Babiš's Agrofert received 1.7 billion crowns in subsidies last year — three-quarters of its profit

Agrofert, the holding company formerly owned by Czech Prime Minister Andrej Babiš, received a total of CZK 1.7 billion in state subsidies in 2025. That figure represents almost three-quarters of its net profit of CZK 2.3 billion, according to the company's consolidated annual report.

Agricultural subsidies made up the bulk of the support, as they traditionally have. A year earlier the ratio of profit to subsidies received was less pronounced, but that was because profit had been artificially inflated by the sale of the Mafra media group and the chemical company Synthesie.

Subsidies under prosecutors' scrutiny

State support for Agrofert remains under close watch because the holding used to belong to sitting Prime Minister Andrej Babiš (ANO movement). In February he transferred his Agrofert shares into the RSVP Trust trust fund, declaring that this resolved his conflict of interest. However, following a complaint filed by the Pirate Party, the European Public Prosecutor's Office is now examining the subsidies paid to Agrofert and a possible conflict of interest involving the prime minister.

The volume of Agrofert's agricultural operating subsidies has been shrinking since 2023, when the so-called redistributive payment came into effect, favouring small and medium-sized farmers over large agricultural holdings. In 2025 Agrofert received CZK 1.3 billion in operating subsidies, down from CZK 1.6 billion the previous year.

"Subsidies are received by individual companies within the group in line with the conditions of specific programmes. We don't receive them in order to be profitable, or to offset unfavourable market conditions, but to fulfil public-interest objectives," said Agrofert spokesman Pavel Heřmanský. According to him, subsidies account for roughly 0.8% of the group's total revenue.

It has previously been noted that without operating subsidies, many of Agrofert's agricultural companies would be running at a loss. Agriculture is currently the segment facing the greatest difficulties within the holding. When announcing the 2025 results, Agrofert board chairman Zbyněk Průša said the agricultural segment is expected to see weaker results, driven mainly by low market prices for crop products and falling milk prices.

Sharp rise in investment subsidies and energy support

Another form of state support — investment subsidies — grew significantly. Their volume for the holding rose nearly sixfold year-on-year, to CZK 401.6 million.

Agrofert has also become noticeably more active in tapping renewable energy support schemes. Thanks to top-up payments bringing electricity prices up to guaranteed purchase levels, the company received CZK 155.6 million in 2025 — up from just CZK 14.2 million the year before. The group's companies operate biogas plants and other renewable energy facilities.

Trouble in the chemical sector, and other risks

The biggest dividend payer to parent company Agrofert remains its chemical businesses, above all Přerov-based Precheza, which transferred CZK 800 million to the parent company.

The chemical division does, however, include some troubled assets. Deza, based in Valašské Meziříčí, was forced to partially halt production for the first time in its history in 2025 and posted a record loss of CZK 182 million. Plastics manufacturer Fatra, based in Napajedla in the Zlín Region, also fell into the red, with a loss of CZK 47.6 million.

An additional source of uncertainty for the holding is the conflict in Iran, which affects energy and raw-material prices — Gulf states are major exporters of urea, a key raw material for fertiliser production, one of Agrofert's core chemical business lines.

To save on scale and cut operating costs, Agrofert this year merged nine chemical companies into a new structure called AGF Nitrogen, which includes, among others, the Czech company Lovochemie, German fertiliser producer SKW Piesteritz, and Austrian company LAT Nitrogen.

A further risk to profits is the possibility of rising interest rates amid inflationary pressure: according to the holding's own calculations, a 50-basis-point rate hike would eat CZK 175 million out of profit. Agrofert's group bank loans grew by 12% year-on-year, to CZK 44.3 billion. In June, the Czech National Bank raised its key interest rate by a quarter of a percentage point, to 3.75%, despite pressure from Prime Minister Babiš, who opposed the hike — leading to a public clash with central bank governor Aleš Michl. The rate was left unchanged in August.

Read also: Savings accounts in Czechia: bank rates for 2026

Source: seznamzpravy.cz