Business

29 May 2020, 18:07 PM

STA, 29 May 2020 - The total value of real estate transactions in Slovenia reached a record level last year, estimated at EUR 2.7 billion, as prices continued to grow, albeit at a slower pace than in 2018, shows a report from the Surveying and Mapping Authority (GURS).

GURS, which notes that the record amount should be attributed to several sell-and-lease-back contracts for shopping centres, says in the report that real estate prices exceeded the previous peak in 2008.

According to preliminary data, around 35,500 transactions were recorded last year with their total value approaching EUR 2.7 billion. It is expected that the final number will exceed 36,000 and their total value to stand at EUR 2.7 billion.

This will be the highest annual amount since real estate transactions started to be systematically recorded in 2007.

"Compared to 2015, the number of transactions with real estate was up by more than 20%, while their total value increased by almost 60%," shows the 2019 report.

The record value is attributed to a steep rise in the value of transactions with commercial real estate, which exceeded half a billion euro. Its share in the total value, which usually stands around 10%, was up to more than 20%.

The value of transactions involving residential real estate was up by 10% compared to 2018 to EUR 1.59 billion, of which transactions with apartments amounted to EUR 951 million. The number of transactions was up by 1% to around 10,750.

The number of transactions with second-hand apartments was up by 1.5% to 10,160, while the number of new apartments sold was down by a third to 600. This is well below the annual average for the 2015-2017 period of more than 1,000.

"The number of new apartments which entered the market in 2019 was not even close to sufficient, and a majority of new apartments which will satisfy the demand is expected to built by the end of 2021," the report adds.

Growth of the prices of second-hand apartments slowed down last year, with the average price per square metre standing at EUR 1,850, which is nevertheless 5% more than in 2018, and 28% more than in 2015, when the trend reversed.

In Ljubljana, where the prices of apartments were the highest for the last three years, exceeding the previous peak in 2018, the average price of a square metre in a second-hand apartment was EUR 2,800, up 1% year-on-year.

The average price of a house was EUR 128,000, or 3% less than in 2018 and 19% more than in 2015. Considering the features of houses sold, GURS has estimated that their prices at the national level have increased by 15-20% since 2015.

GURS notes that this year, the real estate market will be significantly affected by the coronavirus epidemic, during which "transaction stopped and it is clear that the 2019 trends are history."

27 May 2020, 12:22 PM

At least 500 cultural workers – with the organisers claiming up to 1,000 – gathered in front of the Museum of Contemporary Arts and Ethnographic Museum in Ljubljana this Tuesday to protest against the alleged lack of responsiveness on the part of the Ministry of Culture amid the coronavirus lockdown. Specifically, they protested the end of support for the sector, and the lack of a comprehensive strategy to preserve and promote Slovenian culture, as many other European countries have.

The protesters expressed their dissatisfaction with the Ministry's work by marching in front of its headquarters, where they covered the Ministry's large windows with printed appeals of cultural organisations and individuals.

Related: Cultural Workers Critical of Govt Covid Support

Cultural workers are suffering from the shutdown of all private venues, and thus a loss income from cinemas, concert halls, theatres and so on, as well as the ending of coronavirus aid for the self-employed, while those who usually receive support from the state – publishers, performers and the like – are also under increasing financial pressure.

Some 100,000 people work in the sector, and the organisers of the protest highlighted the fact that the nation’s culture has a significant multiplier effect on the economy, as well as playing a role in diplomacy and soft power.

27 May 2020, 11:51 AM

A reminder that the deadline for the basic income and exemption from contributions is approaching, with June 1st 2020 being the last date self-employed residents whose 2020 income will fall – or is expected to fall – at least 10% compared to 2019 can submit a statement on e-Davki.

Details on how to claim the “corona aid” can be found here.

The next and the final basic income transfer will be on June 10, 2020.

26 May 2020, 20:40 PM

The Financial Administration of the Republic of Slovenia (FURS) reminds taxpayers that the deadline for filling their 2019 tax report is fast approaching.

Due to COVID 19 pandemic, the deadline was extended from March 31st to May 31st this year.

However, since May 31st 2020 is on Sunday, the last day to submit tax reports is in fact June 1st.

Furthermore, taxpayers are required to pay their tax obligations within a 30 day deadline from the submission of their tax return. If they submit their tax return on June 1st, then any eventual tax liabilities must be paid by July 1st at the latest.

