Annual Report (ESEF) • Apr 29, 2024
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Download Source FileThis version of the Annual report is a translation from the original, which was prepared in Croatian language. All possible care has been taken to ensure that the translation is an accurate representation of the original. However, in all matters of interpretation of information, views or opinions, the original language version takes precedence over this translation.
If we were to look at the year 2023 through the prism of one event that marked the domestic economy and the capital market, it would certainly be the introduction of the euro. January mostly marked the first month of trading in the new currency, and by switching to the euro without difficulties for capital market participants, the Zagreb Stock Exchange made its contribution to the successful accession to the eurozone.
Another important event was the listing of the bonds of the Republic of Croatia primarily intended for small investors in March, when in the premises of the Stock Exchange, the Minister of Finance Marko Primorac and the President of the Management Board of the Zagreb Stock Exchange Ivana Gažić signed the contract on the listing of the bonds in question on the Official Market of the Stock Exchange in the presence of the Prime Minister Andrej Plenković. For the first time, this bond was distributed through the network of banks to citizens throughout Croatia, so the success of subscription was immense - about 44,000 citizens signed up for bonds.
Already in the fall, the Ministry of Finance continued with issues intended for citizens, offering for the first time a treasury bill as an investment option, in which more than 36,000 citizens invested. On those two occasions, about 27,000 citizens opened investment accounts for the first time, which proves that there are funds available for investment, but there are still too few investment opportunities in our market.
Later in the year, in May, the trading of a new ETF, which tracks the Romanian index BET-TR, began. Already in the first month of trading, it became clear that this is a very interesting product for retail investors, enabling efficient access to the attractive Romanian market. It was joined in October by another ETF, the first money fund in Croatia that can be traded on the stock exchange, and the fourth in total to be listed on the Zagreb Stock Exchange.
In July, an agreement was signed on the listing of bonds of Zagrebački holding d.o.o. on the Official Market of the Zagreb Stock Exchange, related to the sustainable operations of that company, in the presence of Zagreb Mayor Tomislav Tomašević, other such bonds on our market.
This year, the Zagreb Stock Exchange was once again among more than 100 world stock exchanges where the symbolic ringing of the bell signaled the start of trading on International Women's Day. On that occasion, messages were sent about the role that the business sector can play in empowering women as an important global goal of sustainable development.
In March, the Academy of the Zagreb Stock Exchange marked Global and European Money Week with a series of activities, leading a global event to raise awareness of the importance of financial education and financial inclusion for children and young people, and in May it also marked 13 years since its establishment: so far, about 100 different programs have been developed, The Academy organized over 600 educational events, with more than 12,000 participants. The Academy places great emphasis on the education of young people, especially students, more than 5,700 of whom have been educated over the years.
More than 1,000 participants gathered at our numerous other events where we strive to connect capital market participants and provide platforms for the exchange of information, knowledge, and experiences throughout the year.
In May, Macedonian Capital Market Days were held in Skopje for the first time, organized by the Macedonian Stock Exchange and co-organized by the Zagreb Stock Exchange. The aim of the event is to familiarize the participants of the Croatian capital market with the Macedonian market to facilitate Croatian investors' access to that market and explore the possibilities of cooperation and exchange of knowledge and experience. More than 50 representatives of Croatian and Macedonian investment companies, pension and investment funds, companies listed on both stock exchanges, regulators, depositories, and other infrastructure organizations of the financial market of both countries gathered in Skopje.
In June and December, the investment conferences of the Zagreb and Ljubljana stock exchanges "CEE Investment Opportunities" were traditionally held, with the aim of enabling immediate contact between companies and investors in one place in a short period of time. In addition to Croatian and Slovenian companies, companies listed on the Macedonian Stock Exchange participated in this year's event, and for the first time several Romanian companies from the Bucharest Stock Exchange, as well as several companies listed on the Bulgarian Stock Exchange. More than 400 meetings were held at both events.
The Croatian Financial Services Supervisory Agency, the Central Clearing Depository Company and the Zagreb Stock Exchange held the 14th annual training for companies whose securities are listed on the regulated market of the Zagreb Stock Exchange. More than 100 representatives of issuers took part, and this year they were also presented with novelties related to the regulation of the capital market and other related topics.
| 2023-12-31 | 2022-12-31 | 2022-01-01 | 2021-12-31 | |
|---|---|---|---|---|
| Issued Capital | 74,780,000 | 74,780,000 | 74,780,000 | 74,780,000 |
| Share Premium | 50A040C0D041 | 50A040C0D041 | 50A040C0D041 | 50A040C0D041 |
| Statutory Reserve | ||||
| Treasury Shares | ||||
| Other Reserves | ||||
| Reserve of Gains and Losses on Financial Assets Measured at Fair Value Through Other Comprehensive Income | ||||
| Retained Earnings | ||||
| Equity Attributable to Owners of Parent |
| 2023-01-01 | 2023-12-31 | |
|---|---|---|
| Issued Capital | 74,780,000 | 74,780,000 |
| Share Premium | 50A040C0D041 | 50A040C0D041 |
| Statutory Reserve | ||
| Treasury Shares | ||
| Other Reserves | ||
| Reserve of Gains and Losses on Financial Assets Measured at Fair Value Through Other Comprehensive Income | ||
| Retained Earnings | ||
| Equity Attributable to Owners of Parent |
| 2022-01-01 | 2022-12-31 | |
|---|---|---|
| Issued Capital | 74,780,000 | 74,780,000 |
| Share Premium | 50A040C0D041 | 50A040C0D041 |
| Statutory Reserve | ||
| Treasury Shares | ||
| Other Reserves | ||
| Reserve of Gains and Losses on Financial Assets Measured at Fair Value Through Other Comprehensive Income | ||
| Retained Earnings | ||
| Equity Attributable to Owners of Parent |
| 2021-12-31 | |
|---|---|
| Issued Capital | 74,780,000 |
| Share Premium | 50A040C0D041 |
| Statutory Reserve | |
| Treasury Shares | |
| Other Reserves | |
| Reserve of Gains and Losses on Financial Assets Measured at Fair Value Through Other Comprehensive Income | |
| Retained Earnings | |
| Equity Attributable to Owners of Parent |
| 2022-01-01 | 2022-12-31 | |
|---|---|---|
| Issued Capital | 74,780,000 | 74,780,000 |
| Share Premium | 50A040C0D041 | 50A040C0D041 |
| Statutory Reserve | ||
| Treasury Shares | ||
| Other Reserves | ||
| Reserve of Gains and Losses on Financial Assets Measured at Fair Value Through Other Comprehensive Income | ||
| Retained Earnings | ||
| Equity Attributable to Owners of Parent |
| 2022-12-31 | |
|---|---|
| Issued Capital | 74,780,000 |
| Share Premium | 50A040C0D041 |
| Statutory Reserve | |
| Treasury Shares | |
| Other Reserves | |
| Reserve of Gains and Losses on Financial Assets Measured at Fair Value Through Other Comprehensive Income | |
| Retained Earnings | |
| Equity Attributable to Owners of Parent |
| 2023-01-01 | 2023-12-31 | |
|---|---|---|
| Issued Capital | 74,780,000 | 74,780,000 |
| Share Premium | 50A040C0D041 | 50A040C0D041 |
| Statutory Reserve | ||
| Treasury Shares | ||
| Other Reserves | ||
| Reserve of Gains and Losses on Financial Assets Measured at Fair Value Through Other Comprehensive Income | ||
| Retained Earnings | ||
| Equity Attributable to Owners of Parent |
| 2023-12-31 | |
|---|---|
| Issued Capital | 74,780,000 |
| Share Premium | 50A040C0D041 |
| Statutory Reserve | |
| Treasury Shares | |
| Other Reserves | |
| Reserve of Gains and Losses on Financial Assets Measured at Fair Value Through Other Comprehensive Income | |
| Retained Earnings | |
| Equity Attributable to Owners of Parent |
iso4217:EUR
iso4217:EURxbrli:shares/divIn addition, the Zagreb Stock Exchange and the Croatian Financial Services Supervisory Agency also implemented an educational program on corporate governance called "Governance and ESG Development", implemented with the support of the European Bank for Reconstruction and Development, which gathered around 300 representatives of listed companies in five modules and also other individuals and organizations interested in issues of corporate governance and related topics from Croatia and the region. This year's "Challenge of Change" conference, the most important financial conference in Croatia and the region, which has been co-organized by the Zagreb Stock Exchange and the Association of Pension Fund Management and Pension Insurance Companies since 2012, gathered a record 550 participants this year. In May, the Zagreb Stock Exchange founded the associated company Adria Digital Exchange d.o.o., with the intention of researching and developing the potential for trading and management of virtual assets, in which the Stock Exchange has a 24% share. In the middle of the year, a project led by the CFA Croatia association began, which mobilized a wide range of market participants from all branches of the financial industry with the aim of creating a foundation for a capital market development strategy. Namely, Croatia has clearly expressed its intention to join the OECD, the community of the most developed countries in the world, for which the process of numerous adjustments and improvements has already begun, one of which will be the adoption of a capital market development strategy by the Government of the Republic of Croatia. The project, of which we are an active participant, aims to propose a series of measures that can result in a more developed market to the benefit of the entire economy and all market participants. The Zagreb Stock Exchange became a partner in the Interreg MESTRI-CE project aimed at testing a new financing model for more climate-sustainable buildings. Participation in such projects is part of the development strategy of the Stock Exchange, which strengthens the capacities of the capital market and its participants in accordance with the modern goals of the green transition and sustainability of the EU member states. At the very end of the year, the Zagreb Stock Exchange, Mazars and Poslovna inteligencija signed a contract that marks the beginning of the creation of an advanced solution for the automated valuation of companies based on machine learning: the Artificial Intelligence Research Project (AIR). The project is financed by the EBRD, with the support of the Taiwan Business EBRD Technical Cooperation fund, and the goal of the project in the first phase of development is to produce a solution that will enable the preparation of automated reports on the valuation of shares for listed companies, while the solution in question in the second phase would connect with AI technology. December is traditionally also the month of the Zagreb Stock Exchange Awards, which the Stock Exchange has been awarding for the twelfth year in a row. The event gathered about a hundred guests, and prizes were awarded in a total of seven categories, considering objective, statistical criteria, as well as the overall contribution to education and the development of the domestic capital market. Excellent cooperation with the regulator, members, issuers, infrastructural institutions of the capital market and other stakeholders was crucial again this year for the Zagreb Stock Exchange to justify its position as a regional leader and continue to provide a high level of quality of its services.
In 2023, operating revenues decreased by -0.9% compared to 2022, amounting to EUR 2,018 thousand. The slight decrease in operating revenue was the result of lower income from trading commissions (-4.1%), and fewer number of newly listed securities in 2023 resulted in a decrease in income from listing fees. Other operating income increased by EUR 45.8 thousand, primarily due to increased income from the supply of information (+8.3%), and other income, which includes income from associated companies and income assigning and administering LEIs (+5.4%).
In 2023, operating expenses increased by +3.6% when compared to 2022. The increase of operating expenses was primarily caused by an increase in costs of software and licensing (+17%). Staff costs decreased by -0.14% compared to 2022. The year 2023 was thus concluded with an operating loss of EUR -33 thousand, an excellent net financial result of EUR +171 thousand and a net profit of EUR 136 thousand. Operating profit before interest, taxes, depreciation and amortization in 2023 amounts to EUR 174 thousand, which is a decrease of -26% compared to 2022.
| EUR | 2021 | 2022 | change | |
|---|---|---|---|---|
| Share capital | 3,076,316 | 3,076,315 | 0.00% | |
| Capital and reserves | 5,819,123 | 6,027,948 | 3.59% | |
| Total assets | 6,830,377 | 6,942,647 | 1.64% | |
| Operating revenue | 2,035,861 | 2,017,744 | -0.89% | |
| Sales revenue | 1,363,283 | 1,299,319 | -4.69% | |
| Other operating income | 672,578 | 718,425 | 6.82% | |
| Operating expenses | 1,980,574 | 2,051,463 | 3.58% | |
| Staff costs | (1,003,649) | (1,002,235) | -0.14% | |
| Depreciation and amortization | (180,410) | (207,741) | 15.15% | |
| Other costs | (796,515) | (841,487) | 207.49% | |
| EBIT | 55,288 | -33,719 | -160.99% | |
| EBITDA | 235,698 | 174,022 | -26.17% | |
| Net financial result | -53,851 | 171,752 | 419.12% | |
| EBT | 1,436 | 138,033 | 9512.33% | |
| Income tax credit | -15,464 | 1,830 | 111.83% | |
| Profit for the year | 16,900 | 136,203 | 705.93% | |
| Number of shares | 2,317,850 | 2,317,850 | 0.00% | |
| Number of employees | 25 | 23 | -8.00% |
Zagreb Stock Exchange shares were listed on the regulated market (Official market segment) in August 2016. Following the conversion of the Company’s share capital to euro, the share capital amounts to EUR 3,076,315 and is divided to 2,317,850 ordinary shares. As of December 31, 2023, the Company owns a total of 8,396 of own shares, which make up for 0.3611% of its share capital. From January 1 to December 31 2023, Zagreb Stock Exchange’s share reached a total orderbook turnover of EUR 95,202.98.
| Symbol | ISIN | Number of listed shares | Total turnover (HRK) | Total trading volume | Highest price (HRK) | Lowest price (HRK) | Last price (HRK) | Average daily turnover (HRK) |
|---|---|---|---|---|---|---|---|---|
| ZB-R-A | HRZB00RA0003 | 2,317,850 | 95,202.98 | 29,749 | 4.5 | 2.5 | 2.76 | 1,322.26 |
The ZB-R-A stock price reached its peak on January 3, 2023 in the amount of EUR 4.5, while it fell to its lowest level on December 12, 2023, when it was priced at EUR 2.5.
A total of 195 shareholders were noted in the ownership structure of the Zagreb Stock Exchange on 31 December 2023.
In 2023, the Company generated a total of EUR 2,018 thousand of operating revenues, which is EUR -18 thousand or -0.9% less than in the previous year when they amounted to EUR 2,036 thousand. Compared to 2022, sales revenues decreased from EUR 1,363 to EUR 1,299 thousand, i.e., by EUR -63.9 thousand or -4.7%. The decrease in sales revenue is primarily the result of reduced revenues from trading commissions and memberships, which, following a lower turnover in securities compared to 2022, in 2023 reached EUR 499 thousand (EUR -22 thousand or -4.1% more compared to 2022 when they amounted to EUR 521 thousand). Following a lower number of newly listed securities than in the previous year, income from quotation fees in 2023 amounted to EUR 122 thousand, which is EUR -34.9 thousand or -22% less than in 2022. Within sales revenues, income from quotation maintenance decreased to EUR 678 thousand (a decrease of EUR -7.5 thousand or -1% compared to 2022, when they amounted to EUR 685 thousand). Compared to 2022, other operating income increased by EUR +45.8 thousand or +6.8%, i.e., from EUR 673 to EUR 718 thousand. This increase in other operating income is due to the growth of revenue from assigning and administering LEIs, which amounted to EUR 79 thousand (EUR +14 thousand or +22%), income from seminars which amounted to EUR 113 thousand (EUR +4.6 thousand or +4.3%) and income from the supply of information, which marked a significant increase from EUR 327.8 thousand in 2022 to EUR 355 thousand in 2023 (EUR +27 thousand or +8.3%). In 2022, other income increased by EUR +18 thousand, or +5.4% and amount to EUR 363 thousand (2022: EUR 344 thousand). Influenced by the general increase in prices, in 2023 the Company recorded an increase in total operating expenses. Total operating expenses increased by EUR +70.8 thousand (+3.6%) compared to 2022 and amounted to EUR 2,051 thousand (2022: EUR 1,981 thousand). The increase in operating expenses was mostly due to the increase in costs of software and licensing (EUR +46.9 thousand or +17%). Depreciation and amortization in 2023 increased by +15% and amounts to EUR 207 thousand (2022: EUR 180 thousand) and relates to purchased IT equipment. Other expenses at the end of 2023 amount to EUR 85.9 thousand, representing a decrease by -0.4% compared to 2022 when they amounted to EUR 86.4 thousand. Other operating expenses in 2023 amount to EUR 841 thousand, which is an increase by EUR +44.9 thousand or +5.6% (2022: 796.5 thousand). Staff costs in 2023 decreased by EUR -1.4 thousand or -0.1% (from EUR 1,003 to EUR 1,002 thousand), compared to 2022. The Company's operating loss in 2022 amounted to EUR -33.7 thousand, while in the previous year the Company reported operating profit amounting to EUR 55 thousand (EUR -89 thousand or -161%).# 1.4 Business analysis
Total operating revenues in 2023 amount to EUR 2,018 thousand and are lower by EUR -19 thousand or +0.9% compared to 2022 when they amounted to EUR 2,036 thousand. The largest increase in revenue was recorded in revenue from assigning and administering LEIs (EUR +14 thousand or +22%), and the largest decrease in revenue from quotation fees (EUR -35 thousand or -22%).
Figure 4: Operating revenue
As in the previous year, in 2023 income from quotation maintenance (34%) had the largest share in operating revenues, followed by revenues from trading commissions and membership fees (25%). In 2023, income from quotation fees claimed a smaller share in operating revenues, while income from the supply of information, income from seminars and other income increased their share in the Company’s operating revenues.
Figure 5: Operating revenue structure
In 2023, EUR 474 thousand was generated on the basis of trading commissions, which is EUR -21 thousand or -4.3% more compared to 2022, when they amounted to EUR 495 thousand. At the end of 2023, the Exchange had a total of 12 members, the same as in 2022, but membership fees revenues are lower by EUR -124 or -0.5% and amount to EUR 25.5 thousand.
Revenue from quotation maintenance decreased from EUR 685 to EUR 677.7 thousand (EUR -7.5 thousand or -1%). At the end of 2023, 87 stocks (2022: 92), 31 bonds (2022: 30), 7 treasury bills (2022: 14) and 4 ETFs (2022: 2) were listed on the Regulated Market.
