The Management Board of AD Plastik Group has signed a new Collective Agreement for 2022, pursuant to which the existing social and material rights of employees of AD Plastik d.d. have been retained at a high level. The agreement has been concluded for a period of one year and applies to all employees in Croatia.

Employees are undoubtedly the most important stakeholders of the company and the basic premise of its successful development, and in exceptionally challenging circumstances, additional mutual understanding and responsibility have been shown.

Given the extraordinary circumstances and the Russian-Ukrainian crisis, increased public interest in the company’s business operations is expected, so hereby we would like to inform our stakeholders about the current situation.

AD Plastik Group has two factories in Russia in which it generates about 25 percent of its revenue, and which produce components exclusively for the Russian market. Current circumstances complicate their business operations and the negative effects are evident, primarily through a significant weakening of the Russian ruble exchange rate, disruptions in the supply chain and the announcements of a temporary shutdown of some of the main customers in the Russian market. Cash flows from Russia to the parent company are not a significant business item, and the liquidity of the parent company, including available unused credit lines, is more than satisfactory.

It is very difficult to predict the final impact on a company’s economic activities and operations due to a range of uncertainties and unanswered questions. However, despite the circumstances, the stability of AD Plastik Group’s business operations is not endangered. Development of the situation is being monitored, various action scenarios have been developed and care is being taken on a daily basis to minimize risks and consequences. While in Russia the business is adapting to the new circumstances, in the European market the production processes are running smoothly and in accordance with the business plans, as well as commercial activities related to sealing new deals. “The situation is extremely demanding and uncertain, but AD Plastik Group is a stable company that has proven its resilience several times in history. We have shown that also in the pandemic, and I believe it will be the same now. We are aware that the period ahead of us is not an easy one, but the automotive industry needs to be considered in the long run. We are currently focused on reducing the impact of the crisis on business, maintaining sustainability and financial stability. At the same time, the realization of our projects in the European market is in progress, we have been working intensively on the development and expansion of the product portfolio and we are discussing new deals. We are ready for various scenarios that may require difficult decisions, but we are confident in the survival of AD Plastik Group,” said the President of the Management Board Marinko Došen.

The unaudited financial statement of the AD Plastik Group for 2021 has been published, the year in which the global crisis with the lack of semiconductors had the greatest impact on business. The Group’s operating revenue decreased by 6.8 percent compared to 2020 and amounted to HRK 1.14 billion. EBITDA amounted to HRK 123.64 million and was lower by 25.5 percent, while net profit was lower by 52.7 percent, amounting to HRK 22.21 million.

“Although the very beginning of the year showed positive signs and pointed to recovery of the market, the global crisis with the lack of semiconductors significantly affected the sales of new cars. Namely, due to the crisis, car manufacturers failed to meet the needs of the market and deliver the required quantities. Disruptions in production processes have affected the entire supply chain of the automotive industry, including our business. Unlike production, sales and project activities proceeded unhindered, so in 2021 we sealed new deals worth more than EUR 150 million. We have also contracted several very important development projects, thus strengthening our position as a development supplier,” said the President of the Management Board of AD Plastik Group Marinko Došen.

In addition to disruptions in the supply chain, last year was marked also by a significant increase in the prices of materials, raw materials, transport and energy sources. By open price calculation and alignment with most of its customers, the impact on Group’s business has been reduced. While reduced production and a shortage of vehicles affected the expected trends in the number of newly registered cars in the European market, at the same time movements in the Russian market were more favorable. AD Plastik Group thus achieved revenue growth of 13 percent in Russia in 2021. “The development activities of car manufacturers are in full swing and the entire industry has been actively preparing for the end of the crisis and a new rise. Although a very demanding period is ahead of us and there is no room for relaxation, I am sure that we will successfully cope with this rather difficult crisis. We are ready for new challenges, as well as for the better, brighter and more sustainable future of the automotive industry, which will surely come,” said Marinko Došen.

The HRIO awards, given for the fourteenth year in a row by the Croatian Business Council for Sustainable Development (HR BCSD) and the Croatian Chamber of Economy, were solemnly presented at the annual Sustainable Development Conference. AD Plastik is the winner of the HRIO award in the category of large companies, which was accepted on behalf of the company by the President of the Management Board Marinko Došen.

“Sustainable business nowadays is the responsibility of every company, regardless of business operations, size, or geographic affiliation. It is our duty to live in harmony with our environment and preserve this planet for future generations. We are happy that our efforts and progress have been recognized by the professional public and although sustainable business is an integral part of our corporate culture, we are aware that we are at the very beginning. Sustainable business is an ongoing process that we must live every day and it must be woven into all segments of the business. It is the only way to succeed and survive in the modern market. Each award is a pleasure for us and in a way a confirmation of successful work, but above all, it is an additional obligation and motivation for an even better future,” said Marinko Došen, President of the Management Board of AD Plastik.