26 May 2020, 14:05 PM

STA, 25 May 2020 - The government is not supporting a legislative motion proposing to keep shops closed on Sundays and work-free days even after the end of the coronavirus epidemic. The opposition Left-sponsored bill is currently not appropriate to be discussed in parliament due to the economic fallout of the Covid-19 crisis, said the government on Monday.

Given the economic ramifications of the epidemic, including those affecting commercial activity which accounts for more than 30% of all the revenue of Slovenia's economy, the proposal does not enjoy the government support.

Moreover, the government thinks that social dialogue is the most appropriate way of tackling such issues, said the government's communication office after today's correspondence session.

The bill is so important that it should be also discussed at a session of the Economic and Social Council's, believes the government.

After the Left made the proposal in late April, the party expressed the hope that the bill could be passed by summer considering support expressed from both sides of the political aisle and part of the public.

The Left drafted amendments to the trade act in response to a call by the Trade Union of Shop Assistants in its Labour Day message to keep stores closed on Sundays and public holidays beyond the epidemic with some exceptions.

When the party presented the proposal, ahead of the May Day holidays, Prime Minister Janez Janša expressed support for the idea on Twitter.

Meanwhile, the management of the Slovenian Chamber of Commerce (TZS) strongly opposed the proposal
last week, saying that consumption should be encouraged in such extreme circumstances to boost the economy and measures to preserve jobs should be adopted.

26 May 2020, 14:01 PM

STA, 25 May 2020 - The NLB bank will carry on with optimising its business network by closing ten offices across Slovenia on 15 June. The Mislinja municipality in northern Slovenia, one of the places that will experience the closure first-hand, has protested against the step.

The bank has been citing changed clients' habits and the rise of online and mobile banking as reasons for closing physical offices. During the coronavirus epidemic, digital banking services became even more popular.

NLB believes that such habits will have a long-term impact on bank visits, with people being less likely to frequent the actual offices.

The bank has already started notifying the clients as well as local communities of the step, NLB has told the STA, adding that other offices will step in if needed or a team of mobile bankers will conduct home visits.

Moreover, a NLB mobile office will keep paying visits across the country until the end of the year. The bank also highlighted that its ATMs will remain in places where the offices will be shut down.

The Mislinja community is strongly opposing the closure since the NLB office is the only bank office in the municipality. The locals are up in arms, Mislinja Mayor Bojan Borovnik told the STA, pointing out that the elderly required the vicinity of the office in particular.

Borovnik hopes that the bank's decision is not final. He is also looking into the possibility of another bank opening up an office there.

The Mislinja office was temporarily closed during the epidemic. The bank recently notified the municipality of its permanent closure.

The Koroška regional council has addressed a letter to the bank, protesting over the move and urging NLB not only to keep the office open but also to reopen a couple of offices in northern Slovenia.

Meanwhile, today the bank reopened twelve offices across Slovenia in the wake of a major easing of coronavirus restrictions.

25 May 2020, 11:24 AM

STA, 24 May 2020 - Telecoms incumbent Telekom Slovenije is to set up a test network featuring 5G technology at port operator Luka Koper to explore development options and test various logistics solutions. The project is co-financed from Horizon 2020, the EU's key 2014-2020 research and innovation multi-billion fund.

The 5G infrastructure is planned to offer not only communication services but also a number of virtual networks intended for individual business verticals, such as logistics, transport, health, energy, production facilities, smart cities and communities, Telekom Slovenije has announced.

Luka Koper will use the latest-generation wireless technology to test safety solutions as well as for process optimisation and environmental protection.

Since it enables faster transfer of larger quantities of data, the new technology should help improve control of safety and transshipment.

It should also facilitate electricity consumption control in a bid to improve energy efficiency.

Similar solutions are also to be tested in the German and Greek ports of Hamburg and Piraeus, respectively.

The Luka Koper-Telekom Slovenije project is part of 5G-Loginnov, a EU's development project focusing on 5G mobile technology to bring innovative solutions in logistics.

5G-Loginnov is co-financed by the European Commission's Horizon 2020 programme and brings together 15 partners from several European countries.

Among the Slovenian partners are Luka Koper, Telekom Slovenije and the Internet Institute from Ljubljana.

The 15 5G-Loginnov partners will invest almost EUR 8 million in the three-year project, to be completed in September 2023, with the EU contributing another EUR 6 million.

Both Telekom Slovenije and Luka Koper are also involved in other European 5G technology projects.

25 May 2020, 11:21 AM

STA, 24 May 2020 - Bia Separations, a biotechnology company based in Ajdovščina, is to expand its production facilities in Ajdovščina and Italy's Gorizia. The company's investment plans to launch production in the US have been put on hold due to the coronavirus pandemic, however Bia Separations will go ahead with them as soon as possible.

