STA, 28 August 2020 - The merger of Dnevnik and Večer, the publishers of the third and fourth largest daily newspapers in Slovenia, respectively, as per 2019 data, has come to a halt, Dnevnik's owner Bojan Petan of publisher DZS and Večer's co-owner Uroš Hakl have confirmed.

Petan implied at Dnevnik's general assembly on Thursday that there were disagreements over ownership, whereas Hakl told the STA today that the reasons for putting the merger on hold were a matter of business.

According to Kristjan Verbič, the president of the VZMD association of small shareholders, Petan explained the situation in more detail at the meeting.

After the Competition Protection Agency (AVK) gave a green light for the merger in July 2019, the necessary proceedings were meant to be launched. Petan said at the time that the go-ahead was only the beginning of long-lasting and legally complex procedures though.

The break-up operation of the limited company Dnevnik was envisaged, pending a nod from its supervisors and stakeholders, said Verbič.

Newspaper Dnevnik would be turned into a subsidiary which would merge with Večer. Other Dnevnik editions would remain under the core company, which would not participate in the merger. Both newspapers were meant to continue being published as separate papers.

Petan, Dnevnik chairman, announced a meeting which would address the issue after the AVK green light, but such a discussion has not yet taken place. The merger was supposed to be finished by now though.

As quoted by Verbič, Petan explained on Thursday that the procedures got complicated after an independent value estimate of newspapers Dnevnik and Večer was requested. The estimate showed that Večer was worth some EUR 100,000 more than Dnevnik.

According to a previous agreement the companies would share ownership of the new entity called DV Mediji and Petan suggested Dnevnik contributed additional EUR 100,000. However, out of reasons unknown to him, Večer no longer agreed to that or to shared ownership and wanted a stronger share, said Verbič.

Petan told Dnevnik stakeholders on Thursday that the situation could be only the other way around since Dnevnik had been recording good results and had seen only a 2-3% drop in revenue.

He also highlighted that the AVK go-ahead remained, implying that the story could get an ending.

Rumours about the deal breakdown have been circulating, however Hakl has been denying any claims about that. Today, he was reticent about the situation, only saying that the procedure was put on ice.

Hakl later spoke to the STA to reject the allegation that the disagreements over ownership were the reason, saying instead that the true reason was an unrealistic appraisal of Dnevnik made on the basis of five-year business projections.

He said that these were made based on unrealistic costs of print and projections that revenue from advertisement marketing would grow by 10% a year.

"There is no media house globally which is capable of growing by 10% annually in advertisement marketing, let alone Dnevnik, which has recorded a noticeable trend of decreasing revenue from advertising," he was critical.

Hakl said he had no resentment and that Večer still thought that a merger made sense business-wise and that it would be a smart decision for the survival of both newspapers, "but in a professionally appropriate way".

The Maribor-based Večer, controlled by the no. 1 publisher Delo until 2014 when it was sold to entrepreneurs Hakl and Sašo Todorovič due to anti-trust concerns, has a circulation of about 19,000, according to 2019 data, and a strong subscriber base in the north-east of the country, while Dnevnik has a circulation of 21,000 and is considered more a central Slovenian or Ljubljana-based paper.

STA, 27 August 2020 - Representatives of Slovenian farmers have made an urgent appeal to the government to intervene in the market since some purchase prices are so low they do not even cover the cost of production.

Purchase prices have been declining for many years but "the situation has never been so bad before," Anton Medved, the president of the Trade Union of Slovenian Farmers, told the press on Thursday.

"Value added tax amounts for a higher proportion of the price of a loaf of bread than the money the farmer gets for his wheat," he said.

The union wants the government to reintroduce monitoring of retail prices of food on store shelves and establish fair relations in the food supply chain.

They also want the introduction of mass balances, a system whereby inputs and outputs are measured based on origin.

Medved said prices had declined by 15-30% since the outbreak of the novel coronavirus. "In the long term, this means ruin."

Listing the reasons why the government should intervene, Medved said Slovenian farmers will never be able to produce vegetables as cheaply as large Italian or Spanish farms, which he said were exploiting workers.

As things currently stand, Slovenian farms are being abandoned. "When young farmers see that farming no longer pays off, they will stop farming," he said.