The Croatian Sustainability Index (HRIO) is a methodology that provides a comprehensive insight into the sustainability of business practices, compliance with the latest provisions of the European Union, and comparison with the practices of other Croatian companies. Activities in six areas are evaluated, and this rating measures the level of sustainability of companies in Croatia. The awards are given once a year, and more than a hundred companies participate in the evaluation. It is a practice by which a company integrates sustainable development into the decision-making system to a greater extent than prescribed by legislation and thus manages the impact of its business on the environment and society. In order to be in line with the latest European directives and standards, global ratings, and Sustainable Development Goals, the former CSR Index has been upgraded and modernized and changed its name to the Croatian Sustainability Index – HRIO.

The financial statement of the AD Plastik Group for the first nine months of 2021 has been published, which shows the impact of the global semiconductors crisis on the company’s business operations. The Group’s operating revenue decreased by 1.3 percent, compared to the same period last year, amounting to HRK 830.51 million. EBITDA was lower by 10.3 percent and amounted to HRK 97.49 million, and net profit amounted to HRK 22.97 million, being lower by 3.5 percent.

“Although expectations and plans were more optimistic, it is clear that the crisis has more far-reaching consequences than the first announcements. Most car manufacturers, due to the lack of semiconductors, have been forced to significantly reduce their production plans in the past period. Since our factories follow the operational plans of their customers, as a consequence, our business results for the first nine months are worse than expected. The automotive industry has been facing major challenges in the global market, but it is important to stress out the fact that the demand for cars has been constantly growing. In recent months this hasn’t been followed by the numbers of newly registered cars, but the reason for this is solely the lack of cars due to production downtime caused by insufficient delivery of semiconductors, ” said Marinko Došen, President of the Management Board of AD Plastik Group.

AD Plastik Group has been adjusting its business to the market situation and although the semiconductors crisis is also noticeable in the Russian market, the Group’s Russian factories achieved revenue growth of more than 25 percent in the first nine months.

In the reporting period, AD Plastik Group sealed new deals worth EUR 104 million in the European and Russian markets, and continues its development and commercial activities without hindrance. Most of the deals were sealed in the European market, namely EUR 79.9 million of new deals for the Stellantis Group and EUR 24.1 million in the Russian market for AvtoVAZ, Nissan and the Volkswagen Group.

„A very demanding period is ahead of us and despite the market uncertainties to which we have no influence, our mission is clear. We are confident in the future of the automotive industry and our company, and we focus our activities on preserving financial stability and adjusting business to our customers and the market situation. Although it is difficult to predict the course of events, the end of the crisis is certain. It will surely be a generator of accelerated growth and development of the automotive industry as a whole, thus of AD Plastik Group as well, “ said Marinko Došen. 

As part of the sixteenth Convention of Croatian Exporters, the Golden Key awards ceremony for the best Croatian exporters was held. This year too AD Plastik received the Golden Key award in the category The Best Exporter to Slovenia in 2020, and was nominated in two other categories, namely in the category The Best Exporter to Romania and in the category The Most Innovative Exporter.

The award was received on behalf of the company by the Finance Director Josip Divić, who stated on that occasion: “It is a great pleasure and honor for me to receive this award, especially because it is awarded for our results in quite difficult times. This award is the result of teamwork and that is why I thank first and foremost all the employees of our company for their dedication and contribution in these challenging circumstances. I would also like to thank our long-term partner, the company Revoz, which recognizes our values, quality and reliability. Although we are witnessing numerous challenges in the market, we are optimistic about the years ahead and we expect the continuation of our strong exports to Slovenia, but also an increase in exports to other European countries.”

The financial statement of AD Plastik Group for the first six months of 2021, which confirms the growth of indicators despite the challenges in the global market, has been published. The Group’s operating revenue increased by 13.4 percent compared to the same period last year and amounted to HRK 622.43 million. EBITDA grew by 9.3 percent and amounted to HRK 82.50 million, while net profit amounted to HRK 32.43 million, representing an increase of 87.4 percent.

“The consequences of the pandemic and shortage of semiconductors in the market have slowed down the production of new cars in Europe, so we have been adapting our operational plans to customers. At the same time, the Russian market has been currently recovering faster and the consequences of the semiconductor shortage have not been observed there, so, accordingly, our factories are recording a more significant increase than the European ones. We have a stable financial position and we have been working smoothly on the development activities for about forty previously contracted projects for the European and Russian markets. Along with all the challenges and uncertainties, there is a slight but confident shift towards market recovery. Unfortunately, the pandemic is still present, therefore further caution is necessary. We monitor global trends and adjust our business, and we are focused on achieving our goals for this year,” said the President of the Management Board of AD Plastik Group, Marinko Došen.

Strong revenue growth in the Russian market and the movement of Russian ruble and Hungarian forint exchange rates had a positive impact on the Group’s results, while the lack of semiconductors in the European market prevented a significat indicators increase in the parent company.