In 2023, revenue from quotation fees decreased from EUR 157 to EUR 122 thousand (EUR -34 thousand or -22%) compared to the previous year. In 2023, sixteen treasury bills, four bonds and two ETFs were listed, while in 2022, new listings included two shares, five bonds and fourteen treasury bills.
Figure 6: Sales revenue structure
Other operating income increased by EUR +46 thousand or +6.8% compared to 2022 (from EUR 673 to EUR 718 thousand) due to the growth of revenue from the supply of information amounting to EUR 355 thousand (EUR +27 thousand or +8.3%), increase in revenues from assigning and administering LEIs amounting to EUR 79 thousand (EUR +13 thousand or +22%), and revenues from seminars that increased by EUR +4.6 thousand or +4.3% and amounted to EUR 113.3 thousand. Within other operating income, the only decrease is noted in revenues from affiliates (EUR -10 thousand or -18%, i.e., from EUR 57 to EUR 47 thousand). Revenues from the supply of information have the largest share in other operating income (49%), which also includes income from real-time data distribution rights paid by members.
Figure 7: Other operating income structure
Total operating expenses in 2023 amounted to EUR 2,051 thousand, which is an increase of EUR +70.8 thousand or +3.6% (in 2022 they amounted to EUR 1,981 thousand).
Figure 8: Operating expenses structure
Despite the general increase of prices and rising inflation, the Company maintained continuous efforts to control expenses during 2023. During 2023, the number of employees reduced from 25 to 23, resulting in a decrease in staff costs. Staff costs decreased from EUR 1,004 to EUR 1,002 thousand (EUR -2 thousand or -0.1%). Depreciation increased by EUR +27 thousand or +15% (from EUR 180 to EUR 208 thousand).
Figure 9: Other operating expenses structure
Other operating expenses at the end of 2023 amounted to EUR 841 thousand, representing an increase of EUR +44.9 thousand or 5.6% (2022: EUR 796 thousand). Among them, the most significant is the increase in the costs of software and licenses from EUR 276 to EUR 323 thousand (EUR +46.9 thousand or +17%) which have the largest share in other operating expenses (38%).
In 2023, the net profit for the period amounted to EUR 136 thousand; an increase of EUR +119 thousand or +706% compared to the previous year when net profit amounted to EUR 16.9 thousand. The recorded decrease in operating revenues (-0.9%) was offset by increased other operating (+6.8%) and financial (+178%) revenues. In 2023, the Company increased revenues from other bases, where it is necessary to highlight revenues from assigning and administering LEIs which amounted to EUR 79 thousand, revenues from seminars which amounted to EUR 113.3 and a positive net financial result amounting to EUR +171.7 thousand. Other comprehensive income in 2023 amounted to EUR +91.8 thousand, and increase of EUR +21.7 thousand or +30.9% (2022: EUR 70 thousand). At the end of 2023, total comprehensive income of the Company increased by EUR +141 thousand or +162% and amounted to EUR 228 thousand (2022: EUR 87 thousand). Operating profit before interest, taxes, depreciation and amortization decreased compared to the previous year (EUR -61.7 thousand) and in 2023 amounted to EUR 174 thousand.
Figure 10: Net profit for the year and EBITDA
As of 31 December 2023, the total assets of the Company amounted to EUR 6,929 thousand, which is +1.4 % more than on the last day of 2022.
| EUR 2022. | EUR 2023. | change | |
|---|---|---|---|
| Non-current assets | 4,666,225 | 4,604,038 | -1.3% |
| Current assets | 2,164,151 | 2,324,982 | 7.4% |
| Inventories | 0 | 0 | 0.0% |
| Trade receivables | 269,984 | 334,437 | 23.9% |
| Financial assets | 736,505 | 1,191,398 | 61.8% |
| Short-term deposits | 8,136 | 1,126,162 | 13741.7% |
| Cash and cash equivalents | 667,895 | 114,249 | -82.9% |
| Prepaid expenses | 13,619 | 13,629 | 0.1% |
| Total assets | 6,830,376 | 6,929,020 | 1.4% |
| Equity | 5,819,123 | 6,027,948 | 3.6% |
| Long term obligations | 230,548 | 140,888 | -38.9% |
| Deferred tax liability | 0 | 6,540 | |
| Current liabilities | 780,705 | 760,184 | -2.6% |
| Total equity and liabilities | 6,830,376 | 6,929,020 | 1.4% |
Table 3: Balance Sheet on 31 December
The structure of the balance sheet has changed slightly compared to 2022. On the assets side, non-current assets decreased their share in the total assets, while on the liabilities side the share of long- term obligations decreased, and the share of short-term liabilities remained unchanged.
Figure 11: Assets and Liabilities Structure
In the first quarter of 2024, the Company continued its successful business operations from the end of the previous year. Due to the financial results achieved in 2023, the successful beginning of 2024, and the projections for the remainder of 2024, the Company’s Management Board believes that the unlimited continuation of business is not threatened. The war in Ukraine and sanctions against the Russian Federation are affecting economies in Europe and the world. The company has no significant exposure in Ukraine, Russia and Belarus. However, the effect on the general economic situation may require a revision of certain assumptions and estimates, which may lead to adjustments in the carrying amount of certain assets and liabilities during 2024. The Company, like all other business entities in Croatia, is prone to risks related to the increase of prices of goods and services, and as such is aware of the increased risks caused by inflation which continues in the future period, although current economic indicators and forecasts point to the inflation rate slowing down significantly. The long-term effects may affect business volume, cash flows and profitability. It is expected that interest rates stabilize in 2024, and even a reduction of the interest rates might affect the Company’s financial results. Regardless of the aforementioned, on the date of publishing of these financial reports, the Company continues to meet all of its obligations, is highly capitalized and has significant free assets at its disposal, and the Management Board, therefore, applies the principle of indefinite operations as an accounting basis for the preparation of financial statements.
In 2024, the Company will continue to focus on raising Corporate Governance and reporting standards on the regulated market. The Company will also focus on greater promotion of existing issuers, with a focus on the Prime Market. During September 2023, the Company initiated activities related to promotion of the issuers in the tourism sector, with the goal of profiling the Croatian capital market as the leading place for financing tourism companies in South-East Europe, and increasing their visibility via the Company’s website and associated communication channels. In 2024, The Company will focus on preparing the issuers for non-financial reporting requirements, which will come into force for all listed companies over the period of next three years.The Company will continue to develop internal IT services that will be used by the Zagreb and Ljubljana Stock Exchanges, and thus further reduce the need for external suppliers. In 2024, The Company will press on with previously initiated projects, placing the greatest emphasis on the projects related to the implementation of new technologies to market activities, regional SME capital market development (Progress), and education of market participants regarding green bond listings withing the framework of the MESTRI CE project which is financed by the European union. The Company will continue efforts in promoting ESG listings and issuer activities. During 2024, the Company will also focus on compliance activities for the upcoming Digital Operational Resilience Act (DORA) regulation which will provide detailed cyber security and risk management requirements for entities in the financial sector. DORA will come into effect in January, 2025.
The Company has pressed on with continuous efforts at developing and improving its own service offering and at expanding service provision to the Slovenian market as well. The beginning of 2023 marked the successful transition to euro as the official currency of the Republic of Croatia, and Zagreb Stock Exchange continued the activities on adjusting its services, publications and procedures according to the new currency. In the second quarter of 2023, the Company successfully completed an initiated migration of legacy services used by Ljubljana Stock Exchange and provided by Vienna Stock Exchange. Zagreb Stock Exchange thus further strengthened its position as the leading trading service provider for the entire Zagreb Stock Exchange Group, actively reducing costs and dependence on external service providers.
On May 15, 2023, Zagreb Stock Exchange, Inc. successfully completed the seventh annual accreditation process as a Local Operating Unit authorized to issue LEI codes, issued by the Global Legal Entity Identifier Foundation (GLEIF). By the end of 2023, the Company successfully completed the implementation of two new trading system releases and other infrastructure optimization activities.
On December 31, 2023, the Exchange owns a total of 8,396 of own shares, which make up for 0.3611% of the Exchange’s total issued share capital.
On 30 December 2015, the Zagreb Stock Exchange took over a 100% participation in company Ljubljana Stock Exchange Inc. The issued share capital of Ljubljana Stock Exchange on 31 December 2022 is EUR 1,401,000, and the Zagreb Stock Exchange participates with 100%. Ivana Gažić, President of the Management Board of the Zagreb Stock Exchange, is the President of the Supervisory Board of the Ljubljana Stock Exchange, and the members of the Supervisory Board as of 31 December 2022 are Tomislav Gračan, Member of the Management Board of the Zagreb Stock Exchange, and Matko Maravić, Member of the Supervisory Board of the Zagreb Stock Exchange.
SEE Link LLC., is a company seated in Skopje established by the Bulgarian, Macedonian and Zagreb Stock Exchanges in May 2014 with the aim of setting up the regional infrastructure for trading in securities listed in those three exchanges, holding equal equity participations. The issued share capital of SEE LINK is 80,000 EUR and Zagreb Stock Exchange participates with 33.33%. Manyu Moravenov, Executive Director of the Bulgarian Stock Exchange, is the President of the Supervisory Board of SEE Link. Ivana Gažić, President of the Management Board of the Zagreb Stock Exchange, and Ivan Steriev, President of the Management Board of the Macedonian Stock Exchange, are members of the Supervisory Board of SEE Link.
Funderbeam South-East Europe d.o.o. is a company that the Zagreb Stock Exchange founded in 2016 together with company Funderbeam Ventures OÜ. The issued share capital of the company is HRK 244,000, and the Exchage participates with 30%.
Macedonian Stock Exchange, Inc., a company seated in Skopje. The issued share capital of Macedonian Stock Exchange amounts to EUR 1,695,029.03, in which the Zagreb Stock Exchange, Inc. holds a total of 837 shares, i.e., 29.98% of the issued share capital. Ivana Gažić, president of the Management Board of Zagreb Stock Exchange, is a member of the Supervisory Board of the Macedonian Stock Exchange.
Adria Digital Exchange LLC., a company seated in Zagreb, founded in 2023 with the goal of detailed analysis and development of potential for trading and managing of virtual assets. The share capital of the company is EUR 5,000, in which the Zagreb Stock Exchange, Inc. participates with 24%. Tomislav Gračan, member of the Management Board od Zagreb Stock Exchange, fulfills the role of director at the company.
Central Depository & Clearing Company, Inc., seated in Zagreb. The issued share capital of the company amounts to EUR 12,545,620, in which the Zagreb Stock Exchange, Inc. holds a total of 1,259 shares, i.e., 1.27 % of the issued share capital.
EuroCPT B.V., a company seated in Amsterdam, founded in 2023 with the goal of supplying consolidated trading data in the European Union. The share capital of the company is EUR 99.53, in which the Zagreb Stock Exchange, Inc. participates with 0.05%.
The Company is fully funded by its own capital. The financial instruments the Company invests in are investment funds (money market and bond funds) and bank deposits.
Business operation risks are detailed in the notes to the financial statements (Note 23).
In 2023, the orderbook turnover amounted to EUR 371 million, -5.3% less than in 2022, as a result of lower block turnovers, while the orderbook turnover recorded growth. From the total orderbook turnover in 2023, shares turnover amounted to EUR 267 million which is an increase of +17.5% (2022: EUR 227 million), bond turnover amounted an impressive EUR 39 million which is an increase of 135.7% (2022: EUR 16.5 million), ETF turnover increased by +58.4% and amounted to EUR 16 million (2022: EUR 10 million). The equity block turnover amounted to EUR 49 million which is a decrease by 72.8% compared to 2022 (2022: EUR 138.5 million). Debt block turnover was recorded for the first time since 2021, and amounted to EUR 11.7 million.
| EUR | 2019 | 2020 | 2021 | 2022 | 2023 |
|---|---|---|---|---|---|
| Orderbook turnover | 328,044,957 | 342,137,423 | 260,415,421 | 254,183,661 | 322,392,362 |
| Stocks | 289,219,560 | 305,298,798 | 230,867,972 | 227,453,541 | 267,231,559 |
| Bonds | 38,825,398 | 33,930,510 | 23,528,210 | 16,590,759 | 39,102,749 |
| ETFs | - | 2,908,115 | 6,019,239 | 10,139,362 | 16,058,055 |
| Total Block Turnover | 69,360,634 | 73,145,212 | 76,661,552 | 138,556,558 | 49,394,997 |
| Equity Block Turnover | 69,360,634 | 73,145,212 | 69,979,636 | 138,556,558 | 37,617,572 |
| Debt Block Turnover | - | - | 6,681,917 | - | 11,777,425 |
| Total Turnover | 397,405,591 | 415,282,635 | 337,076,973 | 392,740,219 | 371,787,359 |
The market value measured by market capitalization as of 31 December 2023 has increased by EUR 6.4 billion compared to the end of 2022. The equity market capitalization increased by EUR +4,9 billion or +27.2% in total, with the market capitalization of the Prime Market increasing by +29%, the Official Market by +16.6%, and the Regular Market by 35.1%. The market capitalization of bonds increased by +9.5%, while the market capitalization of ETFs increased by an impressive +215.4%.
| 2022 | 2023 | change | 2022 | 2023 | change | |
|---|---|---|---|---|---|---|
| Market Capitalization (EUR) | Number of listed securities | |||||
| Shares | 18,020,297,839 | 22,921,642,696 | 27.20% | 92 | 87 | -5.43% |
| Prime Market | 3,776,765,393 | 4,872,990,193 | 29.03% | 6 | 6 | 0.00% |
| Official Market | 6,480,465,545 | 7,560,463,836 | 16.67% | 20 | 20 | 0.00% |
| Regular Market | 7,763,066,900 | 10,488,188,667 | 35.10% | 66 | 61 | -7.58% |
| Bonds | 16,329,871,735 | 17,879,846,903 | 9.49% | 30 | 31 | 3.33% |
| ETFs | 7,476,860 | 23,581,647 | 215.40% | 2 | 4 | 100.00% |
| Money Market Instruments | / | / | 12 | 7 | -41.67% | |
| TOTAL | 34,357,646,434 | 40,825,071,246 | 18.82% | 136 | 129 | -5.15% |
Compared to 31 December 2022, at the end of 2023, a total of five shares less were listed on the Regular Market, while the number of shares listed on the Prime and Official Markets remained unchanged.
All equity indices recorded growth compared to 2022. The strongest increase was that of CROBEXindustrija (+56%), followed by CROBEXprime (+41.2%) and CROBEXplus (+31.5%). The regional index ADRIAprime increased by a significant +32.4%, the bond index CROBIStr increased by +1.8%, while CROBIS decreased by -0.8%.
| Index | 31.12.2022. | 31.12.2023. | change | Turnover (EUR) 2022 | Turnover (EUR) 2023 | change |
|---|---|---|---|---|---|---|
| CROBEX | 1.979,88 | 2.533,92 | 27.98% | 190,434,945 | 216,827,639 | 13.9% |
| CROBEXtr | 1.415,96 | 1.881,34 | 32.87% | 190,434,945 | 216,827,639 | 13.9% |
| CROBEX10 | 1.156,15 | 1.548,60 | 33.94% | 139,159,613 | 175,720,436 | 26.3% |
| CROBEX10tr | 1.222,39 | 1.683,53 | 37.72% | 139,159,613 | 175,720,436 | 26.3% |
| CROBEXprime | 1.149,64 | 1.622,76 | 41.15% | 92,174,406 | 103,070,128 | 11.8% |
| CROBEXplus | 1.360,86 | 1.789,63 | 31.51% | 185,536,320 | 215,185,939 | 16.0% |
| CROBEXindustrija | 1.048,52 | 1.636,40 | 56.07% | 30,733,192 | 33,757,427 | 9.8% |
| CROBEXkonstrukt | 554,21 | 523,32 | -5.57% | 2,560,028 | 2,643,039 | 3.2% |
| CROBEXnutris | 726,5 | 931,64 | 28.24% | 34,621,239 | 51,221,059 | 47.9% |
| CROBEXtransport | 1234,04 | 1.497,91 | 21.38% | 26,163,421 | 18,074,300 | -30.9% |
| CROBEXturist | 3.526,57 | 4.114,36 | 16.67% | 33,790,474 | 34,541,291 | 2.2% |
| CROBIS | 96,63 | 95,87 | -0.78% | 705,831,223 | 543,408,644 | -23.01% |
| CROBIStr | 168,49 | 171,44 | 1.75% | 705,831,223 | 543,408,644 | -23.01% |
| ADRIAprime | 1.302,88 | 1.724,76 | 32.38% | \ | \ | \ |
The most traded share in 2023 was that of Podravka d.d., followed by Span d.d., Valamar Riviera d.d., Zagrebačka banka d.d., and Hrvatski telekom d.d.# The first five most liquid shares make up of 36.5% of the total orderbook turnover of Zagreb Stock Exchange.
| Rank | Ticker | Issuer | Turnover (EUR) | Turnover share |
|---|---|---|---|---|
| 1 | PODR | PODRAVKA d.d. | 44,022,681 | 11.8% |
| 2 | SPAN | SPAN d.d. | 30,790,402 | 8.3% |
| 3 | RIVP | VALAMAR RIVIERA d.d. | 23,840,299 | 6.4% |
| 4 | ZABA | ZAGREBAČKA BANKA d.d. | 18,590,621 | 5.0% |
| 5 | HT | HT d.d. | 18,427,050 | 5.0% |
| Ostali | 236,116,306 | 63.5% | ||
| UKUPNO | 371,787,359 | 100.00% |
Table 7: Turnover of the 5 most liquid shares in 2023
At the end of 2023, the Exchange had 12 members, and the top five members of the Exchange with the highest turnover in 2023 are listed in the following table:
| Rank | Member | Turnover(EUR) | Turnover share |
|---|---|---|---|
| 1 | INTERKAPITAL VRIJEDNOSNI PAPIRI D.O.O. | 201,420,582 | 27.0% |
| 2 | ZAGREBAČKA BANKA D.D. | 94,707,129 | 12.7% |
| 3 | PRIVREDNA BANKA ZAGREB D.D. | 79,888,777 | 10.7% |
| 4 | FIMA-VRIJEDNOSNICE D.O.O. | 73,910,254 | 9.9% |
| 5 | ERSTE&STEIERMARKISCHE D.D. | 65,531,080 | 8.8% |
| Ostali | 230,226,817 | 30.9% | |
| UKUPNO | 745,684,638 | 100.00% |
Table 8: Top 5 members of the Stock Exchange in 2023
The turnover of the first five members of the Exchange accounts for slightly more than 70% of the total turnover.
