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Publication of Annual Report of SSH and SSH Group for 2023
Publication of Annual Report of SSH and SSH Group for 2023
In 2023, the operations of Slovenian Sovereign Holding (SSH) were successful, generating a net operating profit of EUR 78.90 million.
The year 2023 also saw the successful integration of the former BAMC activities into SSH's operations. These activities were acquired through a merger with BAMC on 30 December 2022, which expanded SSH's management portfolio to include claim and real estate management.
SSH continues to actively engage in the denationalization process, focusing mainly on the most challenging cases in the recent years, and regularly satisfies it liabilities arising from denationalisation. In 2022, EUR 3.8 million in denationalization compensation was paid, with 161 denationalization claims still open at the end of the year.
Asset management
The estimated ROE of the portfolio for 2023 stands at 10.2%, exceeding the ROE planned in the 2023 Annual Asset Management Plan (AAMP), which stood at 7.3%. The outperformance in the profitability planned for 2023 has been primarily driven by the successful operations of SOEs in the energy sector.
Implementing a relevant dividend policy is one of core activities in the management of state assets. It enables SSH to pursue goals aiming at the maximisation of cash flows for the owner while simultaneously taking into account the performance results of individual companies, included in its management portfolio, and their development needs. In 2023, dividend payments by the companies in the SSH's management portfolio totalled EUR 175.5 million. Of this amount, EUR 122.3 million was distributed to RS and ZPIZ , while SSH received EUR 52.2 million. This represents a total increase of 7.9% over the planned amount of EUR 162.6 million.
At the end of 2023, the book value of equity stakes in the SSH's managed portfolio of assets amounted to EUR 12.2 billion, reflecting an increase of EUR 1.0 billion compared to the end of 2022 (EUR 11.2 billion).
The fair value of financial claims under management was EUR 203.5 million at the end of 2023, while the book value of tangible assets, primarily real estate, stood at EUR 94.3 million, with an estimated market value of EUR 158.8 million.
Highlights of 2023
Due to the conditions in the business environment, comprehensive management of business and financial risks was a priority in 2023. SSH closely monitored the situation, assessed its impact on the companies within its portfolio, and expected concrete actions from these companies to manage the risks.
In 2023, significant emphasis was placed on further developing sustainable business practices among companies, with a focus on gradually transitioning towards a carbon-neutral economy.
Another important strategic theme was governing corporate culture. SSH expects the members of the supervisory bodies to monitor and supervise this topic periodically within the established corporate governance system.
Enhanced development of corporate governance
Good corporate governance practices are crucial for the effective and responsible management of companies, ensuring that all significant decisions are made in a transparent and responsible manner, and in alignment with the best interests of the companies and their stakeholders. In 2023, improvements were made both within SSH’s own operations —through complex subject shifts in the SSH Asset Management Policy and other internal policies and regulations due to the merger with BAMC —and within portfolio companies, through revisions and updates to the SSH Recommendations and Expectations and the Corporate Governance Code for SOEs.
Similarly, the revised “Rules on the Assessment of Potential Candidates for Members of Supervisory and Management Boards of SOEs” , which defines in detail the conditions, criteria, and procedures for evaluating and determining the suitability of potential candidates for members of supervisory and management boards of SOEs, was markedly upgraded.