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Retailer Mercator's new boss warns on profit-paper
June 5, 2012 / 7:52 AM / in 5 years

Retailer Mercator's new boss warns on profit-paper

LJUBLJANA, June 5 (Reuters) - Slovenia’s largest food retailer Mercator could post sales and net profit this year lower than planned, Toni Balazic, the new chief executive of the company, told daily newspaper Finance in an interview published on Tuesday.

Mercator had said in January it expected net profit of 15.7 million euros ($19.6 million) this year, down from 23.5 million in 2011 due to slower sales growth and declining margins, on sales of 3 billion euros.

“I am studying the plans. The old management has fallen behind them therefore they need to be revised precisely,” said Balazic, who took over as the head of Mercator on June 1 after his predecessor Ziga Debeljak resigned in March.

Mercator told Reuters on Tuesday it was not able to say when the revision of the plans will be completed.

Debeljak resigned over disagreements with Mercator’s owners, which include local banks and investment companies, who wanted to sell the retailer to Croatian rival Agrokor. The deal did not go ahead because Mercator’s management refused to allow Agrokor to carry out due diligence.

Balazic did not say in the interview whether he would open Mercator’s books to Agrokor which is expected to renew its bid later this year, saying he would answer that when it happens.

Agrokor was reported to have offered 221 euros per Mercator’s share last year, valuing the whole company at 832 million euros.

Shares of Mercator closed 4 percent higher at 130 euros on Monday while the blue-chip SBI index gained 1.29 percent. ($1 = 0.8003 euros) (Reporting By Marja Novak. Editing by Jane Merriman)

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