The Zagreb Stock Exchange regularly provides support to member firms regarding the Exchange trading process. This includes both configuring and testing of the trading system itself, and the preparation of various support applications used for trading. In that respect, the Exchange actively communicates with member firms during the implementation of new trading system functionalities and other changes which might reflect on the members’ business. It focuses especially on own member-side applications, developed using the FIX (a Vienna Stock Exchange version – CEESEG FIX) protocol interface. In cooperation with the Vienna Stock Exchange, the Exchange provides support to member firms when developing their own applications and conducts initial certification of their software solutions. The Exchange also provides other forms of technical support and, for that purpose, it has made available a dedicated collaboration website (http://it.zse.hr) for users to submit their support requests directly to the Information and Technology Development Department.
Zagreb Stock Exchange offers advisory and professional support to all issuers listed on the Regulated or Progress market, and works closely with issuers regarding their compliance with the provisions of the Capital Market Act, EU Directive 596/2014, the Rules of the Exchange and other regulations. The Exchange also monitors if issuers and their listed securities meet the conditions for listing on the Regulated Market, and if the issuers fulfill their obligations defined in the Rules of the Exchange. Every year, the Exchange organizes a joint education for the issuers on the Regulated Market in co-operation with the Croatian Financial Services Supervisory Agency and the Central Depository and Clearing Company. Participation in the education is free, and is highly recommended to all issuers since it covers trending topics on the capital market.
The Exchange licenses authorized advisors on the Progress Market and monitors the entire application process for trade listing on the Progress Market. It also handles trade supervision and ensures that issuers fulfill their obligations towards the Exchange after they have listed on the Progress Market. The Zagreb Stock Exchange strategy, among other things, includes continuous education of issuers in order to increase the level of transparency and corporate governance in all market segments, especially following the significant change to the Exchange Rules in December 2019, regarding the supervising of issuers in terms of fulfilling post-listing obligations. It is estimated that the changes to the Rules played a significant role in the raising the quality and timeliness of reporting on the Regulated market.
Zagreb Stock Exchange internal controls system consists of procedures and processes for monitoring of business efficiency, financial reporting reliability and legal compliance. All employees, including the Management and Supervisory Board, are included in internal controls system enforcement. The Exchange enforces the internal controls system through two independent control functions: compliance with the relevant regulations function and internal audit function. These control functions process and monitor the work of all organizational units, company activities and support services in their internal documents. Risk management is a set of procedures and methods for determining, measuring, assessing, controlling and monitoring risks and also reporting on the risks to which the Exchange is or might be exposed in its operations. The Exchange has adopted the following procedures related to risk management:
The internal auditor, Antares revizija d.o.o., compiles the following documents:
In order to successfully manage risks that affect completion of Company’s objectives, the Company assesses risks by identifying and analyzing them. Considering the Company’s determined objectives and defined core processes, the Exchange has identified and determined risks that could influence the company’s business processes. List of risks doesn’t encompass all risks but only those on higher level. Other, more detailed risks (lower-level risks) are identified during the internal audit of business processes. The risks are grouped by those that influence the Exchange’s organizational units that perform specific business processes within the company and by other risks that are connected with the Exchange’s business in general. Considering the previously defined company’s core business processes and determined risks, the Exchange has adopted Risk assessment with regard to their impact on business processes. Risk assessment encompasses every process’s inherent risk and during the assessment, the very nature of those processes and best practice were taken into consideration. Based on the risk assessment results, main areas that will be covered by internal audit procedures and measures that will prevent the occurrence of risky events have been established. Risk monitoring is not separated and entrusted to Company’s independent organizational unit, but to one or more Company’s departments, depending on the type of risk. Therefore, every employee of the Exchange is included in Company’s risk management. Each organizational unit, depending on the identified risks and risk management system, is in charge of risk monitoring and cooperation with other organizational units, especially with the Management Board who makes decisions on individual risk management and its control. In addition, two mutually independent control functions are involved in Company’s risk management system: compliance with relevant regulations function (Compliance Department within the Sector of Legal and General Affairs) and internal audit performed by the independent company Antares revizija d.o.o.
Pursuant to provision of Article 272, paragraph, in conjunction with provision of Article 250a, paragraph 4 of the Companies Act (Official Gazette no. 111/93, 34/99, 52/00, 118/03, 107/07, 148/08, 137/09, 125/11, 152/11, 111/12, 68/13, 110/15, 40/19 and 34/22; hereinafter: CA) and provision of Article 22 of the Accounting Act (Official Gazette no. 78/15, 134/15, 120/16, 116/18, 42/20, 47/20; hereinafter: AA), the Management Board of company ZAGREB STOCK EXCHANGE Inc., Zagreb, Ivana Lučića 2a (hereinafter: the Company), on 29 April 2024, issued the following STATEMENT on the application of the Corporate Governance Code
In accordance with Code requests, and pursuant to provisions of the Companies Act and Capital Market Act (Official Gazette no. 65/18, 17/20; hereinafter: CMA), the Supervisory Board conducts internal supervision of the Company by conducting regular controls of prepared reports. Members of the Supervisory Board receive on regular basis detailed information on management and work of the Company. All issues under the competence of the Supervisory Board, as prescribed by the CA, CMA and Articles of Association of the Company, are discussed and decided upon in the Supervisory Board meetings. Supervisory Board Report is part of the Company's Annual Report presented to the General Assembly. In addition, the Supervisory Board performs internal controls and supervision through Audit Board that provides expert support to the Supervisory Board and the Management Board in the efficient execution of obligations relating to corporate governance, risk management, financial reporting and control of the Company.The Management Board is bound to monitor that the Company keeps business books and other books and business documents, prepares book-keeping documents, provides realistic assessments of the assets and liabilities, drafts financial and other reports in accordance with accounting regulations and standards and applicable laws and regulations.
Top ten shareholders on 31 December 2023:
| Shareholder | No. of shares | Ownership % |
|---|---|---|
| FINA | 231,553 | 9.9900% |
| RR ONE CAPITAL d.o.o. | 231,553 | 9.9900% |
| PBZ CO OMF | 231,400 | 9.9834% |
| INTERKAPITAL D.D. | 199,750 | 8.6179% |
| BAKTUN, LLC | 182,478 | 7.8727% |
| EBRD | 120,000 | 5.1772% |
| INSPIRIO ZAIF d.d. | 114,000 | 4.9184% |
| OTP BANKA d.d. | 105,900 | 4.5689% |
| HPB d.d. | 92,300 | 3.9821% |
| ERSTE & STEIRMARKISCHE BANK d.d. | 76,400 | 3.2962% |
| Others | 732,246 | 31.6032% |
| Total | 2,317,580 | 100.0000% |
Pursuant to the Articles of Association of the Company, shareholder's voting rights are not limited to a certain percentage or number of votes, and there are no time limitations for acquisition of voting rights. Each ordinary share provides a right to one vote in the General Assembly. Rights and obligations of the Company deriving from the acquisition of own shares are met in accordance with the provision of the CA. On December 31, 2023, the Company owns a total of 8,396 of own shares, which make up for 0.3611% of the Company’s total issued share capital.
Activities of the Supervisory Board in 2023 included:
* Adoption of the consolidated and unconsolidated quarterly, biannual and annual financial reports of the Company,
* Approving of amendments to the Company's Rules of procedure and other strategic documents,
* Receiving information from the Management Board of the Company and the Group's subsidiaries
* Electing the vice-president of the Supervisory Board, members of the Audit, Strategy and Remuneration Committees,
* Deciding on the date, agenda and proposals of resolutions of the Company's General Assembly,
* Approving the annual Code of Corporate Governance Questionnaire
* Adopting the yearly Internal Audit Plan,
* Deciding on suitability of the members of the Management Board
* Approving the Company's Business Plan and Buget
* Determining of the full text of the Company's Articles of Association
During 2023, the Supervisory Board held a total of six meetings, attended by members:
* Matko Maravić, president (100%)
* Tomislav Jakšić, vice president (100%)
* Dražen Čović (50%)
* Bente Avnung Landsnes (100%)
* Silvije Orsag (100%)
* Ivan Sardelić (100%)
The composition of the the Management and Supervisory Boards in 2023 includes members of different genders, age, profiles and experience in order to ensure diverse perspectives in decision-making. The Company intends to bring to attention the need to increase the number of women in the Supervisory Board in the future.
The Supervisory Board has established the Audit Committee composed of three members, namely: Matko Maravić, Ivan Sardelić, Silvije Orsag.
Activities of the Audit Committee in 2023 included:
* Detailed analysis of the Company's consolidated and unconsolidated quarterly, biannual and annual financial reports,
* Supervision of the Company's expenses,
* Supervision of the audit of the annual financial reports for 2022,
* Issuing recommendations to the Supervisory Board in regards to the choice of the Company's auditor,
* Issuing an opinion in regards to the Strategic and yearly Internal Audit plan.
During 2023, the Audit Committee held a total of five meetings, attended fully by all members.
The Supervisory Board has established Remuneration Committee composed of two members, namely: Matko Maravić, Tomislav Jakšić.
Activities of the Remuneration Committee in 2023 included:
* Supporting the Supervisory Board in the procedure of proposing a reward policy for the members of the Management Board,
* Proposing objective criterion to accurately assess business success which forms a base for the reward policy for the members of the Management Board,
* Issuing a proposal to the Supervisory Board regarding the reward amounts for the Management Board following the adoption of the annual financial reports,
* Issuing an opinion to the Supervisory Board regarding the Management Board’s proposal for reward payment to the Company’s employees.
During 2023, the Remuneration Committee held one meeting, attended fully by all members.
The Supervisory Board has established Strategy Committee composed of six members, namely: Dražen Čović, Matko Maravić, Bente Avnung Landsnes Silvije Orsag.
Activities of the Strategy Committee in 2023 included:
* Supporting the Management Board in development, implementation and realization of strategic goals and the Company’s strategy in general,
* Assessment, consideration and revision of the Company’s key strategic determinants,
* Construction of the proposals of the Supervisory Board for adoption of the Company’s strategic goals
* Supervision of the implementation and/or realization of the set strategic goals of the Company and regular reporting to the Management and Supervisory Boards.
During 2023, the Strategy Committee held one meeting, attended by members: Bente Avnung Landsnes and Matko Maravić.
The Supervisory Board has established Nomination Committee composed of three members, namely: Matko Maravić, Tomislav Jakšić, Silvije Orsag.
Activities of the Nomination Committee in 2023 included:
* carrying out the procedure of initial, regular and extraordinary assessment of the suitability of candidates for members of the Exchange's Management Board and Supervisory Board, and collective assessment of the Exchange's Management Board and Supervisory Board;
* identification and recommendation of candidates for filling positions in the Company's Management Board and Supervisory Board,
* assessment of the balance of knowledge, skills, diversity and experience of the members of the Management Board and Supervisory Board of the Company;
* the decision on the goal for the representation of the underrepresented gender in the Management Board and the Supervisory Board of the Exchange and the preparation of a policy on how to increase the number of representatives of the underrepresented gender in the Management Board and the Supervisory Board of the Company;
* regular evaluation of the structure, size, composition and performance of the Company's Management Board and Supervisory Board;
* regular evaluation of the knowledge, skills and experience of individual members of the Management Board and the Supervisory Board as a whole and reporting to the Management Board and the Supervisory Board of the Company.
During 2023, the Nomination Committee held a total of three meetings, attended by members:
* Matko Maravić (100%)
* Tomislav Jakšić (100%)
* Silvije Orsag (67%).
In 2023, the Supervisory Board of the Zagreb Stock Exchange (hereinafter: the Stock Exchange and/or the Company) held a total of six (6) sessions on the following dates: February 22, April 26, July 25, September 12, 24 October, December 4 and December 8, 2023. At the meetings of the Supervisory Board, the entire business of the company was considered, which includes current and preventive supervision. Members of the Company's Management Board also participated in the sessions of the Supervisory Board, presenting individual business areas and providing the necessary clarifications to the Supervisory Board. In this regard, the Supervisory Board assesses its cooperation with the Management Board as very successful. During the supervision, the Supervisory Board paid particular attention to the examination of the legality of the business, both in the part of acting in accordance with the valid legal framework, and in relation to acting in accordance with the provisions of the Company's Articles of association.
The Supervisory Board adopted all reports of the Management Board submitted during 2023, and concludes that the achieved results are within the expectations and in accordance with the current economic environment. The Supervisory Board points out that according to the best knowledge and based on the data provided, the business data presented correspond to the situation shown in the business books of the Stock Exchange, as well as that they represent an objective, complete and true presentation of the Company's assets and liabilities. The Supervisory Board fully and unreservedly accepts the conclusion of the Management Board that the preparation of financial statements based on the principle of going concern is appropriate.
Pursuant to provisions of Article 250a, paragraph 4 and Article 272, paragraph of the CA, and Article 22 of the AA, this Statement is a special section and integral part of the Company's Annual Report for 2023.# Responsibilities of the Management Board for the Annual report
The Management Board of the Company is required to prepare financial statements for each financial year, which give a true and fair view of the financial position of the Company and of the results of its operations and cash flows, in accordance with International Financial Reporting Standards as adopted by the European Union. The Management Board is responsible for implementing and maintaining proper accounting records relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. The Management Board has general responsibility for taking such steps as are reasonably available to it to safeguard the assets of the Company and to prevent and detect fraud and other irregularities. The Management Board is responsible for selecting suitable accounting policies to conform to applicable accounting standards and then applying them consistently; making judgments and estimates that are reasonable and prudent; and preparing the financial statements on a going concern basis unless it is inappropriate to presume that the Company will continue in business. The Management Board is also responsible for the preparation and content of the Management report and the statement of implementation of the Corporate Governance Code, as required by the Croatian Accounting Act (Official Gazette 78/15, 134/15, 120/16, 116/18, 42/20, 47/20), and the rest of other information (together “other information”). The Management Board is responsible for the submission of the Annual report to the Supervisory Board which includes the financial statements and other information for acceptance, following which the Supervisory Board is required to consider, and if appropriate approve the annual financial statements for submission to the General Assembly for adoption. The financial statements and other information are approved by the Management Board on April 29, 2024 and are signed and verified for submission to the Supervisory Board.
Signed on behalf of the Zagreb Stock Exchange, Inc.:
| Note | 2023 | 2022 |
|---|---|---|
| EUR | EUR | EUR |
| Profit and loss account | ||
| Sales revenue | 4 | 1,299,319 |
| Other operating income | 5 | 718,425 |
| Staff costs | 6 | (1,002,235) |
| Depreciation and amortization | 10,11, 12 | (207,741) |
| Other operating costs | 7 | (841,487) |
| Profit (loss) from operations | (33,719) | |
| Financial income | 8 | 155,601 |
| Financial expenses | 8 | (10,260) |
| Net gains/(losses) from fair value from financial assets through profit and loss | 8 | 26,533 |
| Net foreign exchange gain/(loss) | 8 | (122) |
| Net financial income (expenses) | 171,752 | |
| Profit before tax | 138,033 | |
| Income tax expense | 9 | (1,830) |
| Profit for the year | 136,203 | |
| Other comprehensive income, net of income taxes | ||
| Items that cannot be reclassified to income statement | ||
| Changes in the fair value of equity investments at fair value through other comprehensive income | 14, 15 | 112,040 |
| Other comprehensive income, net of tax | 9 | (20,168) |
| Total comprehensive income for the year | 228,075 | |
| Basic and diluted earnings per share (HRK) | 21 | 0.06 |
The accounting policies and other notes form an integral part of these separate financial statements.
| Note | 31.12.2023 | 31.12.2022 (corrected) | 1.1.2022 (corrected) |
|---|---|---|---|
| EUR | EUR | EUR | EUR |
| Assets | |||
| Non-current assets | |||
| Equipment | 10 | 166,323 | 210,393 |
| Intangible asset | 11 | 197,756 | 219,864 |
| Right-of-use assets | 12 | 232,515 | 332,519 |
| Investment in subsidiary | 13 | 2,538,382 | 2,538,382 |
| Investment in associate and joint venture | 14 | 1,262,599 | 1,261,399 |
| Financial assets at fair value through other comprehensive income | 15 | 145,916 | 26,163 |
| Long term deposits | 19 | 33,166 | 33,166 |
| Loans given to related parties | 18 | 27,381 | 28,881 |
| Deferred tax assets | 9 | - | 15,458 |
| Total non-current assets | 4,604,038 | 4,666,225 | |
| Current assets | |||
| Trade receivables and other assets | 16 | 334,437 | 269,984 |
| Contract assets | 5a | - | 13,119 |
| Financial assets at fair value through profit or loss | 15b | 736,505 | 1,191,398 |
| Short-term deposits | 19 | 1,126,162 | 8,136 |
| Inventories | - | - | |
| Cash and cash equivalents | 17 | 114,249 | 667,895 |
| Prepaid expenses | 13,629 | 13,619 | |
| Total current assets | 2,324,982 | 2,164,151 | |
| Total assets | 6,929,020 | 6,830,376 |
The accounting policies and other notes form an integral part of these separate financial statements.
| Note | 31.12.2023 | 31.12.2022 (corrected) | 1.1.2022 (corrected) |
|---|---|---|---|
| EUR | EUR | EUR | EUR |
| Equity, reserves and liabilities | |||
| Equity and reserves | |||
| Issued share capital | 20 | 3,076,315 | 3,076,316 |
| Share premium | 1,840,833 | 1,839,562 | |
| Legal reserves | 18,714 | 18,714 | |
| Own shares | 20 | (30,483) | (18,409) |
| Other reserves | 20 | 815,878 | 815,878 |
| Reserve - fair value financial assets | 162,041 | 70,169 | |
| Accumulated profit (loss) | 144,650 | 16,893 | |
| Total equity and reserves | 6,027,948 | 5,819,123 | |
| Long term liabilities | |||
| Lease liabilities | 12 | 134,348 | 230,548 |
| Deferred tax liability | 9 | 6,540 | - |
| Total long-term liabilities | 140,888 | 230,548 | |
| Current liabilities | |||
| Trade and other payables | 22 | 198,630 | 200,390 |
| Lease liabilities | 12 | 96,200 | 93,057 |
| Contractual liabilities | 5 | 465,354 | 487,258 |
| Total current liabilities | 760,184 | 780,705 | |
| Total equity, reserves and liabilities | 6,929,020 | 6,830,376 |
The accounting policies and other notes form an integral part of these separate financial statements.