STA, 25 August 2020 - Net profit at port operator Luka Koper declined by 40% year-on-year to EUR 15 million in the first six months of 2020, as net revenue was down 11% to EUR 107 million. All cargo categories were affected by the slowdown in trade, shows the company's interim report released on Tuesday.

Pre-tax profit (EBIT), at EUR 17 million, was down 42% compared to the same period last year and profit before interest, taxes, depreciation and amortisation (EBITDA) dropped by 29% to EUR 31 million.

While the crucial container segment fared reasonably well, declining by 4% in tonnage and TEU terms, sharp declines in throughput were recorded in other cargo categories.

Dry and bulk cargoes were down by 26%, liquid cargoes by 14%, cars by 18% and general cargoes, which account for the smallest share of overall cargo volumes, by 32%.

Total transshipment, expressed in tonnes, declined by 15% to 10.1 million tonnes.

The figures show the coronavirus pandemic had a significant impact on world trade, but North Adriatic ports were actually not among the worst affected, the company said.

In the container segment, Koper and the neighbouring ports were not confronted with shipping line cancellations that the northern European ports had to face.

In the car segment, Koper even overtook both Spanish ports which are comparable to Koper in terms of cars volumes, CEO Dimitrij Zadel was quoted as saying.

Zadel said it was difficult to predict the end-year figures but the company was "taking measures to ensure access to a sufficient amount of liquid assets to overcome these impacts".

STA, 22 August 2020 - The gap between the minimum and average wages in Slovenia stood at 50.6% in 2019, which made the country the EU member state with the narrowest gap, data from Slovenia's Institute of Macroeconomic Analysis and Development (IMAD) shows.

Since Slovenia introduced the minimum wage in 1995, legislation has been amended on several occasions changing the manner in which the minimum wage is set or raised.

In 1995-1997, it was generally harmonised in the same manner as the base pay in the private sector.

In the following period until 2003, a mechanism was introduced basing its increase not only on inflation but also on GDP growth in real terms.

In 2004-2005, the minimum wage was set in a nominal sum, and rose more than the average pay in the private sector but less than if pegged to GDP growth in real terms.

The anticipated inflation was meanwhile the only indicator to which the minimum wage was pegged in 2006-2009.

In 2010-2018, the minimum wage was pegged to inflation from the previous year, whereas pay and employment trends, and the general economic situation could also be taken into account.

Under the 2018 changes to the minimum wage law, the amount set as the minimum cost of living will also be taken into account in setting the minimum wage as of 2021.

Over the past 25 years there have been two major minimum wage raises, which have brought the minimum wage closer to the average salary.

The first kicked in in 2010, when it rose from EUR 593 gross to EUR 734, but companies allowed to complete the transition until the end of 2011.

The changes from 2018 brought the other major increase, to EUR 887 gross for 2019 and to EUR 940 for 2020.

Also, as of this year, all bonuses, for instance for night shifts or Sunday work, were excluded from the minimum wage.

They are now calculated not as part of the minimum wages but separately, which further raised the monthly pay of workers on the minimum wage.

As of next year, a new formula will kick in under which the minimum wage will have to exceeded the minimum cost of living by at least 20%, but not by more than 40%.

All these changes have resulted in a narrowing gap between the minimum and average wages; in 2000, the gap stood at 40.3%, at 45.4% in 2010 and at 50.6% last year.

What is more, minimum wage growth has exceeded productivity growth throughout the last decade.

Slovenia is one of 21 EU members states which have the minimum wage regulated in a law.

The ratio between the highest and lowest minimum wages in the EU-21 is roughly 1:7, or 1:3 if measured in purchasing power standards.

Luxembourg has the highest minimum wage in nominal terms and in purchasing power standards, with Bulgaria and Latvia at the bottom of the list, respectively.

In terms of purchasing power standards, Romania has seen the highest rise in the minimum wage in the past ten years.

Together with Portugal, Greece, Malta and Spain, Slovenia places in the middle group in terms of minimum wage growth. Last year, the minimum wage in the group ranged from EUR 700 to 1,050.

The ratio between minimum and average gross wages in the EU members which are also OECD members meanwhile ranged from 33.1% to 52%.

Here Slovenia topped the list with 50.6% in 2019, followed by France, while Greece had the widest gap to the average pay, IMAD said in its latest analysis of the minimum wage.

