Business news

Mercator ended 2020 deep in the red despite higher revenue

Ljubljana, 27 April (STA) - Mercator, Slovenia's largest retailer, saw revenue rose by 1.6% to EUR 2.17 billion in 2020. But it ended the year with a net loss of EUR 156.7 million, largely due torevaluation of property and impairments to other assets.

Excluding non-recurring results, the group would have posted a net profit of EUR 4.7 million, on a par with the figure for 2019, according to an earnings report released Monday night.

Normalised profit before income tax, depreciation and amortisation (EBITDA) declined by 4.5% to EUR 162.7 million.

The company emphasised that its core business, retail revenue, rose by 3.7% to EUR 1.76 billion, while in Slovenia, its most important market, sales were up by more than 5%.

"Despite the highly challenging business conditions, Mercator Group succeeded in attaining a number of key strategic goals in 2020," CEO Tomislav Čizmić was quoted as saying.

"Regardless of the restrictions brought about by the epidemic, we considerably increased our revenue and further cut our leverage."

The company has calculated that the epidemic had a direct negative impact on the bottom line of EUR 18.8 million, a figure that includes shorter working hours, Sunday closures, school closures, and the long shutdown of the entire hospitality sector, all of which affected revenue.