| Issued capital | Share premium | Legal reserves | Own shares | Other reserves | Reserve – fair value | Accumulated profit (loss) | Total | |
|---|---|---|---|---|---|---|---|---|
| EUR | EUR | EUR | EUR | EUR | EUR | EUR | EUR | EUR |
| As at 1 January 2022 | 6,164,128 | 1,843,000 | 18,749 | - | - | - | (2,264,579) | 5,761,298 |
| Current year profit | - | - | - | - | - | - | 16,900 | 16,900 |
| Other comprehensive income (Note 14) | - | - | - | - | - | 70,196 | - | 70,196 |
| Total other comprehensive income | - | - | - | - | - | 70,196 | 16,900 | 87,096 |
| Other equity movements | ||||||||
| - decrease of issued capital (Note 20 a) | (3,077,506) | - | - | - | 3,077,506 | - | - | - |
| - covering the transferred loss from other reserves (Note 20 b) | - | - | - | - | (2,261,230) | - | 2,261,230 | - |
| - acquisition of own shares (Note 20 c) | - | - | - | (18,416) | (82) | - | - | (18,498) |
| - change of the functional currency (Note 28) | (10,306) | (3,438) | (35) | 7 | (316) | (27) | 3,342 | (10,773) |
| Total other equity movements | (3,087,812) | (3,438) | (35) | (18,409) | 815,878 | (27) | 2,264,572 | (29,271) |
| As at 31 December 2022 | 3,076,316 | 1,839,562 | 18,714 | (18,409) | 815,878 | 70,169 | 16,893 | 5,819,123 |
| Current year profit | - | - | - | - | - | - | 136,203 | 136,203 |
| Other comprehensive income (Note 15) | - | - | - | - | - | 91,872 | - | 91,872 |
| Total other comprehensive income | - | - | - | - | - | 91,872 | 136,203 | 228,075 |
| Other equity movements | ||||||||
| - share based payments (Note 20c) | - | 1,271 | - | 5,182 | - | - | (8,446) | (1,993) |
| - acquisition of own shares (Note 20 c) | - | - | - | (17,256) | - | - | - | (17,256) |
| - decrease of issued capital (Note 20a) | (1) | - | - | - | - | - | - | (1) |
| Total other equity movements | (1) | 1,271 | - | (12,074) | - | - | (8,446) | (19,250) |
| As at 31 December 2023 | 3,076,315 | 1,840,833 | 18,714 | (30,483) | 815,878 | 162,041 | 144,650 | 6,027,948 |
The accounting policies and other notes form an integral part of these separate financial statements.
| Note | 2023 | 2022 |
|---|---|---|
| EUR | EUR | EUR |
| Cash flow from operating activities | ||
| Profit before tax | 138,033 | |
| Depreciation and amortization | 10,11,12 | 207,741 |
| Unrealized (profit)/loss from financial assets at fair value through profit and loss | 8 | (14,433) |
| Loss / (profit) from sale of financial assets at fair value through profit and loss | 8 | (12,100) |
| Dividends income | 8 | (138,622) |
| Interest income | 8 | (16,834) |
| Interest expense | 8,12 | 10,260 |
| Net foreign exchange loss/(profit) | - | |
| Other adjustments | - | |
| Cash flow before changes in operating assets and liabilities | 174,045 | |
| Changes in operating assets and liabilities | ||
| Decrease/(increase) in trade receivables | (50,785) | |
| (Increase)/decrease in prepaid expenses | (10) | |
| Inventory reduction | - | |
| (Decrease) / increase in liabilities to suppliers and other liabilities | (2,518) | |
| Increase in contractual obligations and accrued expenses | (21,904) | |
| Change in operating assets and liabilities | (75,217) | |
| Interest paid | (9,502) | |
| Income tax | 9 | - |
| Net cash inflow/(outflow) from operating activities | 89,326 |
The accounting policies and other notes form an integral part of these separate financial statements.# Zagreb Stock Exchange Inc., Zagreb Unconsolidated financial statements for the year ended 31 December 2023
| 2023 | 2022 | |
|---|---|---|
| EUR | EUR | EUR |
| Cash flow from investing activities | ||
| Cash outflow for purchase of tangible non-current assets | (21,502) | (114,172) |
| Cash outflow for purchase of intangible non-current assets | (20,057) | (117,710) |
| Cash outflow for purchase of financial assets at fair value through profit and loss | - | (100,152) |
| Cash outflow for purchase of financial assets at fair value through other comprehensive income | (7,713) | - |
| Cash outflow for investments in associated companies | (1,200) | (958,195) |
| Cash outflow for bank deposits | (1,101,741) | (8,139) |
| Cash inflow from refund of deposits | - | 598,340 |
| Cash inflow form sale of financial assets at fair value through profit and loss | 481,426 | 735,476 |
| Cash outflow for acquisition of own shares | (17,256) | (18,416) |
| Cash outflow for dividends paid | (1,994) | - |
| Cash inflow from refund of borrowings | 1,500 | - |
| Dividends received | 138,622 | 55,819 |
| Interest received | - | 872 |
| Net cash (outflow)/inflow from investing activities | (549,915) | 73,723 |
| Cash flow from financing activities | ||
| Repayment of lease liabilities | (93,057) | (97,982) |
| Net expenditures on financing activities | (93,057) | (97,982) |
| Net (decrease)/increase in cash and cash equivalents | (553,646) | 223,573 |
| Cash and cash equivalents at the beginning of the year | 667,895 | 446,181 |
| Effects of exchange rate changes on cash and cash equivalents | - | (1,859) |
| Cash and cash equivalents at the end of the year | 114,249 | 667,895 |
The accounting policies and other notes form an integral part of these separate financial statements.
Zagrebačka burza d.d. (“Zagreb Stock Exchange” or “the Company”) is domiciled in Republic of Croatia and registered at the Commercial Court in Zagreb on 5 July 1991. The address of the Company’s registered office is Eurotower, 22nd floor, Ivana Lučića 2a/22, Zagreb, Croatia. During 2023, there were no changes in the name of the Company or any other way of designating the reporting entity. The business activities of the Company include: management of the regulated market; collection, processing and publishing of trading data; management of Multilateral Trading Facility; development, maintenance and disposition of computer software used for management of the regulated market and collection, processing and publishing of the data on securities trading; organizing and providing professional trainings for participants of capital markets. At the year end the Company was owned by 195 shareholders (31 December 2022: 184 shareholders). The Company does not have an ultimate parent company. As of 31 December 2023, and 31 December 2022 the Zagreb Stock Exchange is the owner of Ljubljanska borza d.d. (“Ljubljana Stock Exchange”) and has an investment in a joint venture SEE Link Ltd Skopje, Republic of North Macedonia and investments in the associate companies Makedonska Berza a.d., Skopje, Republic of North Macedonia, Funderbeam South-East Europe Ltd, Zagreb, Croatia and Adria Digital Exchange Ltd, Zagreb, Hrvatska. The activities of the Company are regulated by Croatian Agency for Supervision of Financial Services – Hrvatska agencija za nadzor financijskih usluga (“HANFA”). These financial statements comprise of separate financial statements of the Company as defined by International Accounting Standards 27 Separate Financial Statements. Zagrebačka burza Group prepares consolidated financial statements, which are published as a separate document.
These financial statements have been prepared in accordance with International Financial Reporting Standards as adopted by the European Union („IFRS“). These financial statements were authorized for issue by the Management Board on 29. April 2024 for submitting for approval by the Supervisory Board.
The following amendments to the existing standards, in effect as of 1 January 2023, are adopted by the EU, but had no significant effect on the Company:
Several new standards and interpretations have been published that are mandatory for annual periods beginning on or after January 1, 2024, that have been adopted by the EU and that the Company has not previously adopted.
Unless otherwise stated above, the new standards and interpretations are not expected to significantly affect the Company's financial statements.
Several new standards and interpretations have been published that are mandatory for annual periods beginning on or after January 1, 2024, or later, which have not been adopted by the EU and which the Company has not previously adopted.
Unless otherwise stated above, the new standards and interpretations are not expected to significantly affect the Company's financial statements.
The financial statements have been prepared on the historical cost basis, except for financial assets at fair value through profit or loss and financial assets at fair value through other comprehensive income.
On January 1, 2023, the official monetary currency and official means of payment in the Republic of Croatia became the euro ("EUR") instead of the Croatian kuna ("HRK"). The introduction of the euro as the official currency in the Republic of Croatia represents a change in the functional currency. On January 1, 2023, all items of assets, liabilities and capital were converted from HRK to EUR using a fixed conversion rate determined by the Croatian government, which was HRK 7.53450 for EUR 1. The change in the functional currency is applied prospectively from the specified date.
In these financial statements, the presentation currency has also been changed, and comparative periods are presented in euros. Since the financial statements of the previous period were presented in Croatian kuna, the change in the presentation currency of the comparative period in this year's financial statements represents a change in the Company's accounting policy. With regard to the change in accounting policy, the Company presents three reports on the financial position in this year's financial statements: as of January 1, 2022, December 31, 2022, and December 31, 2023. The conversion rate from January 1, 2023, which is HRK 7.53450 for 1 euro, was applied to the balances in the statement of financial position as of December 31, 2022. The conversion rate for the amounts in the statement of financial position as of January 1, 2022 is HRK 7.520447 for 1 euro and represents the average exchange rate published by the Croatian National Bank on that date. The average annual exchange rate for the year 2022 published by the Croatian National Bank was HRK 7.531585 for 1 euro and was used to convert the items of the statement of comprehensive income, changes in capital and cash flows for the year 2022.# Exchange rate differences that arose before January 1, 2023, and refer to the change in the presentation currency, are reclassified within equity from other comprehensive income to retained earnings. All financial data are presented in EUR unless otherwise stated.
The preparation of financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of policies and the reported amounts of assets and liabilities, income and expenses. Estimates and related assumptions are based on historical experience and various factors that are believed to be reasonable under the circumstances and the information available at the date of preparation of the financial statements. Their result represents the basis for determination of book value of assets and liabilities which is not easily identifiable from other sources. Actual results may differ from these estimates. Estimates and assumptions are reviewed on a regular basis. Changes in accounting estimates are recognized in the period in which the estimate is changed and in future periods, if the change affects them as well. Information on significant sources of uncertainty and key judgments in applying accounting policies that have a significant effect on the amounts reported in the financial statements are described in Note 26.
Transactions in foreign currencies are converted into the functional currency at the exchange rate valid on the day of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated to functional currency at the rate of exchange at the date of reporting. Foreign exchange gains or losses on monetary items represent the difference between the amortized cost in the functional currency at the beginning of the year, adjusted for effective interest and year-round payments, and the amortized cost in the foreign currency at the rate of exchange at the date of reporting. Non-monetary assets and liabilities measured at fair value in foreign currency are translated to functional currency at the rate of exchange at the date on which their fair value was determined. Non-monetary items that are measured based on historical cost in foreign currency are translated at the rate of exchange at the date of the transaction.
48
Zagreb Stock Exchange Inc., Zagreb
Unconsolidated financial statements for the year ended 31 December 2023
Notes to the financial statements (continued)
Foreign exchange differences arising from translation of foreign currency into functional currency are recognized in the income statement. Alongside euro, the most significant currency of Company’s assets and liabilities is Macedonian dinar (MKD). The exchange rate used for conversion on 31 December 2023 was 1 EUR = MKD 0.016261 (31 December 2022: 1 EUR = MKD 0.16262).
Equipment mainly includes computers and office equipment, furniture and telephone equipment. Intangible assets include licenses for computer programs capitalized on the basis of costs incurred in acquiring and putting into use of a particular program.
Recognition and measurement
Equipment and intangible assets are stated at historical cost reduced by accumulated depreciation and impairment losses. Historical cost includes costs that are directly attributable to the acquisition of the asset.
Subsequent costs
Subsequent costs are recognized in the carrying amount of the asset or as a separate item only, if it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. All other repairs and maintenance are an expense in the period in which they are incurred.
Amortization / Depreciation
Amortization / depreciation is recognized in the income statement on a straight-line basis over the estimated useful lives of certain items of property and equipment. Assets under construction are not depreciated. The estimated useful lives are shown below and have not changed from the previous year:
Depreciation methods and useful lives are reviewed, and modified if appropriate, at each reporting date. The carrying amount of an asset is reduced to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount. Gains and losses on disposals are determined by comparing proceeds with carrying amount and are included in the income statement.
49
Zagreb Stock Exchange Inc., Zagreb
Unconsolidated financial statements for the year ended 31 December 2023
Notes to the financial statements (continued)
Classification
In its portfolio, the Company holds financial assets classified as assets at amortized cost, assets at fair value through other comprehensive income (FVOCI) and assets at fair value through profit or loss (FVTPL).
Financial assets at amortized cost
This category includes loans to related parties, trade receivables, cash and cash equivalents and placements with banks.
Financial assets at fair value through other comprehensive income
A debt instrument is measured at fair value through other comprehensive income if it meets both of the following conditions and if it is not measured at fair value through profit or loss (FVTPL):
Upon initial recognition of investments in equity instruments that are not held for trading, the Company may irrevocably choose to disclose subsequent changes in fair value through other comprehensive income. This choice is made on the basis of individual investment.
Financial assets at fair value through profit or loss
All other financial assets are classified as financial assets at fair value through profit or loss. In addition, on initial recognition, the Company may irrevocably measure financial assets at fair value through profit or loss, although it meets the requirements for measurement at amortized cost or at fair value through other comprehensive income, if this eliminates or significantly reduces accounting mismatches that would otherwise occur.
Financial liabilities
The Company measures all financial liabilities at amortized cost, which includes other liabilities.
Reclassification
Financial assets are not reclassified after initial recognition, except in the period after the change in the financial asset management business model.
Business model evaluation
Shares in the investment funds are measured at fair value are measured at fair value through profit or loss because they are not held for the purpose of collecting contracted cash flows or for collecting contractual cash flows and for sale.
50
Zagreb Stock Exchange Inc., Zagreb
Unconsolidated financial statements for the year ended 31 December 2023
Notes to the financial statements (continued)
Recognition and derecognition
Financial assets and financial liabilities at fair value through profit or loss are recognized on the trade date, i.e., the date on which the Company commits to purchase or sell the asset. Loans and receivables and other financial liabilities measured at amortized cost are recognized when the financial asset is transferred to the borrower, or the liability is received from the lender.
The Company derecognizes a financial asset (in whole or in part) when the rights to receive cash flows from the financial asset expire or when it loses control over the contractual rights to the financial asset. This occurs when the Company substantially transfers all risks and rewards of ownership to another entity or when rights are exercised, transferred or expired.
The Company ceases to recognize financial liabilities only when they cease to exist, i.e., when they are fulfilled, canceled, expired or significantly changed (10% change test). If the terms of the financial liability change, the Company will derecognize that liability and begin recognizing the new financial liability with the new terms.
Cumulative gain or loss recognized in comprehensive income from equity securities under the FVOCI option is not recognized in the income statement upon derecognition of such securities. All interest on transferred financial assets that meet the conditions for derecognition are recognized by the Company as a separate asset or liability. Investments in shares listed and described in Note 15 a) are valued under the FVOCI option. In accordance with IFRS 9, the Company decided to value these investments in shares under the FVOCI option as it does not hold these shares for trading. The fair values of these investments are disclosed in Note 15 a).
Initial and subsequent measurement
Financial assets and liabilities are initially recognized at fair value plus, in the case of financial assets and financial liabilities not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial asset or financial liability. Transaction costs for financial assets at fair value through profit or loss are recognized immediately as profit or loss, while for other financial instruments they are amortized. All financial assets at fair value through profit or loss are subsequently stated at fair value.# Zagreb Stock Exchange Inc., Zagreb Unconsolidated financial statements for the year ended 31 December 2023
Loans and receivables are stated at amortized cost reduced by impairment losses and other financial liabilities at amortized cost. Amortized cost is calculated using the effective interest rate method. Premiums and discounts, including initial transaction costs, are included in the carrying amount of the related instrument and amortized based on the effective interest rate of the instrument.
Principles of measuring fair value
The fair value of financial assets at fair value through profit or loss is the quoted market price in an active market at the reporting date, net of selling expenses. The Company reviews each financial instrument separately to determine whether the financial instrument is quoted in an active market.
Fair value levels
The Company uses following levels to determine the fair value of financial instruments:
Impairment of financial assets
Financial instruments
For credit exposures for which there has been no significant increase in credit risk since initial recognition, expected credit losses are recognized for credit losses arising from the probability of default in the next 12 months. For those credit exposures where there has been a significant increase in credit risk since initial recognition, an adjustment is required for expected credit losses over a lifetime, regardless of the time of borrowing.
For trade receivables and contractual assets, the Company applies a simplified approach to the calculation of expected credit losses and therefore does not monitor changes in credit risk but recognizes impairment based on lifelong expected credit loss at the end of each reporting period.
The Company writes off financial assets when there are indications that the debtor is in serious financial difficulty, that there is no realistic prospect of recovery or that the debtor is likely to go bankrupt or otherwise undergo financial reorganization or restructuring. Depreciated financial assets may still be subject to collection activities of the Company.
Expected credit losses on trade receivables are estimated on the basis of the arrears matrix, taking into account the historical experience of the occurrence of the default status of the debtor and the analysis of the current financial position of the debtor. In estimating expected credit losses, the Company considers reasonable information that is relevant and available. This includes quantitative and qualitative information and analysis, based on the Company's historical experience and informed creditworthiness assessment, including information relating to the future.