STA, 20 August 2020 - As soon as the strict coronavirus measures were relaxed at the end of April the property market picked up, yet there are still fewer transactions than before the epidemic. Demand still exceeds supply, keeping average prices high, partly because of the many deals in Ljubljana, where prices are well above the national average.

"At the moment there are fewer transactions on the property market," the director and owner of real estate agency Stan Nepremičnine, Stanka Solar, told the STA.

She said this trend could be seen over the past month, so she partly attributes it to the summer season and a lack of adequate supply of used flats at good locations.

Solar said demand was strong in particular for higher-end new housing, but she believes new flats or houses are "slightly mispriced given the buyers' expectations".

"The majority of people expect a price correction for property which needs energy renovation and for more expensive new housing."

Similarly, Boris Veleski from Mreža Nepremičnin said the number of transactions was much lower after the epidemic, even though a month after it the market started to rebound.

Remax Ljubljana said that "at this moment we don't see any major changes in transactions, as demand still exceeds supply".

Urška Hočevar from this estate agent said the market is dominated by strong, motivated buyers who have a clear vision and know how they will finance the purchase.

Preliminary data by Slovenia's Surveying and Mapping Authority (GURS) for the first six months shows some 5,400 deals with flats and houses were carried out, down 35% from the same period in 2019.

However, these transactions amounted to EUR 532 million, which is 70% of all property transactions, an absolute record for a six-month period, GURS has recently said.

According to Solar, there is much demand for one- and two-room flats, but also for three-room flats, especially second-hand properties which do not require major investments.

Flats with a lift and a parking area are also in high demand.

She said there is an increasing number of buyers who have some savings and deem a piece of property the safest investment.

Mreža Nepremičnin said there is a lot of demand for smaller flats, up to 65 square metres, but also for larger ones, over 100 square metres.

Remax said cheaper flats near the city centre are in high demand.

"However, already during the epidemic we detected some more demand for houses, holiday homes and land, as many found it hard to be in a flat during lockdown," said Hočevar.

GURS data also shows the prices of used flats rose by 7% in the January-June period compared to the same period in 2019, with an average price per square metre exceeding EUR 1,900 for the first time.

Solar corroborated this, saying "the prices of used properties have increased. Demand still exceeds supply and there is currently a lack of housing at desired locations into which a new owner could move in a few months".

She said the prices of rental homes had meanwhile dropped by some 15-20% compared to before the coronacrisis.

Mreža Nepremičnin and Remax have not noticed any price drops either. Hočevar said a downward correction was possible in the long-term.

Fewer tourists from abroad have meanwhile given a headache to many owners who took out loans to buy flats for short-term rental. These loans need to be repaid regardless of the current lack of demand by tourists.

"Some of these flats have been put up for sale, but not that many, other owners have opted for medium-term rental if they could, because many hope or believe that things will soon be the same as before the epidemic," said Veleski.

Solar said many of those who had been renting through Airbnb and Booking decided to rent to students or other individuals for the long or medium term.

Hočevar said that even those owners who insisted on short-term renting this summer in Ljubljana or other tourist areas will eventually be forced to rent for the long-term or even sell.

The estate agents largely agree that the pandemic has made it hard to predict the trends in the coming months.

Solar does not expect any major price changes until the end of the year, except for housing in need of energy renovation and for relatively pricey new housing.

Veleski believes much will depend on developments outside Slovenia's borders. He thinks the existing trend will last at least until spring 2021.

All our stories on property in Slovenia

STA, 18 August 2020 - Slovenian home appliance manufacturer Gorenje is hiring some 600 temporary workers to cope with a record number of orders. Orders until the end of the year are by more than 30% higher for each month than last year, while a 15-20% increase is also expected for early 2021, the company told the STA on Tuesday.

Since 10 August, Gorenje has already hired 240 workers on a fixed-term contract, and is looking for another 350, to be employed by 1 September.

Some of the new workers will be hired until the end of October, but the majority until the end of the year, said the company, which is part of the Chinese group Hisense.

"While a rise in orders is typical of this time of year due to the seasonal nature of production, we have an absolute record number of orders for this period now."

When the coronavirus pandemic hit this spring, Gorenje's new owners were planning massive layoffs.

Orders for August to October then rose significantly and June was the first profitable month this year.