In the reporting period, AD Plastik Group sealed new deals worth EUR 104 million and reduced its financial debt. Most of the deals were sealed in the European market, namely EUR 79.9 million of them for the Stellantis Group and EUR 24.1 million in the Russian market for AvtoVAZ, Nissan and the Volkswagen Group.

„Sealed deals in our portfolio provide us with a secure perspective, while a stable financial position and quality allow us to face current challenges more easily. The pandemic is still ongoing, so the uncertainty of its development and the lack of semiconductors complicate business operations and planning. Therefore, caution is necessary and our focus on risk management is still strengthened. Although this is another challenging year, we believe that the end of the crisis will be a new and big driver for the AD Plastik Group and the automotive industry as a whole. Our current plans and realization are adapted to the circumstances, and we are ready for the rapid changes and adjustments that the future brings,“ said Marinko Došen.

As of today, AD Plastik is a proud holder of the “Health Friendly Company” certificate awarded by the Ministry of Health and the Croatian Institute of Public Health within the National Programme “Healthy Living“.

Dinka Nakić, Head of the Department for Coordination of Activities for the Promotion and Preservation of Lifelong Health of the Croatian Institute of Public Health, presented the certificate to the Executive Director of Human Resources and Business Organization of AD Plastik Group, Mira Pavić. “The safety and health of employees have always been the highest priority of our company, and this was especially evident during the pandemic. We focus our internal activities on promoting a healthy business environment and adopting healthy habits in general. It is an added value for our employees, but also for the company as a whole. Satisfied and happy employees are our ultimate goal,” said Mira Pavić.

The “Health Friendly Company” is part of the Health and Workplace component within the Programme “Healthy Living”, and is aimed at employees and the promotion of healthy life habits as well as the improvement of health in the workplace. The assessment of the working environment within companies is carried out by the Croatian Institute of Public Health in seven key areas: nutrition, promotion of physical activity, protection of employee health in the workplace, smoking ban, ban on alcohol consumption, environmental regulation and employee health protection.

The label “Health Friendly Company” is held by the companies that recognize healthy values and care about improving the health of their employees, and AD Plastik is officially among them as of today. The certificate is awarded for two years, and before its renewal, the condition is re-evaluated.

The Russian shareholder AO Holding Avtokomponenty made a donation in the amount of one million kuna to AD Plastik Group for operating in the difficult conditions of the COVID-19 virus pandemic.

This is a support and reward for employees for exceptional effort and work during the economically and socially difficult and demanding 2020.

“I believe that this donation will be an additional motive for our employees for further progress and development. Our employees are truly our greatest value and we are especially happy when our shareholders recognize this as well. This is certainly an additional incentive for all of us to persevere on our path and be even better, despite the challenging circumstances ” said the President of the Management Board Marinko Došen.

The just published financial results of AD Plastik Group for the first quarter of 2021 are expected and they confirm the financial stability and profitability of the company in the very demanding and challenging circumstances of the corona crisis.

Operating revenue amounted to HRK 327.21 million, EBITDA amounted to HRK 52.32 million, and net profit amounted to HRK 25.84 million at the Group level.

All indicators decreased compared to the first quarter of last year, but it should be noted that the company in the first quarter of 2020 continued to record revenue growth, despite the onset of the pandemic and a significant decline in the automotive market.

“In the first two months of 2020, our factories achieved record results, and the beginning of the pandemic and the consequences it caused unexpectedly changed the situation. Nevertheless, we ended the first quarter of 2020 with revenue growth, which was also contributed by one-time positive impacts in that period, so we can say that this was almost the last pre-pandemic reporting period. Although the automotive industry, like the global economy as a whole, has been facing a number of challenges and uncertainties, moderate positive market indicators are evident. Our risk management strategy through market dispersion has proven to be effective, which is evident also in our results. The Russian car market was the least affected by the crisis, so our factories in Russia recorded revenue growth of 15.5 percent in this period,” said the President of the Management Board of AD Plastik Group, Marinko Došen.

The markets in which the company operates show signs of a moderate recovery regarding the number of newly registered vehicles, which was evident in the results of the previous quarter, although the production of new vehicles in the European market has been somewhat slowed due to the shortages of semiconductors. Like the global economy as a whole, the automotive industry has been facing the consequences of the crisis, and market stabilization is expected in the second half of the year. The price of the ADPL share increased by 13.8 percent in the first quarter, compared to the end of last year, and a dividend from retained earnings of HRK 8 was paid in March.

“We have preserved financial stability, which allows us to deal more easily with the consequences of the crisis, and in addition to protecting the health and safety of employees, this is our primary goal also in the coming period. We monitor trends and influences in the market and adequately adapt to them, and we have strengthened our position as a quality and reliable partner. We continue our development and sales activities uninterruptedly, and 43 previously contracted projects in the European and Russian markets are currently ongoing. New deals are also being sealed, by which our portfolio of future deals offers a stable and secure perspective. We have adapted our plans to the circumstances, so our goals for 2021 are more conservative, but I believe they are achievable,” said Marinko Došen.