The Company considers that financial assets are not recoverable if it is unlikely that the debtor will pay its obligations to the Company in full without the Company having to initiate actions such as activating collateral (if any). The maximum period that is taken into account when estimating the expected credit loss is the maximum contracted period during which the Company is exposed to credit risk.
The Company recognizes a gain or loss in the income statement for all financial instruments with an appropriate adjustment to the carrying amount through the provision for expected credit losses.
Measuring expected credit losses
Expected credit losses are estimates of the weighted probabilities of credit losses. Credit losses are measured as the present value of all cash losses (the difference between the cash flows to which the Company is entitled under the contract and the cash flows that the Company expects to actually receive). Expected credit losses are discounted at the effective interest rate of the financial assets in question. There were no changes in valuation techniques or significant assumptions during the current reporting period.
Trade receivables, other assets, short-term deposits with banks and loans granted to associates
Trade receivables, other assets, short-term deposits with banks and loans to associates are initially recognized at fair value plus transaction costs, and subsequently at amortized cost reduced by any impairment losses.
Investments in funds
Investments in open-end and closed-end investment funds are classified as financial assets at fair value through profit or loss and are measured at fair value.
Trade and other payables
Trade and other payables are initially recognized at fair value and subsequently measured at amortized cost.
The net carrying amount of the Company's assets is reviewed at each reporting date to determine whether there is any indication of impairment. If such indications are identified, the recoverable amount of the asset is estimated. The recoverable amount is estimated at each reporting date for intangible assets that are not yet in use. Depreciable assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognized whenever the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. An impairment loss is recognized in the income statement.
Non-financial assets that have suffered impairment are reviewed for possible reversal of the impairment loss at each reporting date. An impairment loss is reversed if there has been a change in the estimate used to determine the recoverable amount, but not exceeding the carrying amount of the asset that does not exceed the carrying amount that would have been determined, net of depreciation, had there been no impairment.
The Company is a lessor
Assets given under business leases are depreciated over an expected life same as other similar assets. Leases in which the Company is a lessor are classified as financial or operating leases. The lease is classified as a financial lease if it transmits almost all the risks and benefits associated with ownership of the respective property to the lessee. All other leases are classified as operating leases.
When the Company is an intermediate lessor, it calculates the main lease and sub-lease as two separate contracts. The sub-lease is classified as a financial or operating lease by reference to the right-of-use property resulting from the main lease.
Assets given under operating lease are depreciated over their expected useful life in the same way as other similar assets. Income from rents based on operating leases is recognized in a straight line during the period of the lease in question. The initial direct costs incurred at the stage of negotiating and arranging the terms of the operating lease shall be attributed to the book amount of the subject matter of the lease and recognized in a straight line during the rental period.
Receivables based on financial leases are recorded as receivables in the Company's net investment in leases. Financial lease income is allocated to accounting periods to reflect a constant periodic rate of return on the open balance of the Company’s net investment based on leases.
When the contract covers components relating to leases and non-rental components, the Company applies IFRS 15 to distribute the fee in accordance with the contract for each component. The Company assesses whether it is a lease agreement or whether the contract contains a lease, at the beginning of the contract.
The Company shall disclose the right-to-use assets and the corresponding lease liability with regard to all leases in which it is lessee, except for short-term leases (defined as leases with a duration of 12 months or less) and leases of low value assets (such as tablets and personal computers, office furniture and telephones). For such leases, the Company rectilinearly recognizes rental payments as operating expenses for the duration of the lease, unless another systematic basis better reflects the time dynamics of spending the economic benefits of the assets held in the lease.
The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted by using the rate implicit in the lease. If this rate cannot be readily determined, the lessee uses its incremental borrowing rate.
Lease payments included in the measurement of the lease liability comprise:
54
Zagreb Stock Exchange Inc., Zagreb
Unconsolidated financial statements for the year ended 31 December 2023
Notes to the financial statements (continued)
d) Leases (continued)
The Company did not make any such adjustments during the periods presented. The right-of-use assets comprise the initial measurement of the corresponding lease liability, lease payments made at or before the commencement day, reduced by any lease incentives received and any initial direct costs. They are subsequently measured at cost reduced by accumulated depreciation and impairment losses. When the Company bears the costs of dismantling and removing the leased assets, renovating the place where the property is located, or returning the underlying assets to the state required under the terms of the lease, the provision shall be recognized and measured in accordance with IAS 37. If costs relate to right-of-assets, the costs are included in the associated right-of-use assets, unless those costs are incurred in the production of inventory.
Right-of-use assets are depreciated through the lease period or life of use, whichever is shorter. If, on the basis of the lease, ownership of the underlying property is transferred or if the cost of the right-of-use property reflects that the Company will take advantage of the purchase option, the right-to-use asset is depreciated through the useful life of the underlying asset. Depreciation starts at the start date of the lease. The Company applies IAS 36 to determine whether the value of the right-to-use property is impaired or whether any impairment losses have been calculated for it, as described in the policy "Equipment and intangible assets".
Variable rents that do not depend on the index or rate are not covered by the measurement of the lease liability and the right-to-use assets. Related payments are recognized as costs in the period in which the event or the condition that triggered the payments in matter incurred and are presented in 'Other costs' in profit and loss.
As a practical solution, IFRS 16 allows the lessee to not provide non-rental components and to calculate components related to rent and non-rental components as a single component. The Company didn't use that practical solution. For a contract containing a lease-related component and one or more additional non-lease-related components, the Company is required to distribute the fee under the contract to each component relating to the lease based on the relative standalone price of that component and the total standalone price of non-rental components.
e) Cash and cash equivalents
Cash and cash equivalents for the purpose of preparation of cash flow statements and the statement of financial position comprise giro accounts, cash in hand and short-term deposits with banks with original maturity up to three months.
f) Earnings per share
The Company presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS are calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period. Diluted EPS are determined by adjusting the profit or loss attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares.
g) Employee benefits
i) Defined contribution pension plans
Obligations for contributions to defined contribution pension plans are recognized as an expense in income statement of the period in which they have been incurred.
55
Zagreb Stock Exchange Inc., Zagreb
Unconsolidated financial statements for the year ended 31 December 2023
Notes to the financial statements (continued)
g) Employee benefits (continued)
ii) Short-term employee benefits
Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided. A liability is recognized for the amount expected to be paid under short-term cash bonus or profit-sharing plans if the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.
h) Taxation
Income tax charge is based on taxable profit for the year and comprises of current and deferred tax. Income tax is recognized in profit or loss except to the extent that it relates to items in other comprehensive income. Current tax is the expected tax payable on the taxable income for the year, using the tax rates enacted at the reporting date, and considering the adjustments to tax payable in respect of positions from previous years.
Deferred taxes are calculated using the balance sheet method. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Deferred tax assets and liabilities are measured using the tax rates expected to be applied to taxable profit in the years in which those temporary differences are expected to be realized, or settled, based on tax rates enacted at the reporting date. Deferred tax assets and liabilities are not discounted and are classified as non-current assets and/or liabilities in the statement of financial position. Deferred tax assets are recognized when it is probable that sufficient taxable profits will be available against which the deferred tax assets can be utilized.
The company forms a tax liability in accordance with Croatian law. The income tax rate for 2023 is 18% (2022: 18%).
i) Provisions
A provision is recognized if, as a result of a past event, the Company has a present legal or constructive obligation which can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting expected future cash flows at a pre-tax rate that reflects current assessment of the time value of money and the risks specific to the liability.
j) Issued share capital, premiums and reserves
Share capital represents the nominal value of paid-in shares classified as equity and it is denominated in EUR. Share premium represents the excess of the paid amount over nominal value of the issued shares upon initial issue of shares. Any profit for the year after appropriations is transferred to retained earnings.
A legal reserve has been created in accordance with Croatian law, which requires 5% of the profit for the year to be transferred to the reserves until the total of legal reserves and capital reserves reach 5% of issued share capital. The legal reserve can be used for covering current and prior period losses in the amount of up to 5% of issued share capital.
56
Zagreb Stock Exchange Inc., Zagreb
Unconsolidated financial statements for the year ended 31 December 2023
Notes to the financial statements (continued)
k) Revenue
Revenue is measured based on the consideration specified in a contract with a customer and excludes amounts collected on behalf of third parties. The Company recognizes revenue when it transfers control of a product or service to a customer. The Company recognizes following revenues: trading commissions, membership fees, fees for the maintenance of quotations and other fees.
Commission income is recognized when the service is provided. Income from fees is deferred over the relevant period to which the fees relate. Income from maintenance of quotations, subscriptions for information and subscriptions for the real time monitoring of trade is deferred over the period of duration of the relevant quotation or subscription. Income from initial listing fees is deferred to the period in which the client has a substantive right to service.
l) Financial income
Interest income is recognized in income statement in the corresponding time period for all interest-bearing financial instruments measured at amortized cost using the effective interest rate method.
m) Dividend income
Dividends on equity instruments are recognized in profit or loss when the Company's right to receive a dividend is established.
n) Investments in subsidiaries
Subsidiaries are entities in which the Company, directly or indirectly, has control over their activities.# Zagreb Stock Exchange Inc., Zagreb
An investor controls an investee when it is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. The Company's investment in subsidiary is measured in the non-consolidated financial statements using the cost method.
o) Investments in associates and joint ventures
Associates are entities in which the Company has significant influence but no control. A significant influence is the power to participate in the financial and operating policies of entity in which the investment is made but does not constitute control or joint control of those policies. Joint ventures are companies in which two or more parties have joint control. The Company's investments in associates and joint ventures are measured in the non-consolidated financial statements using the cost method.
| 2023 | 2022 | |
|---|---|---|
| Commissions | 473,849 | 495,227 |
| Revenue from quotation maintaining | 677,682 | 685,216 |
| Revenue from quotation fee | 122,215 | 157,144 |
| Membership fees | 25,573 | 25,696 |
| Total sales revenue | 1,299,319 | 1,363,283 |
Commissions from members are charged based on value of realized transactions at the time of execution of the transaction. Commission income is recognized when the service is provided. Income from fees is deferred over the relevant period to which the fees relate. Revenue from quotation maintenance represents an annual commission for the continuation of inclusion of the securities in the Prime, Official and Regular Market quotations. Quotation fees are collected from issuers of securities on the Prime, Official and Regular Market. Income from quotation maintenance is deferred over the period of duration of the relevant quotation. Membership fees include one-time admission fee payable for acquiring the status of Exchange Member, as well as fees charged to existing members on a quarterly basis. Income from membership fees is deferred to the period in which the client has a substantive right to service.
The time schedule for recognizing sales revenue is as follows:
2023
| Commissions | Income from quotation maintaining | Income from quotation fees | Membership fees | Total | |
|---|---|---|---|---|---|
| Sales revenue | 473,849 | 677,682 | 122,215 | 25,573 | 1,299,319 |
| Time schedule of income | |||||
| - at a point in time | 473,849 | - | - | - | 473,849 |
| - over time | - | 677,682 | 122,215 | 25,573 | 825,470 |
| 473,849 | 677,682 | 122,215 | 25,573 | 1,299,319 |
2022
| Sales revenue | Total | ||||
|---|---|---|---|---|---|
| Sales revenue | 495,227 | 685,216 | 157,144 | 25,696 | 1,363,283 |
| Time schedule of income | |||||
| - at a point in time | 495,227 | - | - | - | 495,227 |
| - over time | - | 685,216 | 157,144 | 25,696 | 868,056 |
| 495,227 | 685,216 | 157,144 | 25,696 | 1,363,283 |
| 2023 | 2022 | |
|---|---|---|
| Income from sale of information | 355,160 | 327,834 |
| Income from seminars | 113,323 | 108,700 |
| Income from OTC services | 87,560 | 82,156 |
| Income from LEI | 79,213 | 64,814 |
| Income from services provided | 47,030 | 57,412 |
| Other sales income | 4,539 | 3,277 |
| Income from collected previously corrected receivables | 515 | 12,755 |
| Income from reversal of provisions | 3,475 | - |
| Other income | 27,610 | 15,630 |
| Total other operating income | 718,425 | 672,578 |
Income from sale of information and subscriptions to software, for the real time trading, is deferred over the period of subscription duration. Other revenues include income from various fees, revenue from penalties and other income. The revenue from related parties consists of revenue from providing the technical support in software maintenance and other business activities.
The time schedule of recognition of other business income from contracts with customers is as follows:
2023
| Income from sale of information | Income from seminars | Income from OTC services | Income from LEI services | Income from related parties and other sales income | Total | |
|---|---|---|---|---|---|---|
| Other operating income | 355,160 | 113,323 | 87,560 | 79,213 | 51,569 | 686,825 |
| Time schedule of income | ||||||
| - at a point in time | - | 113,323 | - | - | - | 113,323 |
| - over time | 355,160 | - | 87,560 | 79,213 | 51,569 | 573,502 |
| 355,160 | 113,323 | 87,560 | 79,213 | 51,569 | 686,825 |
2022
| Sales revenue | Total | |||||
|---|---|---|---|---|---|---|
| Sales revenue | 327,834 | 108,700 | 82,156 | 64,814 | 60,689 | 644,193 |
| Time schedule of income | ||||||
| - at a point in time | - | 108,700 | - | - | - | 108,700 |
| - over time | 327,834 | - | 82,156 | 64,814 | 60,689 | 535,493 |
| 327,834 | 108,700 | 82,156 | 64,814 | 60,689 | 644,193 |
| 2023 | 2022 | |
|---|---|---|
| Contract assets | ||
| Contract assets from sale of information | - | 13,119 |
| Contract assets | - | 13,119 |
| Contract liabilities from quotation maintenance (Note 4) | 364,805 | 375,028 |
| Contract liabilities from quotation fees (Note 4) | 46,167 | 49,365 |
| Other contract liabilities (Note 4 and 5) | 54,382 | 62,865 |
| Total contract liabilities | 465,354 | 487,258 |
i) Income recognized on the basis of a contract liabilities
The overview below presents the amounts of income recognized in the current reporting period, which refer to contract liabilities from previous years:
| 2023 | 2022 | |
|---|---|---|
| Recognized income included in the contract liabilities at the beginning of the period: | ||
| Contract liabilities from quotation maintenance | 375,028 | 364,286 |
| Contract liabilities from quotation fees | 49,365 | 65,267 |
| Other contract liabilities | 20,168 | 46,500 |
| 444,561 | 476,053 |
| 2023 | 2022 | |
|---|---|---|
| Net salaries | 543,802 | 553,974 |
| Payroll contributions | 291,847 | 294,230 |
| Payroll taxes and surtaxes | 115,638 | 117,291 |
| Other staff costs | 50,948 | 38,154 |
| Total salaries | 1,002,235 | 1,003,649 |
At the end of 2023 the company had 23 employees (2022: 25), Staff costs include EUR 160 thousand (2022: EUR 161.3 thousand) of paid contributions to mandatory pension funds out of which EUR 40.6 thousand relates to Pillar II (2022: EUR 41 thousand), Contributions are calculated as a percentage of the employee's gross salary, In 2023, bonuses in the amount of EUR 37.6 thousand were paid out (2022: EUR 34 thousand) and EUR 8.4 thousand of bonuses were paid in the treasury shares.
| 2023 | 2022 | |
|---|---|---|
| Costs of software and licenses | 323,214 | 276,222 |
| Professional services | 109,010 | 125,113 |
| Other fees and charges | 48,610 | 68,320 |
| Utility expenses | 69,844 | 63,482 |
| Fees to the regulator | 66,035 | 57,373 |
| Post and telephone services | 23,520 | 24,745 |
| Maintenance of office and equipment expenses | 21,932 | 20,792 |
| Entertainment | 21,928 | 18,069 |
| Rent of premises | 15,769 | 15,997 |
| Business travel | 22,140 | 14,248 |
| Costs for seminars and marketing | 33,501 | 25,651 |
| Write-off of intangible assets | - | 150 |
| Other expenses | 85,984 | 86,353 |
| Total other operating expenses | 841,487 | 796,515 |
Other expenses in the amount of EUR 86 thousand relate to maintenance costs, material and energy costs, insurance costs, and other costs. The fee for auditing the Company's financial statements amounted to EUR 23 thousand (2022: EUR 23 thousand). Other services refer to accounting services, legal services and other external services.
| 2023 | 2022 | |
|---|---|---|
| Dividend income | 138,622 | 55,819 |
| Interest income | 16,834 | 1,450 |
| Other financial income | 145 | 256 |
| Total financial income | 155,601 | 57,525 |
| Interest expense | (10,260) | (12,315) |
| (10,260) | (12,315) | |
| Unrealized net losses from financial assets at fair value through profit and loss | 14,433 | (83,529) |
| Realized net losses from financial assets at fair value through profit and loss | 12,100 | (11,762) |
| Net loss from financial assets at fair value through profit or loss | 26,533 | (95,291) |
| Net loss on foreign exchange differences | (122) | (3,771) |
| Net financial result | 171,752 | (53,850) |
| 2023 | 2022 | |
|---|---|---|
| Current income tax expense | - | - |
| Total income tax expense | - | - |
| Deferred taxes | ||
| Increase (decrease) of deferred tax assets for temporary tax differences | 1,830 | (15,464) |
| Total income tax expense | 1,830 | (15,464) |
| Increase of deferred tax liability for temporary tax differences for items of other comprehensive income that cannot be reclassified through profit and loss | 20,168 | - |
| Net income tax on total other comprehensive income | 21,998 | (15,464) |
| 2023 | 2022 | |
|---|---|---|
| Profit before taxes | 138,033 | 1,436 |
| Tax calculated at 18% (2022: 18%) | 24,846 | 258 |
| Non-deductible tax expenses | 3,986 | 3,448 |
| Increase of fair value of financial assets at fair value through other comprehensive income | - | 12,635 |
| Non-taxable income | (33,698) | (15,975) |
| Tax losses not recognized as deferred tax assets | - | - |
| Used losses from previous years that were not recognized as deferred tax assets | 6,696 | (15,830) |
| Total income tax | 1,830 | (15,464) |
| Deferred tax assets | Deferred tax liabilities | Net deferred tax assets (liabilities) | |
|---|---|---|---|
| EUR | EUR | EUR | |
| On January 1, 2022 | - | - | - |
| Change in the year | 15,464 | - | 15,464 |
| As of December 31, 2022 | 15,464 | - | 15,464 |
| - | - | - | - |
| On January 1, 2023 | 15,464 | - | 15,464 |
| Change in the year | (1,830) | (20,168) | (21,998) |
| As of December 31, 2023 | 13,634 | (20,168) | (6,534) |
| Deferred tax assets | Financial assets | Operating lease (IFRS 16) | Provisions | Total | |
|---|---|---|---|---|---|
| 1 January 2022 | - | - | - | - | - |
| (Decrease) / increase in deferred tax assets recognized in the profit and loss | 11,541 | 186 | 3,731 | - | 15,458 |
| 31 December 2022 | 11,541 | 186 | 3,731 | - | 15,458 |
| EUR | EUR | EUR | EUR | |
|---|---|---|---|---|
| Deferred tax assets | ||||
| 1 January 2023 | ||||
| Deferred tax assets recognized in the profit and loss | ||||
| January 2023 | ||||
| m | ||||
| # Zagreb Stock Exchange Inc., Zagreb | ||||
| ## Unconsolidated financial statements for the year ended 31 December 2023 | ||||
| ### Notes to the financial statements (continued) | ||||
| #### 14 Investments in associates and joint ventures (continued) |
The summary of financial data for SEE Link Ltd is as follows:
| 2023 | 2022 | |
|---|---|---|
| EUR | EUR | |
| Ownership share | 33.33% | 33.33% |
| Fixed assets | 12,995 | 18,771 |
| Current assets | 44,391 | 68,449 |
| Of which cash and cash equivalents | 25,762 | 37,632 |
| Total assets | 57,386 | 87,220 |
| Long term liabilities | - | - |
| Short-term liabilities | 16,731 | 34,991 |
| Of which Short-term financial liabilities | - | - |
| Total liabilities | 16,731 | 34,991 |
| Total revenue | 14,184 | 24,112 |
| Amortization | 5,770 | 5,778 |
| Net interest expense | (59) | (34) |
| Profit tax | - | - |
| Profit / (loss) of the period | (11,798) | (4,553) |
Funderbeam South-East Europe Ltd is an associated company founded in 2017. During 2018, the year in which business operations started, the Company paid an additional EUR 6 thousand to increase the share capital of Funderbeam South-East Europe Ltd. In 2020, the Company acquired a new share in the amount of EUR 3.77 thousand. The ownership share as of December 31, 2023 is 30% (December 31, 2022: 30%).