The company, a world leader in the development of purification processes for biologics, in particular for gene therapy, will expand its production due to increased demand.

The European Medicines Agency has recently recommended granting a conditional marketing authorisation in the EU for a gene therapy medication used to treat spinal muscular atrophy. Helping produce the medication, Bia Separations will have to step up its production capacities.

Related: Biotech Firm Bia Separations Biotech Expands in Slovenia, US & Canada

Moreover, a major investment project planned for the US, the company's main market, will be realised as quickly as possible, Aleš Štrancar, Bia Separations CEO, has told the STA.

The investment has been delayed for at least a few months due to extreme circumstances and air travel restrictions, however there is still plenty of time for its realisation since a production facility in the US is planned to be completed by the end of 2023.

Meanwhile, efforts to expand production in Ajdovščina are underway.

"When one of the projects aiming to find a vaccine for the novel coronavirus is green-lit, the company will most probably have to quickly increase its production capacities," said Štrancar, adding that Ajdovščina was an ideal place to enable such a swift expansion.

Most of Bia Separations's customers come from the US and they strive to secure the potential vaccine for US citizens first. The company is part of quite a few such efforts and estimates that at least one of them will be successful.

Moreover, the company is cooperating with a couple of European partners taking part in the race to find the vaccine and is also part of a Slovenian effort.

An investment project in Gorizia has been launched as well with construction works expected to start next year. The company's new programme is to be developed there.

Bia Separations currently helps eight companies with developing the coronavirus vaccine. The company provides purification processes for potential vaccines or medications and assistance in setting up production lines, but it does not actually work on developing vaccines or medications, said Štrancar.

22 May 2020, 13:47 PM

STA, 22 May 2020 - The energy group Petrol saw its sales revenue drop by 15% year on year to EUR 916 million in the first quarter, due to lower prices and a drop in the sale of petroleum products. Still, net profit of the group was up 20% to EUR 21.8 million, shows a report published on the website of the Ljubljana Stock Exchange.

Gross profit stood at EUR 105.3 million, which is on a par with the first three months of 2019.

Earnings before interest, taxes, depreciation and amortisation (EBITDA) were up 26% to EUR 46.5 million, mostly due to the balancing out of petroleum product price quotes, as diesel price quotes for the coming months at the beginning of the year were twice as high as at the end of March.

Excluding this effect, EBITDA for the period would be up just 2% to EUR 37.9 million, shows the report that was discussed by the supervisory board on Thursday.

"In March, the business environment deteriorated considerably as the pandemic began. Petrol Group companies ... have implemented the necessary measures to contain the spread of the virus and ensure uninterrupted energy-product supply," the group says, noting that no disruption in the energy-product supply had occurred though, and all points of sale had been operational.

The group generated 47% of its EBITDA through sales of petroleum products, 21% through sales of merchandise and related services, 18% through energy and environmental solutions, 12% through the sale of other energy products (natural gas, electricity, LPG), and 2% through renewable electricity production.

In the first three months of 2020, sales of petroleum products were down by 18% to 742,900 tonnes, mostly due to lower sales to the Agency for Commodity Reserves.

Some 43% of sales were generated on the Slovenian market, 24% in SE Europe, and 33% in EU markets.

At the end of March, the Petrol group's retail network consisted of 509 service stations, of which 318 were in Slovenia, 109 in Croatia, 42 in Bosnia-Herzegovina, 15 in Serbia, 15 in Montenegro and ten in Kosovo.

Sales revenue of merchandise and related services were down by 35% to EUR 127 million in the January-March period, and the sales of natural gas was up 15% to 6.4 TWh.

Because of the epidemic, the group's targets for 2020 will not be met and Petrol has prepared different scenarios for its operations until the end of the year, depending on the severity of the crisis.

If certain restrictions on transit traffic and tourism still remain in place in the next few months, it expects this to have a major impact on its operations in the summer months. The group is also preparing for the possibility of major restrictions on movement to be introduced again in the final quarter.

The group thus expects the sale of petroleum products to reach 83-86% of the 2019 figure. EBITDA for 2020 could amount to 73-79% of the 2019 figure.

Before the pandemic, Petrol's plans for this year included sales revenue of EUR 6.4 billion, EBITDA of EUR 214.8 million and EUR 109.8 million in net profit. It also planned to sell 3.4 million tonnes of petroleum products.

Investments will be limited to the most essential this year and the management will make decisions on this based on the pandemic-related developments.