The changed situation prompted the Hisense Gorenje management to resort to soft methods to improve efficiency in production at Gorenje.

Due to the pandemic, Gorenje has introduced a number of measures to boost sales, cut costs and increase production efficiency.

STA, 18 August 2020 - Slovenia's leading insurance group, Triglav, has reported EUR 33.5 million in net profit for the first half of 2020, a 3% decrease year-on-year. The group posted a total of EUR 673.4 million in consolidated gross written premium, up 7% compared to the same period in 2019, said insurer Zavarovalnica Triglav on Tuesday.

The group's net revenue earned from insurance premiums increased by 7% to EUR 523.1 million. The group generated EUR 40.6 million in profit before tax, 3% down year-on-year.

Net underwriting expenses amounted to EUR 338.3 million, up 2% compared to the first half of 2019. Average premium growth was meanwhile 4% in Slovenia and 8% in markets abroad. Growth was recorded in all three insurance segments; 17% increase in health insurance, 6% in non-life insurance and 3% in life and pension insurance.

"In the first half of the year, premium income recorded growth, whereas the generated profit was adversely affected by the deteriorating situation in global financial markets and partly by major CAT and other one-off events. The pandemic has radically changed the way we do business and we have adapted effectively to this situation," said chairman Andrej Slapar as quoted in the unaudited report.

Profit before tax from underwriting activities amounted to EUR 34.6 million, 3% up year-on-year, and the part earned from financial investments totalled EUR 5.3 million, a decrease of 17% year-on-year.

"Broken down by insurance segment, 85% of total profit (vs. 89% last year) was generated by the non-life insurance segment. In addition to good results from premium income, it was influenced by lower rates of return on investment and the creation of additional provisions."

The pandemic and its financial ramifications prompted a lower return on Triglav's investment portfolio worth EUR 3.3 billion. "Its value decreased by 5% in the first quarter of 2020, and at the end of the second quarter it returned to approximately the same value as at the end of 2019."

The volume of assets under management in the group's mutual funds decreased by 4% to EUR 979.4 million compared to the 2019 year-end, while discretionary mandate assets stayed roughly level at EUR 82.5 million.

Meanwhile, the consolidated gross written premium of Zavarovalnica Triglav grew by 4% to EUR 399.9 million and net revenue from premiums increased by 2% to EUR 283.2 million.

Profit before tax was down by 4% to EUR 31.6 million and net profit decreased by 4% as well to EUR 26.4 million. Net underwriting expenses were up by 3% to EUR 187.8 million.

Owing to the precarious situation in the financial markets, triggered by the pandemic, the group cannot make any sure projections on profit figures at the end of the year. According to Slapar, the profit before tax was planned between EUR 95 million and 105 million and based on the April assessment the annual profit before tax will likely decline by 10-25% compared to the planned figures.

The annual written premium and the combined ratio of the group are meanwhile forecast to be within the planned figures - around EUR 1.2 billion and below 95%, respectively.

Zavarovalnica Triglav supervisors also appointed Andrej Andoljšek chief supervisor today.

STA, 14 August 2020 - Speaking about a potential second nuclear reactor in Krško, Infrastructure Ministry State Secretary Blaž Košorok has told the STA that Slovenia is and will remain a nuclear country. Košorok, who is convinced Slovenia will need the reactor, called for a fact-based debate as opposed to politicking and appeals to emotions.

While the government recently placed a new nuclear reactor in Krško on the list of strategic projects for post-coronacrisis recovery, Košorok said this did not mean a final decision on the project had been made.

"We are talking about some kind of guidelines, but fact is that Slovenia is and will remain a nuclear country. We've been living with this for more than 40 years and will probably continue living with it," said Košorok.

The official, who described nuclear energy as a safe, reliable and long-term source of power, stressed that the 20-year extension of the life-span of what is currently Slovenia's sole nuclear reactor needs to be secured again first after a recent Administrative Court decision that entails a reinstalling of the original 40-year span ending in 2023.

Košorok is confident that the Environment Agency, which needs to okay the extension through an environmental impact assessment, has enough awareness about the importance of nuclear energy for Slovenia.

He stressed that securing the needed facilities for the storage of nuclear waste was a pre-condition for any decision. The investor, state-owned power utility Gen Energija, which manages Slovenia's half of the Krško nuclear power station, will have to be convicting with a serious investment plan and zoning procedures need to start.