Summary of financial data for Funderbeam South-East Europe Ltd is as follows:
| 2023 | 2022 | |
|---|---|---|
| EUR | EUR | |
| Ownership share | 30% | 30% |
| Fixed assets | 16,509 | 17,035 |
| Current assets | 770 | 16,456 |
| Of which cash and cash equivalents | 438 | 15,575 |
| Total assets | 17,279 | 33,491 |
| Long term liabilities | 111,408 | 122,908 |
| Short-term liabilities | 30,207 | 38,294 |
| Of which Short-term financial liabilities | 29,854 | 29,863 |
| Total liabilities | 141,615 | 161,202 |
| Total revenue | 43,460 | 81,486 |
| Net interest income / (expense) | (2,834) | (2,781) |
| Profit tax | - | 7,172 |
| Profit / (loss) of the period | (1,359) | 2,542 |
Adria Digital Exchange Ltd is an associated company founded in 2023 with subscribed capital amounting to EUR 5 thousand out of which the Company holds share of nominal value amounting to EUR 1.2 thousand which represents 24% share of the issued capital. (December 31, 2022: 0%).
Summary of financial data for Adria Digital Exchange Ltd is as follows:
| 2023 | |
|---|---|
| EUR | |
| Ownership share | 24% |
| Fixed assets | - |
| Current assets | 4,727 |
| Of which cash and cash equivalents | 4,727 |
| Total assets | 4,727 |
| Long term liabilities | - |
| Short-term liabilities | - |
| Of which Short-term financial liabilities | - |
| Total liabilities | - |
| Total revenue | - |
| Net interest income / (expense) | - |
| Profit tax | - |
| Profit / (loss) of the period | (273) |
| 2023 | 2022 | |
|---|---|---|
| EUR | EUR | |
| a) Financial assets at fair value through comprehensive income | ||
| Investments in stocks | 142,738 | 26,163 |
| Investments in shares | 3,178 | - |
| In total | 145,916 | 26,163 |
Investments in equity instruments in the amount of EUR 145.9 thousand (31 December 2022: EUR 26.2 thousand) relate to planned long-term investments. Stocks in the amount of EUR 142.7 thousand (31.12.2022: EUR 26.2 thousand) relate to the share in capital of the company Središnje klirinško depozitarno društvo d.d. (SKDD). In 2023, the Company acquired additional stocks in the amount of EUR 4.5 thousand. On December 31, the Company performed an assessment of the fair value of the investment and accordingly increased the fair value reserves of assets valued at fair value in the amount of EUR 112 thousand. During the initial recognition, the Company decided to classify these instruments as financial assets at fair value through other comprehensive income, in accordance with IFRS 9.
| 2023 | 2022 | |
|---|---|---|
| EUR | EUR | |
| b) Financial assets at fair value through profit or loss | ||
| Shares in open-end investment funds | 736,505 | 1,191,398 |
| In total | 736,505 | 1,191,398 |
Shares in open-end investment funds are classified as fair value level 1 as at 31 December 2023 and 31 December 2022.
| 2023 | 2022 | |
|---|---|---|
| EUR | EUR | |
| Trade receivables | 222,592 | 188,592 |
| Prepayments made | 6,756 | 250 |
| Other assets | 88,879 | 78,183 |
| Receivables from the state for overpaid taxes, contributions and compensations | 16,210 | 2,959 |
| In total | 334,437 | 269,984 |
The maturity of receivables is as follows:
31 December 2023
| EUR | |
|---|---|
| Not due receivables | |
| <90 | |
| Trade receivables - gross amount | 162,610 |
| Total | 162,610 |
| Expected credit losses | - |
| Trade receivables and other assets - net amount | 162,610 |
| Rate of expected credit losses | - |
31 December 2022
| EUR | |
|---|---|
| Not due receivables | |
| <90 | |
| Trade receivables - gross amount | 145,087 |
| Contractual assets – gross amount | 13,119 |
| Total | 158,206 |
| Expected credit losses | - |
| Trade receivables and other assets - net amount | 158,206 |
| Rate of expected credit losses | - |
| 2023 | 2022 | |
|---|---|---|
| EUR | EUR | |
| Giro account in local currency (EUR) | 106,487 | 659,146 |
| Giro account in foreign bank (EUR) | 1,556 | 2,565 |
| Giro account in foreign currency (MKD) | 6,184 | 6,184 |
| Cash on hand | 22 | - |
| Total cash and cash equivalents | 114,249 | 667,895 |
| 2023 | 2022 | |
|---|---|---|
| EUR | EUR | |
| Loans given to associate | 27,381 | 28,881 |
| Total | 27,381 | 28,881 |
Loans given to associate refer to loans granted to Funderbeam South-East Europe Ltd in the amount of EUR 27.3 thousand (2022: EUR 28.9 thousand), with a one-time payment upon maturity.
| 2023 | 2022 | |
|---|---|---|
| EUR | EUR | |
| Long term guarantee deposit | 33,166 | 33,166 |
| Short term deposits with banks | 1,126,162 | 8,136 |
| Total | 1,159,328 | 41,302 |
All issued shares are authorized and fully paid ordinary shares. On 31 August 2016, all issued shares were listed on the Official Market of the Zagreb Stock Exchange. As at 31 December 2023, the Company had 195 shareholders (31 December 2022: 184 shareholders) with ownership interests in the Company ranging between 0,0001% and 9.99%.
Share number movement:
| Number of shares | Share capital in EUR | |
|---|---|---|
| January 1, 2022 | 4,635,700 | 6,152,631 |
| Regular decrease of issued share capital and consolidation of shares | (2,317,850) | (3,076,315) |
| December 31, 2022 | 2,317,850 | 3,076,316 |
| January 1, 2023 | 2,317,850 | 3,076,316 |
| Decrease of issued share capital | - | (1) |
| December 31, 2023 | 2,317,850 | 3,076,315 |
Based on the Decision of the Company's Assembly dated June 14, 2022, the share capital of the Company is reduced in a regular procedure for the purpose of transferring EUR 3,076,316 to other reserves of the Company. By undertaking the share capital reduction, the nominal value per share is reduced to the amount which is lower than the minimum nominal amount permitted under Article 163(2) of the Companies Act. Hence, the share capital is reduced in a regular procedure through a consolidation of shares (reverse split), in accordance with Article 342(4) of the Companies Act. The shares are consolidated at a ratio of 2:1 by issuing to each shareholder 1 registered share with a nominal value of EUR 1.33 for 2 shares outstanding. Based on the decision of the Company’s General Assembly dated June 12, 2023, for the purposes of aligning the Company's share capital and parts of that capital that relate to individual shares with the provisions of Article 21 of the Act on Amendments to the Companies Act ("Official Gazette" No. 114/22), all shares of the Company, ZB-R-A shares with a nominal amount were replaced for shares without a nominal amount.
On June 30, 2022, the Management Board of the Company, based on Article 7 of the Company's Statute, made a decision on covering the transferred loss in the amount of EUR 2.26 million from other reserves.
In accordance with the Resolution of the General Assembly of the Company dated June 14, 2022, by which the Company’s Management Board is authorized to acquire up to 10,000 own shares during a period of 5 years from the date of the adoption of that Resolution, the Company launched the Own Shares Buy-Back Program starting as of October 3, 2022 and lasting until October 2, 2023 at the latest. The Company acquired 10,000 of own shares until the prescribed date and additional 32 own shares were acquired in the process of regular decrease of the issued share capital. The average price of the shares acquired amounts to EUR 3.56 per share with the range from EUR 3.12 to EUR 4.00 per share.
The movements of own shares were as follows:
| Number of shares | Acquisition cost EUR | |
|---|---|---|
| On January 1, 2022 | - | - |
| Acquisition in 2022 | 5,532 | 18,416 |
| Foreign exchange differences due to the change of the functional currency | - | (7) |
| As of December 31, 2022 | 5,532 | 18,409 |
| On January 1, 2023 | 5,532 | 18,409 |
| Acquisition | 4,500 | 17,256 |
| Disposal | (1,663) | (5,182) |
| As of December 31, 2023 | 8,369 | 30,483 |
In 2023, the Company granted 1,663 own shares to members of the Company's management board, the acquisition cost of which was EUR 5.2 thousand.The income of the members of the management based on the allocated shares, including the corresponding income tax, amounted to EUR 8.4 thousand, by which the Company's retained earnings were reduced.
The calculation of earnings per share as of December 31, 2023, is as follows:
| 31.12.2023 | 31.12.2022 | |
|---|---|---|
| EUR | EUR | EUR |
| Net profit for the year | 136,203 | 16,900 |
| Weighted average number of ordinary shares over the period | 2,309,793 | 2,317,850 |
| Basic and diluted earnings per share | 0.06 | 0.01 |
Diluted earnings per share are equal to the baseline as there is no potential dilution effect from any instruments.
75 Zagreb Stock Exchange Inc., Zagreb Unconsolidated financial statements for the year ended 31 December 2023 Notes to the financial statements (continued)
| 2023 | 2022 | |
|---|---|---|
| EUR | EUR | EUR |
| Trade payables | 80,560 | 74,862 |
| Liabilities toward employees | 43,758 | 43,959 |
| VAT liabilities | 7,873 | 10,503 |
| Other current liabilities | 66,439 | 71,066 |
| Total trade and other payables | 198,630 | 200,390 |
The Company does not have significant amounts of interest-bearing assets with variable interest rates. The most significant interest-bearing asset is a loan given to an associate in the amount of EUR 27.4 thousand. The Company has no interest-bearing liabilities. The impact of changes in market interest rates on the profit and loss account of the market is therefore assessed as not significant.
As of December 31, 2023, the Company has the assets and liabilities denominated in foreign currencies as presented below:
| December 31, 2023 | December 31, 2022 | |
|---|---|---|
| MKD | EUR | |
| Cash (Note 17) | 380,282 | 6,184 |
| Net impact prior to corporate income tax | 62 | |
| Net impact after corporate income tax | 62 |
| December 31, 2023 | December 31, 2022 | |
|---|---|---|
| EUR | MKD | |
| Cash (Note 17) | 62 | 380,282 |
| Net impact prior to corporate income tax | 6,184 | |
| Net impact after corporate income tax | 6,184 |
(Note: The table structure provided in the input was ambiguous regarding the arrangement of currency and date. This interpretation assumes MKD and EUR are separate columns for each date, with "+/- 1%" being a description of the impact. If a different interpretation is intended, please clarify.)
The largest exposure to credit risk is as follows:
| 31 December 2023 | 31 December 2022 | |
|---|---|---|
| EUR | EUR | EUR |
| Cash and cash equivalents (excluding cash on hand) (Note 17) | 114,249 | 667,895 |
| Trade receivables and other assets (Note. 16) | 311,471 | 266,775 |
| Contract assets (Note 5) | - | 13,119 |
| Deposits (Note 19) | 1,159,328 | 41,302 |
| Loans given to an associate (Note 18) | 27,381 | 28,881 |
| In total | 1,612,429 | 1,017,972 |
76 Zagreb Stock Exchange Inc., Zagreb Unconsolidated financial statements for the year ended 31 December 2023 Notes to the financial statements (continued)
The Company generally does not take collateral, due to the nature of its business. Apart from loans to associates and cash in domestic banks (Notes 17, 18 and 19), the Company did not have a significant concentration of credit risk at the reporting date. The Company's credit risk is mitigated by depositing funds in various domestic banks with credit ratings from A+ to Baa+.
Concentration of credit risk of net trade receivables:
| 31 December 2023 | 31 December 2022 | |||
|---|---|---|---|---|
| EUR | % | EUR | % | |
| Companies | 176,815 | 79% | 74,018 | 58% |
| Institutional investors and brokers | 45,777 | 21% | 114,574 | 42% |
| 222,592 | 100% | 188,592 | 100% |
Price risk is a risk that the value of a financial instrument will fluctuate due to changes in market prices, caused by investment-specific factors, its issuer or factors affecting all instruments traded on the market. The Company's investments in open-end investment funds are measured at fair value with changes in fair value recognized in the income statement. Accordingly, such changes in market conditions will directly affect gains and losses on financial instruments recognized in the income statement. The Company's price risk is mitigated through the diversification of the portfolio of investments in different types of open-end investment funds, managed by different investment companies, and investments in money market funds. Assuming that all other variables remained unchanged, a decrease / increase in the market price of investment fund shares of - / + 1% on the reporting date results in a decrease / increase in profit before tax of EUR 7.4 thousand (2022: EUR 11.9 thousand).
The Company has no loans received. All trade payables range from 0 to 3 months. Liabilities for renting property refer to renting several passenger cars for a period of 3 to 5 years and real estate for a period of up to 5 years. The undiscounted maturity of operating lease liabilities is disclosed in Note 12. Cash and cash equivalents and financial assets at the reporting date are significantly higher than liabilities. Financial liabilities, which include trade and other payables, deferred income and accrued expenses, have a maturity of up to one year.
The Company defines a related party as a person directly related to its major shareholders, its subsidiary, joint venture and associate, members of the Supervisory Board and the Management Board and other executive management (together “key management”); close family members of key management; members of the Management Board and members of their immediate families, in accordance with the provisions set out in International Accounting Standard 24 “Related Party Disclosures” (IAS 24).
77 Zagreb Stock Exchange Inc., Zagreb Unconsolidated financial statements for the year ended 31 December 2023 Notes to the financial statements (continued)
During 2023, Zagreb Stock Exchange generated revenues from Ljubljana Stock Exchange in the amount of EUR 47.9 thousand (2022: EUR 57.4 thousand) and expenses in the amount of EUR 0.59 thousand (2022: EUR 0.3 thousand). Receivables from Ljubljana Stock Exchange as of December 31, 2023, amount to EUR 3.7 thousand (31 December 2022: EUR 3.6 thousand). Liabilities of the Company as of December 31, 2023, amount to EUR 592 (31 December 2022: EUR 263).
During 2023, Zagreb Stock Exchange generated revenues from Funderbeam South-East Europe in the amount of EUR 1.68 thousand (2022: EUR 3.2 thousand). Receivables from Funderbeam South-East Europe as of December 31, 2023, amount to EUR 30.8 thousand (31 December 2022: EUR 32.6 thousand).
During 2023, Zagreb Stock Exchange had expenses from SEE Link in the amount of EUR 2.7 thousand (2022: EUR 4.5 thousand). Liabilities to SEE Link as at December 31, 2023, amount to EUR 0 (December 31, 2022: EUR 0.9 thousand).
During 2023, Zagreb Stock Exchange had expenses from Macedonian Stock Exchange in the amount of EUR 0.6 thousand (2022: EUR 0.1 thousand). The Company does not have liabilities to Macedonian Stock Exchange as of December 31, 2023, nor did it have as of December 31, 2022.
Compensation paid to key management during the year amounted to EUR 262 thousand (2022: EUR 250 thousand), of which EUR 39 thousand refers to payments for obligatory pension contribution, out of which EUR 10 thousand refers to payments into the second pension pillar. The stated amount includes the allocation of the Company's own shares to the members of the Management Board in the gross amount of EUR 8.4 thousand (Note 20c). The Company did not pay remuneration to the members of the Supervisory Board.
As the only geographical market of the Zagreb Stock Exchange is Republic of Croatia, and considering that all of the Company's revenue is generated on the basis of one business activity and in the Republic of Croatia, the Management Board considers the entire Company represents one reporting segment.
Management makes estimates and assumptions related to future events. Therefore, accounting estimates rarely correspond to actual results. Estimates and judgments that may have an effect on significant changes in the amounts of assets and liabilities within the next financial year are set out below.
