Strategic orientations of the Petrol Group for 2010 – 2014
The Strategic Business Plan of the Petrol Group for 2010 – 2014 is the basic corporate document defining the future mission, vision, values, goals and strategy of the Petrol Group for the period 2010 – 2014.
In the above-mentioned period, the Petrol Group will follow its vision to become a market player committed to meeting the highest quality and development standards relating to the comprehensive supply of energy products and the “convenience” model of service stations in SE Europe, ensuring above-average satisfaction of its customers.
The following, often inter-dependent factors, will significantly influence Petrol Group’s business operations: the economic situation in the European Union, SE Europe and the USA, US dollar exchange rate trends and oil price trends. Among the significant factors determining the domestic business environment are the following: domestic demand and economic growth, US exchange rate and measures introduced by the state to regulate prices and the energy market. It is expected that in 2010-2014 the business environment will be characterised by the stabilisation of economic situation and gradual exit from the economic crisis. The Institution for Macro-economic Analyses and Development predicts the economic situation will stabilize in 2010 and GDP will grow by 0.6%. In 2011, the economic growth is expected to achieve 2.4%, and 3.1% in 2012. Similar growth rates are also expected in SE European countries. The world oil market belongs to the most unstable markets; changes in the prices of crude oil and oil products may have significant impact on the level of sales revenues. On the majority of markets where the Petrol Group operates oil product sale prices are state regulated, and gross margin is defined as a fixed amount per litre of fuel. We suppose that such prices will remain valid and will not change. However, should one or more factors, mentioned above and considered when preparing our strategy, significantly change, the actual results may differ from the plans.
The Petrol Group will carry out its mission within its key business areas: oil trading activity on the Slovenian market, oil trading activity on the markets of SE Europe, and energy activity comprising the sale and distribution of natural gas and liquefied petroleum gas, heat, electricity, and energy and environmental solutions. The Group will operate on the markets of Slovenia, Croatia, Bosnia and Herzegovina, Serbia, Montenegro and Kosovo.
The main strategic orientations of the Petrol Group’s development are: stimulation of growth, increase in profitability, increase in added value per employee. Through a prudent investment policy, the Group will aim to maximize return on assets and maintain the financial stability of the Group. Quality and business excellence will remain its main guidelines.
The successful achievement of the above-mentioned goals will result in strengthening the Petrol Group’s long-term financial stability. The capital policy based on the long-term maximisation of shareholders’ yield is one of the key goals of our development strategy. Through a stable dividend policy, balanced dividend yields will be ensured and free cash flow used to finance the investment plans of the Petrol Group. This will result in the long-term growth and development of the Petrol Group and, consequently, in maximizing the value for owners.
The Petrol Group will implement the following strategies to achieve the above-mentioned goals: strengthening its position in the oil trading activity on the Slovenian market; aggressive expansion to the markets of SE Europe in order to develop and improve its market position, development of all kinds of energy activities in Slovenia, and transfer of successful business models to the markets of SE Europe.
The above-mentioned strategic goals will be achieved by carrying out activities in the following business areas:
- procurement of oil products and merchandise,
- logistics of oil products and merchandise, and
- development of conventional and alternative fuels.
An active sales policy will be pursued, supported by the carefully planned expansion of retail network and introduction of new services at and beside service stations, and by the broadening of our offer in all energy areas. We will strive to strengthen the Petrol brand name, emphasising the communication of the comprehensive energy supply in one place. The efficient procurement and logistics are among key factors contributing to the achievement of strategic goals. We will be oriented towards the development of conventional and alternative fuels, meeting the top quality standards and consistently following the relevant legislation regulating environmental protection.
The following key indicators are used to compare the Petrol Group’s performance with five biggest oil companies in SE Europe: market share in the oil trading activity on SE European markets (we wish to be one of three major trading companies in each of the states), above-average satisfaction of customers and high, 10% annual net profit growth.
The strategic business plan shows the Petrol Group’s development options, supported by well-founded arguments. We are sure that the Petrol Group employees’ creative energy will be directed towards the achievement of the planned goals, which will result in increasing the value of the company for its owners.
The Supervisory Board of Petrol d.d., Ljubljana at its meeting held on 20thApril, 2010 discussed and approved the strategic orientation of the Petrol Group for the period 2010 – 2014, which have been prepared by Petrol Management Board for the next medium term and requested to supplement strategy with financial projections.