We report on Konzum’s results for the first five months of 2017. We also highlight how Agrokor’s retail business will be split between Konzum and Mercator in Bosnia-Herzegovina (BiH), outlining what this means for the wider market.
Konzum double-digit decline in first five months of 2017
Agrokor has released its Konzum results from the first five months and reported HRK 3.4bn (EUR 463mn) in Croatia and HRK 943mn (EUR 127mn) in BiH. Both results reflect a double-digit decline from 2016’s performance and losses of HRK 62mn (EUR 8mn) in Croatia and HRK 44mn (EUR 6mn) in BiH.
Break up of BiH operation in Q4 2017
Agrokor has announced plans to split its stores in BiH under the Konzum and Mercator banners starting from August. It was announced that Konzum retain 170 stores while the remaining 83 stores go to Mercator. Agrokor’s trustee, Ante Ramljak, announced the complete payment of BAM 80mn (EUR 41mn) of debts by September when Mercator and Konzum are expected to split.
Expansion opportunity for local retailers, especially Bingo
Bingo, BiH’s largest retailer, recently took over one of Konzum stores in the town of Zenica just north of Sarajevo. Agrokor’s trustee stated that there will also be Konzum store closures in BiH, as well as Croatia. He also commented that some local retail chains, such as Bingo, will negotiate the takeover of certain Konzum stores once they receive the go-ahead from the competition commission. Bingo became market leader in 2016 after the takeover of Interex and Tuš, which exited the country.
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Amin Alkhatib, Retail Analyst CEE, IGD International: based in London, UK, Amin is responsible for shaping IGD's research in Central and Eastern Europe; as well as contributing to IGD's broader European research programme. Follow me on Twitter @Amin_IGD for further insight on the region’s retail landscape.