Croatia’s largest net exporter, KONČAR Group has just disclosed record business results for the period January – September 2023, which indicate that the company is on track to achieve its third consecutive year of record-breaking performance, with a special focus on order intake. Consolidated revenue generated from the sale of goods and services amounts to EUR 601.1 million, representing a growth of EUR 128.2 million or 27.1% on Q1-Q3 2022. Export revenue accounts for 67% of the total sales revenue, up by 34% year-over-year. High expectations are underpinned by record backlog of EUR 1,412.7 million, with a 45% growth in order intake value.

All business segments have experienced rising revenues and profit, with remarkable performance of the power transmission and distribution segments. KONČAR has successfully maintained the position of a regional leader in this segment and is recognized as a relevant European high-tech manufacturer of equipment and solutions that supports the green energy transition throughout the European Union. Export reaches a high 67% of total sales revenue, and continues to expand across all markets, with significant growth realized in the EU market, where export rose by EUR 60.1 million. More specifically, export to the European Union countries reaches EUR 283.5 million and accounts for 70.2% of the total export.

Exceptional sales results drive further profitability expansion. Reported net profit for the first nine months of 2023 totals EUR 48.3 million, which is a 29.8% rise on Q1-Q3 2022 performance. Normalized net profit doubled from EUR 23.7 to EUR 40.4 million year-on-year. EBITDA normalized amounts to EUR 56.1 million and is EUR 23.8 million or 73.7% higher on 2022 performance. Additionally, normalized EBITDA margin stands at 9.3%, while in Q1-Q3 2022 it amounted to 6.8%.

“We are particularly delighted by the value of order intake, which now exceeds EUR 1 billion, predominantly to be realized in foreign markets. The trust and reliability that we have been building up over decades have ensured a substantial influx of new orders, in particular from the advanced markets of Germany, Sweden, and Austria. The value of backlog reaches EUR 1,412.7 million. Notably, backlog to be realized in 2024 totals EUR 741 million. The breakthroughs across all business segments are a direct outcome of the transformational initiatives we have undertaken over the last four years, prioritizing responsiveness to market trends and demands, as well as investments in our people. By the end of the year we anticipate that our income will outperform our plans”, says Gordan Kolak, KONČAR’s CEO.

More prominent new orders in Q3 include a successful domestic market project – the Procurement Agreement with Gradski prijevoz putnika Osijek, for new low-floor trams as part of the modernization of the tram fleet in Osijek. The EUR 18.5 million Agreement will see the delivery of 10 new low-floor trams within the project The application of green technologies in railway passenger transport included in the 2021 – 2026 National Recovery and Resilience Plan (NRRP). In terms of export, we should highlight that the majority of agreements pertain to the German and Swedish subsidiaries of E.ON Group. The tenders were won in fierce competition with renowned European power transformer manufacturers, and the EUR 50 million deals are to be realized in the upcoming period.

At the meeting of the Supervisory Board and the Management Board held on 31 October, the business results for the period January – September 2023 were accepted. The Broads also accepted the offer issued by Construction Line Limited to purchase a business share in the limited liability company Advanced Energy Solutions Ltd., which holds 75.16% of the shares of the joint-stock company Dalekovod. In line with KONČAR Group strategy of consolidating ownership and acquiring control to fully integrate DALEKOVOD Group into KONČAR Group, and recognizing KONČAR’s primary role as a strategic investor seeking to leverage the synergies between the two groups, this acquisition represents an opportunity for further growth of KONČAR Group.