The Company measures investments in subsidiaries, associates and joint ventures at acquisition cost reduced by impairment of investments in separate financial statements. After initial recognition, the Company examines whether it is necessary to recognize an additional impairment of investment in associate or joint venture. At the reporting date, the Company determines whether there is objective evidence that investment in associate or joint venture is impaired. If an impairment exists, the Company calculates the amount of impairment loss as a difference between the recoverable amount and the carrying amount of the associate or joint venture and presents it in the statement of comprehensive income. If the recoverable amount of an investment is lower than its carrying amount, the Company recognizes an impairment loss. Management believes that there are no indications of impairment at the reporting date based on the analysis performed. Investments in subsidiaries, associates and joint ventures are disclosed in Notes 13 and 14. In 2023 and 2022, the Management Board estimated that the recoverable amount of the investment was not lower than the carrying amount, therefore, there was no impairment.
78 Zagreb Stock Exchange Inc., Zagreb Unconsolidated financial statements for the year ended 31 December 2023 Notes to the financial statements (continued)
The objectives of the Company in managing capital are to preserve the Company's ability to continue operating on a going concern basis to allow return on investment to shareholders and benefit other stakeholders and to maintain an optimal equity structure to minimize the cost of equity. The Company monitors capital by monitoring its own finance ratios in its financial statements. This indicator is calculated as the ratio of total equity to total assets. The self-financing indicator is as follows:
| 31 December 2023 | 31 December 2022 | |
|---|---|---|
| EUR | EUR | EUR |
| Total capital (capital and reserves) | 6,027,948 | 5,819,123 |
| Total assets | 6,929,020 | 6,830,376 |
| Indicator of own financing | 87% | 85% |
The Company finances 87% of its total assets from its own sources. Accordingly, 13% of total assets is financed from outside sources (2022: 15%).The fair values of financial assets and liabilities are included in the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The following methods and assumptions were used to estimate the fair values: The fair values of cash and cash equivalents, trade receivables, trade payables, and other current assets and liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments. Long term fixed rate and variable rate receivables are evaluated by the Company based on parameters such as interest rates and individual creditworthiness of the customer and the risk characteristics of the financed project. Based on this evaluation, allowances are taken into account for the expected losses of these receivables. Fair value of available for sale financial assets is derived from quoted market prices in active markets. A market is regarded as active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm’s length basis. The quoted market price used for financial assets held by the Company is the current bid price. These instruments are included in Level 1. The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques based on a discounted cash flow. These valuation techniques maximize the use of observable market data where it is available and rely as little as possible on entity–specific estimates. If all significant inputs required to fairly value an instrument are observable, the instrument is included in Level 2. If one or more of the significant inputs is not based on observable market data, the instrument is included in Level 3.
The Company uses following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique based on the lowest level input that is significant to the fair value determination:
As of December 31, 2023, the Company held the following financial assets measured at fair value:
| Level 1 | Level 2 | Level 3 | Total | |
|---|---|---|---|---|
| Assets EUR | ||||
| Financial assets at fair value through other comprehensive income (Note 15) | - | - | 145,916 | 145,916 |
| Financial assets at fair value through profit or loss (Note 15) | 736,505 | - | - | 736,505 |
| Total | 736,505 | - | 145,916 | 882,421 |
As of December 31, 2022, the Company held the following financial assets measured at fair value:
| Level 1 | Level 2 | Level 3 | Total | |
|---|---|---|---|---|
| Assets EUR | ||||
| Financial assets at fair value through other comprehensive income (Note 15) | - | - | 26,163 | 26,163 |
| Financial assets at fair value through profit or loss (Note 15) | 1,191,398 | - | - | 1,191,398 |
| Total | 1,191,398 | - | 26,163 | 1,217,561 |
As stated in Note 2e) Functional and presentation currency, the Company changed the functional and presentation currency from the Croatian kuna to the euro as of January 1, 2023 due to the change of the official monetary currency and official means of payment in the Republic of Croatia. As stated in the note, on January 1, 2023, the Company converted all items of assets, liabilities and capital at the conversion rate determined by the Croatian government, which was 7.5345 HRK for 1 EUR. The balances in the financial position on January 1, 2022 were converted at the exchange rate in the amount of 7.520447 HRK for 1 EUR, while the items of the profit and loss account, other comprehensive income, capital movements and cash flow were converted at the average annual exchange rate in the amount from HRK 7.520447 for EUR 1. As of December 31, 2022, the Company converted all items of the equity to euro amounts by applying the conversion rate of 7.534350 kn for 1 EUR to the kuna amounts of all items of equity presented in the statement of financial position in the financial statements for the period ended on December 31, 2022. The difference between the determined value of an individual item of equity and the value obtained in the movement of capital report at the above-mentioned exchange rates was reported in the report on capital movement in a separate item (deduction of EUR 10.8 thousand).
There were no events after the balance sheet date that would have had a significant impact on the financial statements as of or for the period then ended.
The annual consolidated financial statements of the Zagreb Stock Exchange Group are presented below, prepared in accordance with the Ordinance on the Structure and Content of Stock Exchange Annual Financial Statements (Official Gazette 25/19, 155/22) ("Regulation") prescribed by HANFA ("regulatory financial statements"). HANFA's accounting regulations are based on International Financial Reporting Standards adopted by the European Union. The main differences between regulatory financial statements prepared in accordance with HANFA's Regulation and financial statements prepared in accordance with the International Financial Reporting Standards adopted by the European Union refer to the disclosures in the financial statements.
BALANCE SHEET
balance as at 31.12.2023 in EUR
Submitter: Zagreb Stock Exchange Inc.
| Item | ADP code | Last day of the preceding business year | At the reporting date of the current period |
|---|---|---|---|
| 1 | 2 | 3 | |
| ASSETS | |||
| FIXED ASSETS | 002+003+009+013 | 4,666,224 | 4,604,038 |
| I INTANGIBLE ASSETS | 2 | 219,864 | 197,756 |
| II TANGIBLE ASSETS | 004+…+008 | 3 | 542,912 |
| 1 Land and buildings | 4 | 289,487 | 202,351 |
| 2 Computer equipment | 5 | 172,554 | 128,543 |
| 3 Other tangible assets | 6 | 57,178 | 51,058 |
| 4 Leasehold improvements | 7 | 23,693 | 16,886 |
| 5 Assets under construction | 8 | - | - |
| III FIXED FINANCIAL ASSETS | 010+011+012 | 9 | 3,887,990 |
| 1 Investments in associates, subsidiaries and joint ventures | 10 | 3,799,780 | 3,800,981 |
| 2 Financial assets at amortised cost | 11 | 62,047 | 60,547 |
| 3 Financial assets at fair value through other comprehensive income | 12 | 26,163 | 145,916 |
| DEFERRED TAX ASSETS | 13 | 15,458 | - |
| B CURRENT ASSETS | 015+021+025 | 14 | 2,137,414 |
| I RECEIVABLES | 016+...020 | 15 | 269,985 |
| 1 Customer receivables | 16 | 184,957 | 218,857 |
| 2 Receivables from employees and members of the undertaking | 17 | 35 | 212 |
| 3 Receivables from government and other institutions | 18 | 2,959 | 16,210 |
| 4 Receivables from connected undertakings | 19 | 3,635 | 3,735 |
| 5 Other receivables | 20 | 78,399 | 83,743 |
| III SHORT-TERM FINANCIAL ASSETS | 022+…+024 | 21 | 1,199,534 |
| 1 Financial assets at amortised cost | 22 | 8,136 | 1,126,162 |
| 2 Financial assets at fair value through other comprehensive income | 23 | - | - |
| 3 Financial assets at fair value through statement of profit or loss | 24 | 1,191,398 | 736,505 |
| III CASH AND CASH EQUIVALENTS | 25 | 667,895 | 114,249 |
| C PREPAID EXPENSES AND ACCRUED INCOME | 26 | 26,739 | 25,308 |
| D TOTAL ASSETS | 001+014+026 | 27 | 6,830,377 |
| E OFF-BALANCE SHEET ITEMS | 28 | - | - |
| Item | ADP code | Last day of the preceding business year | At the reporting date of the current period |
|---|---|---|---|
| 1 | 2 | 3 | |
| EQUITY AND LIABILITIES | |||
| A CAPITAL AND RESERVES | 030+031+032+037+…+041 | 29 | 5,819,123 |
| I INITIAL CAPITAL | 30 | 3,076,316 | 3,076,315 |
| II CAPITAL RESERVES | 31 | 1,839,562 | 1,840,833 |
| III PROFIT RESERVES | 033+...+036 | 32 | 886,352 |
| 1 Legal reserves | 33 | 18,714 | 18,714 |
| 2 Reserves for treasury shares | 34 | (18,409) | (30,483) |
| 3 Fair value reserves | 35 | 70,169 | 162,041 |
| 4 Other reserves | 36 | 815,878 | 815,878 |
| IV REVALUATION RESERVES | 37 | - | - |
| V RESERVES FROM EXCHANGE RATE DIFFERENCES FROM THE TRANSLATION OF FOREIGN OPERATIONS | 38 | - | - |
| VI RETAINED PROFIT OR LOSS BROUGHT FORWARD | 39 | (7) | 8,447 |
| VII PROFIT OR LOSS FOR THE YEAR | 40 | 16,900 | 136,203 |
| VIII MINORITY INTEREST | 41 | - | - |
| B PROVISIONS | 42 | - | - |
| C SHORT-TERM LIABILITIES | 044+...049 | 43 | 293,447 |
| 1 Liabilities for advance payments | 44 | 499 | 7,795 |
| 2 Liabilities to suppliers | 45 | 74,100 | 72,174 |
| 3 Liabilities to employees | 46 | 43,959 | 43,758 |
| 4 Taxes, contributions and similar liabilities | 47 | 43,442 | 39,659 |
| 5 Liabilities to connected undertakings | 48 | 263 | 591 |
| 6 Other short-term liabilities | 49 | 131,184 | 130,852 |
| D LONG-TERM LIABILITIES | 50 | 230,548 | 134,348 |
| E DEFERRED TAX LIABILITY | 51 | - | 6,540 |
| F ACCRUALS AND DEFERRED INCOME | 52 | 487,259 | 465,355 |
| G TOTAL LIABILITIES | 029+042+043+050+051+052 | 53 | 6,830,377 |
| H OFF-BALANCE SHEET ITEMS | 54 | - | - |
Appendix to the balance sheet (position for consolidated# Zagreb Stock Exchange Inc., Zagreb
Forms in accordance with the Ordinance on the Structure and Content of Stock Exchange Annual Financial Statements (Official Gazette 25/19, 155/22) for the year ended 31 December 2023 (separate)
For the period from 1.1.2023 to 31.12.2023 in EUR
Submitter: Zagreb Stock Exchange Inc.
| Item | ADP | Same period of the previous year | Current period |
|---|---|---|---|
| A OPERATING INCOME | 002+008 | ||
| I Sales revenue | 003+...+007 | 1,363,284 | 1,299,319 |
| 1 Commissions and membership fees | 520,924 | 499,422 | |
| 2 Listing maintenance fees | 685,216 | 677,682 | |
| 3 Quotation fees | 157,144 | 122,215 | |
| 4 Income from auctions | - | - | |
| 5 Income from memberships | - | - | |
| II Other operating income | 009+...+011 | 672,578 | 718,425 |
| 1 Income from application programming interface (API) services | - | - | |
| 2 Income from the supply of information | 327,834 | 355,160 | |
| 3 Other income | 344,744 | 363,265 | |
| B OPERATING EXPENSES | 013+016+020+021+022+025+026 | 1,980,574 | 2,051,463 |
| I Material costs | 014+015 | 555,668 | 592,332 |
| 1 Costs of raw materials | 60,066 | 65,956 | |
| 2 Other external costs | 495,602 | 526,376 | |
| II Staff costs | 017+...+019 | 965,495 | 951,287 |
| 1 Net salaries and wages | 553,974 | 543,802 | |
| 2 Tax and contributions from salary costs | 278,582 | 275,607 | |
| 3 Payroll contributions | 132,939 | 131,878 | |
| III Depreciation | 020 | 180,410 | 207,741 |
| IV Other costs | 021 | 273,667 | 286,797 |
| V Value adjustment | 023+024 | - | - |
| 1 fixed assets (other than financial assets) | - | - | |
| 2 current assets (other than financial assets) | - | - | |
| VI Provisions | 025 | - | - |
| VII Other operating expenses | 026 | 5,334 | 13,306 |
| C FINANCIAL INCOME | 028+...+033 | 65,345 | 182,233 |
| 1 Interest, exchange rate differences, dividends and similar income from relations with connected undertakings | 028 | 55,861 | 106,091 |
| 2 Interest, exchange rate differences, dividends and similar income from relations with non-connected undertakings and other persons | 029 | 9,116 | 49,465 |
| 3 Income share from associates and participating interests | 030 | - | - |
| 4 Unrealised gains (income) from financial assets | 031 | - | 12,089 |
| 5 Profit from reversal of provisions for impairment for expected credit losses | 032 | - | - |
| 6 Other financial income | 033 | 368 | 14,588 |
Forms in accordance with the Ordinance on the Structure and Content of Stock Exchange Annual Financial Statements (Official Gazette 25/19, 155/22) for the year ended 31 December 2023 (separate)
| Item | ADP | Same period of the previous year | Current period |
|---|---|---|---|
| D FINANCIAL EXPENSES | 035+...+039 | 119,197 | 10,481 |
| 1 Interest, exchange rate differences and other expenditures with connected undertakings | 035 | 89 | - |
| 2 Interest, exchange rate differences and other expenditure from relations with non-connected undertakings and other persons | 036 | 23,705 | 10,481 |
| 3 Unrealised losses (expenses) from financial assets | 037 | 95,403 | - |
| 4 Loss allowance for expected credit losses | 038 | - | - |
| 5 Other financial expenses | 039 | - | - |
| E TOTAL INCOME | 001+027 | 2,101,207 | 2,199,977 |
| F TOTAL EXPENDITURE | 012+034 | 2,099,771 | 2,061,944 |
| G Share in profit/loss of associates and subsidiaries | 042 | - | - |
| H PRE-TAX PROFIT OR LOSS | 040-041+042 | 1,436 | 138,033 |
| I INCOME TAX | 044 | (15,464) | 1,830 |
| J PROFIT OR LOSS FOR THE PERIOD | 043-044 | 16,900 | 136,203 |
| 1 Change in revaluation reserves (property, plant, equipment and intangible assets) | 046 | - | - |
| 2 Actuarial gains/losses on defined benefit pension plans | 047 | - | - |
| 3 Unrealised gains/losses on financial assets at fair value through other comprehensive income | 048 | 70,196 | 112,040 |
| 4 Gains/losses on hedging instruments in a cash flow hedge | 049 | - | - |
| 5 Gains/losses arising from translation of financial statements relating to foreign operations | 050 | (34) | - |
| 6 Income tax on other comprehensive income | 051 | - | 20,168 |
| K OTHER COMPREHENSIVE INCOME | 046+…+051 | 70,162 | 91,872 |
| TOTAL COMPREHENSIVE INCOME | 045+052 | 87,062 | 228,075 |
| M RECLASSIFICATION ADJUSTMENTS | 054 | - | - |
| Appendix | |||
| Attributable to owners of the parent | 055 | - | - |
| Attributable to non-controlling interest | 056 | - | - |
Forms in accordance with the Ordinance on the Structure and Content of Stock Exchange Annual Financial Statements (Official Gazette 25/19, 155/22) for the year ended 31 December 2023 (separate)
Submitter: Zagreb Stock Exchange
| Item | ADP code | Same period of the previous year | Current period |
|---|---|---|---|
| CASH FLOW FROM OPERATING ACTIVITIES | |||
| 1 Pre-tax profit | 1 | 1,436 | 138,033 |
| 2 Depreciation | 2 | 180,410 | 207,741 |
| 3 Increase in short-term liabilities | 3 | - | - |
| 4 Decrease in short-term receivables | 4 | 25,067 | - |
| 5 Decrease in inventories | 5 | - | - |
| 6 Loss on impairment for expected credit losses | 6 | - | - |
| 7 Other cash flow increase | 7 | 120,636 | - |
| I Total cash flow increase from operating activities | 001+...+007 | 327,549 | 345,774 |
| 1 Decrease in short-term liabilities | 9 | 9,613 | 1,761 |
| 2 Increase in short-term receivables | 10 | - | 52,772 |
| 3 Increase in inventories | 11 | - | - |
| 4 Profit from reversal of provisions for impairment for expected credit losses | 12 | - | - |
| 5 Other cash flow decrease | 13 | 71,670 | 201,911 |
| II Total cash flow decrease from operating activities | 009+...+013 | 81,283 | 256,444 |
| CASH FLOW FROM INVESTMENT ACTIVITIES | |||
| 1 Cash receipts from sale of fixed tangible and intangible assets | 15 | - | - |
| 2 Cash receipts the from sale of equity instruments and debt instruments | 16 | - | - |
| 3 Interest received | 17 | 887 | - |
| 4 Dividends received | 18 | 55,819 | 138,622 |
| 5 Other cash receipts from investment activities | 19 | 1,333,676 | 482,926 |
| III Total cash receipts from investment activities | 015+...+019 | 1,390,382 | 621,548 |
| 1 Cash payments for the purchase of fixed tangible and intangible assets | 21 | 231,883 | 41,559 |
| 2 Cash payments for the acquisition of equity financial instruments and debt financial instruments | 22 | 1,076,845 | 28,164 |
| 3 Other cash payments from investment activities | 23 | 8,397 | 1,101,744 |
| IV Total cash payments from investment activities | 021+...+023 | 1,317,125 | 1,171,467 |
Forms in accordance with the Ordinance on the Structure and Content of Stock Exchange Annual Financial Statements (Official Gazette 25/19, 155/22) for the year ended 31 December 2023 (separate)
| Item | ADP code | Same period of the previous year | Current period |
|---|---|---|---|
| CASH FLOW FROM FINANCING ACTIVITIES | |||
| 1 Cash receipts from the issue of equity financial instruments and debt financial instruments | 25 | - | - |
| 2 Cash receipts from credit principals, debentures, loans and other borrowings | 26 | - | - |
| 3 Other cash receipts from financing activities | 27 | - | - |
| V Total cash receipts from financing activities | 025+...+027 | - | - |
| 1 Cash payments for credit principals and bonds | 29 | - | - |
| 2 Cash payments for dividends | 30 | - | - |
| 3 Cash payments for finance lease | 31 | - | - |
| 4 Cash payments for the redemption of treasury shares | 32 | - | - |
| 5 Other cash payments from financing activities | 33 | 97,982 | 93,057 |
| VI Total cash payments from financing activities | 029+...+033 | 97,982 | 93,057 |
| VII Cash and cash equivalents at the beginning of period | 35 | 446,354 | 667,895 |
| VIII Increase of cash and cash equivalents | 36 | 221,541 | - |
| IX Decrease of cash and cash equivalents | 37 | - | 553,646 |
| X Cash and cash equivalents at the end of period | 38 | 667,895 | 114,249 |
Forms in accordance with the Ordinance on the Structure and Content of Stock Exchange Annual Financial Statements (Official Gazette 25/19, 155/22) for the year ended 31 December 2023
| Item | ADP | Attributable to owners of the parent | Attributable to non-controlling interests | Total capital and reserves | Subscribed capital | Capital reserves | Legal reserves and reserves for treasury shares | Fair value reserves | Other reserves | Revaluation reserves | Reserves from exchange rate differences from the translation of foreign operations | Retained profit or loss brought forward | Profit or loss for the year |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Balance on the first day of the previous business year | 1 | 6,164,128 | 1,843,000 | 18,749 | - | - | - | - | - | - | (2,380,697) | 116,118 | - |
| Change in accounting policies | 2 | - | - | - | - | - | - | - | - | - | - | - | - |
| Correction of errors from prior periods | 3 | - | - | - | - | - | - | - | - | - | - | - | - |
| Balance on the first day of the previous business year (restated) | 4 | 6,164,128 | 1,843,000 | 18,749 | - | - | - | - | - | - | (2,380,697) | 116,118 | - |
| Profit or loss for the period | 5 | - | - | - | - | - | - | - | - | - | - | 16,900 | - |
| Unrealised gains or losses on financial assets at fair value through other comprehensive income | 6 | - | - | - | - | - | 70,196 | - | - | - | - | - | - |
| Other changes in equity unrelated to owners | 7 | - | - | - | - | - | - | - | - | - | - | - | - |
| Total directly recognized income and expenses of the previous year (previous year periods) | 8 | - | - | - | - | - | 70,196 | - | - | - | - | 16,900 | - |
| Increase/decrease in subscribed capital | 9 | (3,077,506) | - | 815,960 | - | - | - | - | - | 2,261,546 | - | - | |
| Other contributions by owners | 10 | - | - | - | - | - | - | - | - | - | - | - | - |
| Payment of share in profit/dividend | 11 | - | - | - | - | - | - | - | - | - | - | - | - |
| Other distribution to owners | 12 | - | - | (18,416) | - | (82) | - | 116,118 | - | - | - | (116,118) | - |
| Balance on the last day of the previous business year reporting period | 13 | 3,086,622 | 1,843,000 | 333 | 70,196 | 815,878 | - | (3,033) | 16,900 | - | 5,829,896 |
Forms in accordance with the Ordinance on the Structure and Content of Stock Exchange Annual Financial Statements (Official Gazette 25/19, 155/22) for the year ended 31 December 2023
| Item | ADP |
| :--- | :-- |# Zagreb Stock Exchange Inc., Zagreb Notes to the forms in accordance with the Ordinance on the Structure and Content of Stock Exchange Annual Financial Statements (Official Gazette 25/19, 155/22) for the year ended 31 December 2023 (separate)
Zagreb Stock Exchange Inc, (“the Company”) is a joint stock company domiciled in Republic of Croatia and was registered at the Commercial Court in Zagreb on 5 July 1991 under the number (MBS) 0800034217, The personal identification number of the Company (OIB) is 84368186611. The address of the Company’s registered office is Eurotower, 22nd floor, Ivana Lučića 2a/22, Zagreb, Croatia.
