PETROL d.d., Ljubljana
Additional Clarification on the Reasons for Termination of Office of Members of the Management Board of Petrol d.d., Ljubljana
The information contained in this announcement will remain posted on the website of Petrol d.d., Ljubljana (www.petrol.si) at least 5 years from the date it is published.
With regard to the calls addressed to the Management Board and the Supervisory Board of Petrol d.d., Ljubljana, by Slovenian Sovereign Holding, d.d. and Kapitalska družba pokojninskega in invalidskega zavarovanja, d.d., we hereby provide the following explanations:
1. Explanations concerning the appointment of the new Management Board
Petrol's Supervisory Board is an independent Company body. In accordance with the Articles of Association, it consists of 9 members, of which 6 are shareholder representatives appointed by the General Meeting and 3 employee representatives appointed to the Supervisory Board by the Company's Workers' Council.
In accordance with applicable legislation (Article 38 bis of the Companies Act), each member of the Supervisory Board shall avoid any conflict of their own interests or duties with the interests or duties of the company they are supervising.
Throughout its term of office, the Supervisory Board closely monitored the Company's operations in order to ensure successful performance.
During its term of office, the Supervisory Board of Petrol d.d., Ljubljana made sure at all times that its duties were carried out conscientiously and in compliance with applicable regulations. Neither Slovenian Sovereign Holding nor any of the other shareholders were put in a privileged position, as all communication with shareholders took place through the channels that are intended for this purpose, i.e. the web portal of the Ljubljana Stock Exchange (SEO.net) and the website of Petrol d.d., Ljubljana. Shareholders have thus always had the same amount and quality of information. As a result, no damage could have been caused to any of the shareholders, despite recent claims in the media to the contrary.
As regards the early termination of the term of office of Management Board members, the then president or any other member of the Supervisory Board did not provide any of the shareholders with any information that had not been previously made public and thus accessible to all shareholders of the Company. Owing to this method of communication, none of the shareholders was not and could not have been aware in advance of any procedures for the early termination of the term of office of the former Management Board of Petrol d.d., Ljubljana.
The Supervisory Board of Petrol d.d., Ljubljana is an independent Company body, in conformity with applicable legislation. Moreover, all members of this body act with full autonomy and for the benefit of the company they are supervising. The Supervisory Board's decision relating to the early termination of the term of office of Petrol's Management Board through mutual agreement was taken unanimously, with all Supervisory Board members present at the meeting. The decision was made by taking into account the information available to the Supervisory Board at that time and following a discussion during which all circumstances were thoroughly examined. Upon completion of the discussion, the unanimous decision was presented to the Management Board with which an agreement was subsequently reached on the termination of contracts through mutual agreement.
Immediately after the decision has been adopted, the Supervisory Board appointed a temporary management board consisting of Nada Drobne Popović and Danijela Ribarič Selaković, while Ika Krevzel Panić, Member of the Management Board, continues her term of office. The members have already divided the tasks and activities between themselves.
The Supervisory Board has already convened a meeting of its personnel committee with the purpose of appointing a management board with its full term of office in the shortest time possible.
2. Explanations concerning the agreement reached with Tomaž Berločnik, the former president of the Management Board, and Rok Vodnik and Igor Stebernak, the former members of the Management Board
On 28 October 2019, Slovenian Sovereign Holding d.d. addressed a letter to the Supervisory Board of Petrol d.d. Ljubljana, requesting them:
- to provide clarification on the grounds and reasons that led to the early termination of offices of the president and two members of the Management Board of Petrol d.d.,
- to assess the consequences of early termination of their offices, and
- to disclose key elements of the agreement, or at least to disclose whether the agreement includes key reasons, grounds and consequences of the replacement of three members of the board.
With regard to the above-mentioned, the Supervisory Board explains that the reason for an early termination of offices of the president and two members of the Management Board is a disagreement with regard to the implementation of the Company's strategy, as previously explained in the statements made immediately after signing the agreements. Unfortunately, the Supervisory Board cannot provide detailed explanations on the grounds that led them to the decision to conclude the agreements for early termination of offices, since the agreements also determine the content of statements for public which, at least at this stage, also includes shareholders. As already explained, the decision for the early termination of offices was necessary and aimed at protecting the interests of the company, and in accordance with the provisions of the Companies Act (ZGD-1).
Furthermore, the said agreements constitute a business secret, except for the part in which the content of statements for public has been agreed upon. The Supervisory Board sought to obtain consent from the former president and members of the Management Board for more detailed explanations that had been presented to the former Management Board before the agreement was concluded and led the Supervisory Board to reach a unanimous decision for the early termination of offices. The Supervisory Board obtained consent to disclose the agreements, but the former members of the management board failed to give consent to a simultaneous disclosure of the circumstances in which the agreements were signed. The Supervisory Board estimates that the mere disclosure of the texts of the agreements without a simultaneous explanation of what was going on at the Supervisory Board’s meeting and without an explanation of the circumstances that led to the signing of these agreements, the interested public would be unable to get a clear picture of the reasons for the Supervisory Board’s decision.
