News 22. 12. 2017

The Government of the Republic of Slovenia grants its consent to Asset Management Annual Plan 2018 and to SOEs Performance Criteria

At its session of 21 December 2017, the Government of the Republic of Slovenia granted its consent to the Asset Management Annual Plan 2018 ("AMAP") and to the SOEs Performance Criteria ("Performance Criteria").

The said AMAP defines detailed goals SSH has in the management of assets owned by SSH and of assets owned by the Republic of Slovenia ("RS") but managed by SSH. It is composed of two sections, the General Section which is of a public nature, and the Special Section which presents a plan for asset management for each asset separately. Such plan defines in detail asset management goals and key criteria for measuring the performance in attaining the management objectives, in addition to presenting policies and specific measures for these activities. 

The AMAP also states the expected cash flows arising from the management of capital assets.

In terms of its content, the Performance Criteria in which criteria (ratios) are defined for measuring the performance of SOEs, is a document linked to AMAP.

Further growth is expected in the average weighted ROE of the portfolio of companies under SSH's management.

The first estimates in regard to the operations of companies under SSH's management show that the average weighted ROE of these companies will achieve 6% in 2017, thus significantly exceeding the ROE planned which stood at 5.2 %. Notwithstanding the above stated, the SSH's plan for 2018 envisages further growth in the profitability of the portfolio of assets under SSH's management: it is expected to amount to 6.1%.

The rate of return planned for 2018 is lower than the target rate of return determined in the Strategy but it is worth pointing out that the RS's portfolio includes two thirds of strategic assets whose priority is the attainment of strategic goals, that is, the realisation of various important social interests and not solely economic goals. The attainment of strategic goals and economic goals is, however, often mutually exclusive which hampers the attainment of higher profitability arising from the state capital assets portfolio.

This is illustrated by specific data: the portfolio of assets in industries in which a great share of strategic assets is included (for example, the energy sector with the ROE estimate for 2017 moving around 3.2%) achieves lower rates of return on equity on average, as compared to industries in which a great share of portfolio assets is included (for example, the sector of economy with the ROE 2017 being estimated to stand at 6.3%).

SSH therefore believes that, in the future, it makes sense to set the methodology for determining the target return on equity of assets (ROE) - being one of the key goals of asset management - by individual groups of assets, for example, by industry/by pillar or by the classification of assets, either in the State Assets Management Strategy or in another legal document. 

Regardless of the record-hitting dividends paid out by companies under SSH's management, further growth in cash flows arising from dividends is expected for 2018

SSH supports the development and efficiency of operations of the portfolio companies, and, by means of its decisions made at AGMs of these companies, SSH pursues a responsible approach to the dividend policy in terms of advocating a suitable balance between dividends and development needs of companies. Notwithstanding the 2017 record-hitting dividends paid out by companies under SSH's management (RS received the total of EUR 212,1 million whereas EUR 45.9 million was paid to SSH, totalling EUR 258 million of dividend pay-outs), further growth in dividend pay-outs is expected in 2018.

In 2018, in line with expectations stated in AMAP, RS is expected to receive EUR  246.1 million of dividend revenue while EUR 47.7 million of dividends is expected to be paid out to SSH from capital assets held by SSH; the total of EUR 293.8 million is thus expected, which is 14% more than in the preceding year. Taking into account the transfer of some assets from SSH to RS at the end of 2017, the distribution of the expected dividend revenue between RS and SSH is about to change slightly, although the total amount in dividend pay-outs for RS and SSH will stay the same.

Sale of SOEs in 2016

An indicative review of state-owned enterprises for which activities have been planned to be taken in 2018 aiming at their sale is presented below.



RS ownership stake (%)

SSH ownership stake (%)



















HIT, D.D.**









KDD D.D.***



M1, D.D.****













* Ownership stakes are presented according to the situation as of 30 September 2017.

**Amendments to the Gaming Act are necessary to be undertaken prior to the launch of any sales activities.

***The Sale and Purchase Agreement has been concluded which will be realized after conditions precedent are satisfied.

****Shareholdings are rounded up to two decimal places.


In 2018, activities in connection with the sale of capital assets will continue for all remaining capital assets held by RS and SSH, which are classified under the group of portfolio assets, when, subject to the following circumstances - operations of these companies, market conditions and business environment and other factors - it is assessed that it is reasonable to launch the above mentioned activities.

Up until now, 9 companies were sold out of 15 companies stated on the list of assets which had been granted the Parliament's consent for their sale. In respect of the said list and activities pursued in 2018, SSH plans to execute the sale of shares of Unior, d. d., whereas the decision to renew the process for the sale of Cinkarna Celje, d. d., and Telekom, d. d., will be made in consideration of the circumstances and factors mentioned above.

In 2018, SSH will reopen the process for the sale of NLB, d. d., if and when RS, acting as the sole shareholder of the said bank, accepts the decision to carry out the sale process.

Activities planned for 2018 also include the sale of Abanka shares, and continued activities for the swap and sale of shareholdings in Geoplin, d. o. o., and Plinhold, d. o. o.

Other goals to be achieved in 2018 in connection with asset management

In addition to efforts to achieve economic and financial goals and strategic goals of companies with capital assets of the State, along with ongoing endeavours for transparent, competitive and efficient running of processes for the sale of companies with capital assets, the future focus will be placed on the following features: the quality of corporate governance, the transparency and compliance of operations of companies under management, the support for corporate transformation of companies and the attainment of set goals. SSSH regularly strives to improve the quality and analytical value of information system platforms necessary for the effective management of capital assets. In this regard, SSH will strive to further improve reporting due by SOEs to SSH with the aim of achieving the standards applicable for listed companies. Such reporting will include the preparation of monthly plans accompanied by monthly reporting due by SOEs to SSH. SSH will dedicate special attention to upgrading one of the key tools for the management of SSH, that is the monitoring and benchmarking of key performance indicators obtained by individual companies in the portfolio against relevant competitive companies, by way of which a more active and more efficient management of capital assets will be enabled. The attainment of ambitious goals and the maintenance of competitiveness of numerous companies will not be possible only by implementing gradual changes but a decisive transformation will be needed  at all levels of an organization in terms of strategies, business models, organisation, processes and personnel Thus, SSH will verify the strategies of selected companies and strive to introduce the practice of systemically reviewing risks which is expected to be carried out in the most important companies (this practice has already been introduced in the energy sector). It will continue to provide support to all portfolio companies to tackle changed condition for operations in an effective manner and to ensure long-term growth and employment.


Asset Management Annual Plan 2018 (general section of the plan)

SOEs Performance Criteria (available only in Slovene)

Back to all news