Basis of preparation and significant accounting policies
Basis for preparation
Separate financial statements are prepared in accordance with the International Financial Reporting Standards as adopted by the European Union (IFRS. Separate financial statements are prepared on a historical cost basis, except for financial assets at fair value through profit or loss and financial assets at fair value through other comprehensive income which are measured at fair value. Detailed information on the basis of preparation of the financial statements are provided in Note 2 to the separate financial statements presented in the Annual Report on Company Status and Business Activities in 2023 available on the internet page www.zse.hr (further: the Company’s Annual Report).
Significant accounting policies
Financial statements for the reporting period are prepared applying the same accounting policies as in the latest separate financial statements for 2023 available on the internet page www.zse.hr.
Disclosure of additional information required by IFRSs that are not presented elsewhere in the separate statement of financial position, statement of comprehensive income, statement of cash flows and statement of changes in equity
Additional information required by IFRSs that are not presented elsewhere in the separate statement of financial position, statement of comprehensive income, statement of cash flows and statement of changes in equity are disclosed in the Company’s Annual Report as published on the internet page www.zse.hr.
Financial commitments, guarantees or contingencies that are not included in the balance sheet, and an indication of the nature and form of any valuable security which has been provided
The Company does not have financial commitments, guarantees or contingencies that are not included in the balance sheet as of December 31, 2023, nor has issued securities.
Amount of advance payments and loans granted to the members of administrative, management and supervisory bodies
The Company did not give advances or approved loans to members of administrative, management and supervisory bodies during 2023 or 2022.
Amount and nature of individual items of income or expenditure which are of exceptional size or incidence
Details on the income or expenditure which are of exceptional size or incidence are presented in the Notes to the audited financial statements in the Company’s Annual Report (www.zse.hr).
At the balance sheet date, the Company does not have liabilities falling due after more than five years. At the balance sheet date, the Company does not have debts covered by valuable securities provided by the Company.
Average number of employees during the reporting period
The average number of the employees during the reporting period of 2023 is 24.
Capitalized costs of salaries during the reporting period
The Company did not capitalize the cost of salaries during the reporting period.
Amount of salaries and remunerations approved for the business year to members of administrative, management and supervisory bodies
The amount of salaries and remunerations approved for the year 2023 to the members of the administrative, management and supervisory bodies due to their responsibilities and all obligations arising from or agreed upon in connection with the retirement of the former members of these bodies are published in Note 25 Related parties in the Company’s Annual Report (www.zse.hr).
The Company does not divide employees into categories. During 2023, the Company had an average of 24 employees. The income of employees for 2023 broken down into net salaries and wages, the costs of taxes and contributions from salaries, contributions to salaries and other salary expenses that do not include reimbursements of expenses are published in Note 6 Personnel expenses in the Company’s Annual Report (www.zse.hr).
Provisions for deferred taxes, balance of deferred taxes at the beginning and the end of the reporting period, as well as movement of those positions during the reporting period are presented in the Note 9 in the Company’s Annual Report (www.zse.hr).
Information on investments in companies in which the Company holds a participating share in the capital are presented in Notes "Investments in subsidiaries" and "Investments in associates and joint ventures" (GFI: "Investments in associates, subsidiaries and joint ventures").
Based on the Decision of the Company's Assembly dated June 14, 2022, the share capital of the Company is reduced in a regular procedure for the purpose of transferring EUR 3.076.316 (HRK 23,178,500,00) to other reserves of the Company. By undertaking the share capital reduction, the nominal value per share is reduced to the amount which is lower than the minimum nominal amount permitted under Article 163(2) of the Companies Act. Hence, the share capital is reduced in a regular procedure through a consolidation of shares (reverse split), in accordance with Article 342(4) of the Companies Act. The shares are consolidated at a ratio of 2:1 by issuing to each shareholder 1 registered share with a nominal value of EUR 1.33 (HRK 10,00) for 2 shares outstanding.
Based on the decision of the Company’s General Assembly dated June 12, 2023, for the purposes of aligning the Company's share capital and parts of that capital that relate to individual shares with the provisions of Article 21 of the Act on Amendments to the Companies Act ("Official Gazette" No. 114/22) , all shares of the Company were replaced by ZB-R-A shares with a nominal amount for shares without a nominal amount.
| Attributable to owners of the parent | Attributable to non-controlling interests | Total capital and reserves | Subscribed capital | Capital reserves | Legal reserves and reserves for treasury shares | Fair value reserves | Other reserves | Revaluation reserves | Reserves from exchange rate differences from the translation of foreign operations | Retained profit or loss brought forward | Profit or loss for the year | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Balance on the first day of the current business year | 3,086,622 | 1,843,000 | 333 | 70,196 | 815,878 | - | - | (3,033) | 16,900 | - | 5,829,896 | - |
| Change in accounting policies | (10,306) | (3,438) | (28) | (27) | - | - | - | 3,026 | - | - | (10,773) | - |
| Correction of errors from prior periods | - | - | - | - | - | - | - | - | - | - | - | - |
| Balance on the first day of the current business year (restated) | 3,076,316 | 1,839,562 | 305 | 70,169 | 815,878 | - | - | (7) | 16,900 | - | 5,819,123 | - |
| Profit or loss for the period | - | - | - | - | - | - | - | 136,203 | - | - | - | 136,203 |
| Unrealised gains or losses on financial assets at fair value through other comprehensive income | - | - | - | - | - | - | 91,872 | - | - | - | - | - |
| Other changes in equity unrelated to owners | - | - | - | - | - | - | 16,900 | (16,900) | - | - | - | - |
| Total directly recognised income and expenses of the current year (current period) | - | - | - | - | - | - | 16,900 | 119,303 | - | - | - | 228,075 |
| Increase/decrease in subscribed capital | (1) | 1 | - | - | - | - | - | - | - | - | - | - |
| Other contributions by owners | - | - | - | - | - | - | - | - | - | - | - | - |
| Payment of share in profit/dividend | - | 1,270 | 5,182 | - | - | - | (8,446) | - | - | - | - | (1,994) |
| Other distribution to owners | - | - | (17,256) | - | - | - | - | - | - | - | - | (17,256) |
| Balance on the last day of the current business year reporting period | 3,076,315 | 1,840,833 | (11,769) | 162,041 | 815,878 | - | 8,447 | 136,203 | - | - | 6,027,948 | - |
The Company has no shares in companies having unlimited liability.
The Company is the final parent company and is not a controlled member of any group. The Company prepares consolidated financial statements that are available for use on the internet page www.zse.hr.
The Company is the final parent company and is not a controlled member of any group.
The Company prepares consolidated financial statements that are available for use on the internet page www.zse.hr.
The proposal on the distribution of profits for 2023 is attached to the Company's Annual Report, which is published on the website www.zse.hr.
The Company has no arrangements that are not included in the presented unconsolidated financial statements.
Significant events arising after the balance sheet date are presented in Notes to the Company’s Annual Report as published on the internet page www.zse.hr.
The Company generates all its revenues in Croatia, and for reporting purposes, the entire business represents one business segment.
The amount of the auditor's fee for the statutory audit of annual financial statements and the amount of other fees to the auditor is published in the notes to the unconsolidated financial statements in the Company’s Annual Report.
| Balance sheet item (IFRS) | Amount (EUR) | Balance sheet item (GFI) | AOP Amount (EUR) |
|---|---|---|---|
| ASSETS | |||
| Non-current assets | 4,604,038 | A. FIXED ASSETS | 4,604,038 |
| I Intangible assets | 197,756 | 197,756 | |
| Intangible assets | 197,756 | 197,756 | |
| II Tangible assets | 398,838 | 398,838 | |
| Land and buildings | 166,323 | 202,351 | |
| Right-of-use assets | 232,515 | ||
| Computer equipment | 128,543 | ||
| Other tangible assets | 51,058 | ||
| Leasehold improvements | 16,886 | ||
| III Long term financial assets | 4,007,444 | 4,007,444 | |
| Investment in subsidiary | 2,538,382 | Investments in associates, subsidiaries and joint ventures | 3,800,981 |
| Investment in associate and joint venture | 1,262,599 | ||
| Financial assets at fair value through other comprehensive income | 60,547 | Financial assets at amortised cost (long term) | 60,547 |
| Long term deposits | 33,166 | ||
| Loans receivable from associate | 27,381 | ||
| Financial assets at fair value through other comprehensive income | 145,916 | 145,916 | |
| Deferred tax assets | - | Deffered tax assets | - |
| CURRENT ASSETS | 2,311,353 | B CURRENT ASSETS | 2,299,673 |
| I RECEIVABLES | 334,437 | 322,757 | |
| Trade receivables and other assets | 334,437 | 322,757 | |
| Trade receivables | 218,857 | ||
| Receivables from employees and members of the undertaking | 212 | ||
| Receivables from government and other institutions | 16,210 | ||
| Receivables from connected undertakings | 3,735 | ||
| Other receivables | 83,743 | ||
| II SHORT-TERM FINANCIAL ASSETS | 1,862,667 | 1,862,667 | |
| Short-term deposits | 1,126,162 | Financial assets at amortised cost | 1,126,162 |
| Financial assets at fair value through profit or loss | 736,505 | Financial assets at fair value through statement of profit or loss | 736,505 |
| Cash and cash equivalents | 114,249 | III CASH AND CASH EQUIVALENTS | 114,249 |
| Prepaid expenses | 13,629 | C PREPAID EXPENSES AND ACCRUED INCOME | 25,309 |
| Prepaid expenses | 13,629 | C PREPAID EXPENSES AND ACCRUED INCOME | 25,309 |
| TOTAL ASSETS | 6,929,020 | D TOTAL ASSETS | 6,929,020 |
| CAPITAL AND LIABILITIES | |||
| CAPITAL AND RESERVES | 6,027,948 | A CAPITAL AND RESERVES | 6,027,948 |
| Issued share capital | 3,076,315 | I INITIAL CAPITAL | 3,076,315 |
| Share premium | 1,840,833 | II CAPITAL RESERVES | 1,840,833 |
| Profit reserves | 966,150 | III PROFIT RESERVES | 966,150 |
| Legal reserves | 18,714 | Legal reserves | 18,714 |
| Own shares | (30,483) | Reserves for treasury shares | (30,483) |
| Fair value reserves | 162,041 | Fair value reserves | 162,041 |
| Other reserves | 815,878 | Other reserves | 815,878 |
| IV REVALUATION RESERVES | |||
| V RESERVES FROM EXCHANGE RATE DIFFERENCES FROM THE TRANSLATION OF FOREIGN OPERATIONS | |||
| Accumulated losses | 144,650 | IV Retained profit of loss brought forward | 8,447 |
| Profit or loss for the year | V Profit or loss for the year | 136,203 | |
| Long term liabilities | 140,888 | Long term liabilities and provisions | 140,888 |
| Long term lease liabilities | 134,348 | B Provisions | 134,348 |
| D Long term liabilities | 134,348 | ||
| Deferred tax liabilities | 6,540 | E Deferred tax liabilities | 6,540 |
| 154,516 | 154,515 |
| Balance sheet item (IFRS) | Amount (EUR) | Balance sheet item (GFI) | AOP Amount (EUR) |
|---|---|---|---|
| Short term liabilities | 294,830 | C SHORT TERM LIABILITIES | 294,829 |
| Trade and other payables | 198,630 | ||
| Advance payments received | 1 Advance payments received | 7,795 | |
| Short term lease liabilities | 96,200 | 2 Trade payables | 72,174 |
| 3 Liabilities to employees | 43,758 | ||
| 4 Taxes, contributions and similar liabilities | 39,659 | ||
| 5 Liabilities to connected undertakings | 591 | ||
| 6 Other short-term liabilities | 130,852 | ||
| 294,830 | 294,829 | ||
| 465,354 | F Accruals and deferred income | 465,355 | |
| Contract liabilities | 465,354 | Accrued expenses | 465,354 |
| 465,355 | 465,355 | ||
| Total equity and liabilities | 6,929,020 | Total equity and liabilities | 6,929,020 |
| P&L item (IFRS) | Amount (EUR) | P&L item (GFI) | AOP Amount (EUR) |
|---|---|---|---|
| Operating revenues | 2,017,744 | A OPERATING INCOME | 2,017,744 |
| Sales revenue | 1,299,319 | I Sales revenue | 1,299,319 |
| Other operating income | 718,425 | II Other operating income | 718,425 |
| 2,017,744 | 2,017,744 | ||
| Operating expenses | 2,051,463 | B OPERATING EXPENSES | 2,051,463 |
| Staff costs | 1,002,235 | II Staff costs | 951,287 |
| Other employee costs (GFI AOP 22) | (50,948) | ||
| 951,287 | 951,287 | ||
| Other operating expenses | 841,487 | I Material costs | 592,332 |
| Expenses reported under Staff costs | 50,948 | ||
| IV Other costs | 286,797 | ||
| V Value adjustment 024+025 | 22 | ||
| VII Other operating expenses | 13,306 | ||
| 892,435 | 892,435 | ||
| Depreciation and amortization | 207,741 | III Depreciation | 207,741 |
| Net financial income | 171,752 | Net financial income | 171,752 |
| Financial income | 155,601 | C FINANCIAL INCOME | 182,233 |
| Dividend income | (10,260) | D FINANCIAL EXPENSES | (10,481) |
| Financial expenses | 26,533 | ||
| Net foreign exchange gain/(loss) | (122) | ||
| Profit before tax | 138,033 | H PRE-TAX PROFIT OR LOSS | 138,033 |
| Income tax expense | 1,830 | I INCOME TAX | 1,830 |
| Profit for the year | 136,203 | J PROFIT OR LOSS FOR THE PERIOD | 136,203 |
| Other comprehensive income | |||
| Other comprehensive income | |||
| Changes in the fair value of equity investments at fair value | 112,040 | Unrealised gains/losses on financial assets at fair value through other comprehensive income | 112,040 |
| Income tax on other comprehensive income on items that cannot be reclassified to |
profit or loss (20,168) Income tax on other comprehensive income 51 20,168 Total other comprehensive profit 91,872 K OTHER COMPREHENSIVE INCOME 52 91,872 Total comprehensive profit for the year 228,075 TOTAL COMPREHENSIVE INCOME 53 228,075 98 99 100 101
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