Despite the legitimate interest of the shareholders in obtaining additional information, the Supervisory Board believes it is important to adhere to a legally binding agreement. The possible disclosure of additional grounds would constitute a breach of the assumed obligations. Although, at the given moment it might be “prudent” for the Supervisory Board to provide more comprehensive explanations, we consider it important not to breach the Supervisory Board’s commitments.
With regard to the above-mentioned, the Supervisory Board adds that when adopting the decision on the consensual early termination of offices, it followed its core mission and duty to adopt decisions that are in the best interest of the company. The members of the Supervisory Board acted with the diligence of a conscientious and honest businessperson, as stipulated in the Companies Act, which in the same article that stipulates the said duty, also stipulates that the members of the management and supervisory bodies are obliged to safeguard the trade secrets of the company. Given that the agreement constitutes a business secret, the Supervisory Board believes that the said agreement must be respected until the consent has been obtained from both the former president as well as former members of the board, for disclosure of the additional circumstances in which the agreements were signed, and/or until the legal and statutory conditions are fulfilled to enable the above-mentioned reasons are discussed at the general meeting of the company. In this respect, we would like to add that we believe that the fact that both the former president and members of the management board agreed with an early termination of offices, is in itself relevant to the assessment of the decision made.
To conclude, the Supervisory Board will continue endeavouring to obtain consent for disclosure of additional grounds leading to the consensual early termination of offices. At this time, the Supervisory Board cannot assess whether or not it will receive such consent. Notwithstanding the above, it believes that the shareholders may obtain additional information on the Supervisory Board's decision and the grounds that led to the consensual early termination of offices through the exercise of their rights at the general meeting of shareholders.
Finally, we would like to emphasise that the Supervisory Board of Petrol d.d. Ljubljana has acted with due care for the benefit of Petrol d.d., Ljubljana and its shareholders throughout its term of office.
3. Explanations concerning the Company's operations and performance of the Management Board
Petrol d.d., Ljubljana continues to carry out its principal activities in order to achieve its strategic goals.
The 2018 – 2022 strategy lays the foundations for the Group's business operations. By the year 2022, EBITDA is expected to amount to EUR 233 million and net profit to EUR 116 million, with an emphasis on a stable net debt/EBITDA ratio.
Investments in fixed assets are expected to amount to EUR 521 million in the period 2018 – 2022, this being an important prerequisite for effective long-term growth, development and performance of the Petrol Group. Ensuring business growth and increasing the profitability of operations while maintaining the commitment to sustainable development are the main principles underpinning the preparation and implementation of the strategic plan.
By offering a comprehensive range of solutions, the Petrol Group will be a sustainable provider of first-rate energy for homes, journeys and businesses. Our actions will serve to demonstrate our social responsibility and commitment to sustainable development on a daily basis. The implementation of our mission, which is summed up in our corporate signature Energy for Life, reflects not only our values and core capabilities but also our competitive advantages. Our value proposition, or benefits for customers, consists of straightforward, comprehensive, modern, convenient, accessible, quick, reliable, personalised and fair solutions provided through an active, uniform and multi-channel approach to our customers, which are treated in an all-round and life-long manner.
As a major regional provider of comprehensive and sustainable solutions, we are committed under Petrol's 2022 vision to bringing together energy, trade, mobility and advanced services into an excellent user experience. Through innovation, digital solutions, cost-effectiveness and partnerships, we will develop successful business models.
Our business model is built on innovativeness and cost effectiveness, and our customers are offered straightforward, comprehensive, modern and reliable solutions. Risk management is integrated into all aspects of our business, making it possible to create additional value for shareholders and maintain our investment-grade credit rating.
The Petrol Group operates primarily in South Eastern, but also in Central Europe. In addition to a number of bigger and smaller companies with innovative business models already operating there, new and even global players are now joining trade and energy activities in these markets. Globally and locally, we are faced with significant societal and technological changes which can be captured concisely by the notion of "digital globalisation". All of this increases risks while also providing new opportunities.
Our key strategic orientations – or strategic themes – for the period up to 2022 are as follows:
1. Balance between stable operations and development in order to address new challenges.
2. More value for the customer thanks to a comprehensive range of products and services and excellent user experience.
3. Process efficiency and risk management.
Achieving these goals strengthens the long-term financial stability of the Petrol Group. Through a stable dividend policy, we will ensure a balanced dividend yield for shareholders and the use of free cash flows to finance the Petrol Group’s investment plans. This will allow for long-term growth and development of the Petrol Group, maximising its value for the owners.
On 10 October 2019, Standard & Poor's Ratings Services reaffirmed Petrol d.d., Ljubljana's "BBB-" long-term credit rating, its "A-3" short-term credit rating and its "stable" credit rating outlook. Petrol d.d., Ljubljana thus belongs to a prestigious group of companies with an investment-grade rating. Maintaining the investment-grade rating is therefore a key objective of our strategy.
Immediately following its appointment at the Supervisory Board meeting of 24 October 2019, the Company's Management Board set out to continue with all key business activities already underway, with an emphasis on preparing the company’s business plan for 2020 and continuation of all necessary projects to close the financial year 2019 successfully. The Petrol Group's operations are running smoothly and in line with the approved strategy and annual plan.
The Management Board of Petrol d.d., Ljubljana
The Supervisory Board of Petrol d.d., Ljubljana