The group will focus on cost optimisation and streamlining of operations until the end of the year, while securing uninterrupted energy-product supply.

The supervisory board assessed that the management had responded to the pandemic appropriately and has the situation under control.

An AGM has been scheduled for 23 July.

21 May 2020, 10:36 AM

STA, 20 May 2020 - The government adopted on Wednesday a new economic stimulus package, featuring subsidies for shortened working time, vouchers for citizens to be spent in tourism facilities around the country, and favourable liquidity loans. The package is worth around one billion euros.

Subsidies will be available to employers who cannot secure at least 90% of the usual workload for at least 10% of their employees and that the state would subsidise up to 20 hours weekly.

For workers on 20-hour weeks, the subsidy will amount to EUR 449, for 15 hours EUR 336, for ten EUR 224 and for five EUR 112.

Workers on the minimum wage will not receive the full minimum wage if they do not work full time, Kralj said, arguing a distinction needed to be preserved among those working full- and short-time.

The measure will be in place until 31 December and will be financed from the European Social Fund and the European Commission's SURE mechanism.

The stimulus package also includes an estimated EUR 345 million worth of vouchers to be spent in Slovenian tourism facilities. All Slovenian citizens will be eligible for vouchers, which will be available as of 1 June.

Related: Slovenia to Spend €345m on Tourism Vouchers for All

Minors will get EUR 50 vouchers and adults EUR 200 vouchers in electronic form, which may be used to pay for accommodation and breakfast in hotels, apartment complexes, camps, agritourism farms and other similar facilities.

The measure, valid until 31 December, will cost the state EUR 345 million, but visitors who cash in their vouchers are expected to spend an additional EUR 172 million for services they will not be able to cover with vouchers.

Also adopted is an extension of subsidies for temporary lay-offs only for certain industries. Companies in the tourism and hospitality industries whose estimated drop in revenue is more than 10% compared to 2019 will be eligible.

The new package also serves as legal basis for notification of state aid under the EU rules, based on which the Economy Ministry will draft a financial incentive programme intended for tourism and border problem areas.

In order to boost liquidity of companies, state-owned funds will provide EUR 40 million-worth of favourable liquidity loans for around 900 micro and small companies.

21 May 2020, 10:33 AM

STA, 21 May 2020 - Slovenia's pharma group Krka Group saw its net sales revenue increase by 22% year-on-year to EUR 462.9 million in the first quarter as the coronavirus pandemic pushed up the demand for its products. Net profit rose by 21% to EUR 85.2 million.

The unaudited interim report for the first quarter released by Krka on Thursday shows the operating profit rising by as much as of 85% year-on-year to EUR 133.9 million, and earnings before interest, taxes, depreciation and amortisation (EBITDA) increasing by 62% to EUR 162 million.

The group generated 95% of sales outside Slovenia, with East Europe, its biggest market, accounting for 33.2% of overall sales. The region also saw the highest sales growth in absolute terms, increasing by EUR 31 million to EUR 153.1 million, chiefly owing to growth in Russia and Ukraine.

In its second biggest market, Central Europe, Krka generated EUR 113.7 million or 24.6% of its overall sales, followed by South East Europe, at EUR 63.8 million (13.8%), and overseas markets, at EUR 13.5 million (2.9%).

Sales at home, at EUR 23.3 million, accounted for 5.1% of the overall sales. Prescription drugs accounted for EUR 10.8 million as their sales rose by 12% year-on-year.

The group allocated EUR 14.9 million for investment, of which EUR 9.8 million in the controlling company.

As of the end of March, the group had 11,622 regular employees, employing a total of 12,791 people along with agency workers. This is 21 more than at the end of 2019. This year the company plans to increase its headcount by 3%.

The core company, which employs 5,898, generated EUR 434.9 million in sales in January-March period, one third up year-on-year. Operating profit nearly doubled to EUR 126.2 million and EBITDA rose by 74% to EUR 147 million as net profit increased by 28% to EUR 65.4 million.

The company said the sales growth was partly affected by an increased demand for Krka products as a result of the novel coronavirus. "Towards the end of the first quarter, the demand slowed down and is currently at the planned and anticipated level."

Considering the unpredictability of the pandemic and its aftermath, the Krka management said it continued to carefully monitor the developments in the countries they operate in.

The group sales revenue for 2020 is projected at EUR 1.52 billion, of which 94% is to be generated in foreign markets. The profit target for the year is EUR 210 million, while EUR 134 million is to be allocated for investment this year.

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