourist group in Croatia measured by capacity, the company notes.

In the business report for last year, Valamar also emphasizes that the largest investment cycle of the group, worth over 900 million kuna, has been completed.

>>>Valamar Riviera and DER Touristik Signed a Contract for 2018

In accordance with the previously announced investment cycle of up to two billion kuna by 2020, the group plans to continue intensive investments this year amounting to 705 million kuna.

Valamar Riviera announced yesterday that the Supervisory Board proposed a dividend payment of 90 lipa per share.

According to the proposal, May 15 would be the date of entitlement to payment, and May 14 would be the date from which shares will be traded without the right to dividend payment (ex-dividend date). Shareholders who wish to do so will be able to receive a quarter of the corresponding dividend in rights – shares of Valamar.