Košorok added the investor will have to convince the asset manager, meaning the Slovenia Sovereign Holding, and key stakeholders, with the plan being that a decision on a second reactor be adopted until 2027 approximately.

Broad social consensus will be needed for a new reactor, especially in light of social and economic development, he added. He said some opposition is expected and normal while urging against politicking and for expertise-based debates.

He spoke of a fairly safe situation, pointing to the recent strong earthquake in nearby Zagreb that had no noteworthy effect on the Krško nuclear power plant whatsoever.

Košorok said it was too soon to speak about any technical details. There are a few interested parties, among them Westinghouse, which also built the existing reactor. Concrete decisions will be taken by experts, he added.

Interest in participation in the project was recently also expressed by Croatia, which co-owns the Krško nuclear power plant and has been cooperating with Slovenia in its management.

"There are ups and downs with any contract, a marriage is also a contract-based relationship that has good and bad moments. And I feel the good moments prevailed here," the official commented, welcoming Croatia's initiative while adding this was just one possible scenario.

The project has also drawn attention in other neighbouring countries, including Austria as a country traditionally opposed to nuclear energy. Talks were conducted as the life-span of the current reactor was being extended and Košorok said there had been "no dramatic opposition".

Meanwhile, the official also reflected on other potential energy projects in the country, highlighting the untapped potential in the Central Sava Valley, which he said could accommodate 10 hydro power plants. He said zoning and spatial planing should start immediately.

He moreover lamented the slow progress it the use of wind energy, saying Slovenia was unfortunately at the very tail end in this respect in the EU.

Košorok has a long track record in the energy industry. He headed the state-owned power utility HSE between 2012 and 2016, having before that spent seven years at the helm of the Ljubljana co-generation plant TE-TOL.

More on nuclear power and Slovenia

STA, 13 August 2020 - The relevant national inspection service has carried out a total of 139 building permit checks for buildings under construction this year to find out in the 70 cases that have been closed that 25 of them have no adequate permits or do not meet the required conditions.

Out of these 25, twenty buildings were being built illegally, three did not meet the required conditions and two facilities posed a risk, the Construction, Surveying and Housing Inspection Service said in a press release on Thursday.

The inspections were carried out between February and July and a total of 70 cases were closed by 4 August.

For the 20 illegally build buildings, the inspection has ordered that construction be suspended and set deadlines for their removal.

A ban on the use of the dangerous buildings has been issued, as well as orders for their removal, while for the buildings that do not meet the required conditions decrees ordering the investors to eliminate the deficiencies have been issued.

"We are still noticing that the share of detected illegal builds during targeted regular inspections on the ground (without reports or initiatives) is extremely high," the inspection service said, adding that compared to the previous years the situation has not improved.

STA, 13 August 2020 - Foreign direct investment in Slovenia increased by EUR 552 million in the first half of 2020, a significantly slower rate of increase than in the same period last year, when inbound investment rose by almost EUR 639 million. In the 12 months until the end of June, FDI was up EUR 725.7 million.

According to data released by Banka Slovenije on Thursday, EUR 370.7 million of the increase in the first half of 2020 was accounted for by reinvested profit, EUR 116.7 million by an increase in debt instruments and EUR 64.5 million by equity.

Domestic direct investment abroad meanwhile rose by EUR 222.7 million in the first six months, after it was up EUR 67.4 million in the same period last year. The net decrease in direct investment in the first six months was thus EUR 329.2 million.

Gross foreign debt stood at EUR 48.1 billion in June, a EUR 4.4 billion increase on a year ago. Debt increased the most for the state, by EUR 3.7 billion, and the central bank, by EUR 1.3 billion, while other sectors reduced debt by EUR 0.9 billion.

Net foreign debt amounted to EUR 300 million, a EUR 2.3 billion decrease, the state being the only net debtor in June with a debt of EUR 19.1 billion.

The current account surplus stood at EUR 1.4 billion in the first six months, down EUR 106 million on the same period last year.

The surplus in the trade of goods increased by EUR 236 million to EUR 1.085 billion. Exports decreased by 13.5% and imports by 15.7%. The surplus in the trade of services was down by EUR 400 million to EUR 933 million - the central bank attributes this to issues with travel due to the coronacrisis.

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