Eastern Europe
Weekly Market Overview
Issue 18, May 13, 2008
Indices weekly change
Market View
Banks and companies raised USD 20bn on the world’s equity
capital markets last week in a sign of growing confidence among
investors that the worst of the financial crisis may be over. Equity
capital markets only saw more activity the week after the rescue of
investment bank Bear Stearns on March 16 – seen by many bankers
and investors as the trigger for improving sentiment.
Chinese stocks suffered a steep sell-off on Wednesday as concerns
about inflation and economic growth gathered pace. The Shanghai
composite index tumbled 4.1% to 3,579.15 points. Consumer price
inflation data for April is due out next Monday, and analysts expect
only a moderate easing from the 8.3% rate recorded in March – well
above the government’s target of 4.8%.
OMX Vilnius
OMX Tallinn
OMX Riga
RTS Russia
WSE Poland
Prague
Budapest
Bucharest
PFTS Ukraine
CROBEX Zagreb
SOFIX Bulgaria
439
615
542
2284
47599
1637
23119
6950
914
3917
1142
Weekly
change
YTD
change
-0.7%
+2.3%
+2.7%
+6.7%
+0.4%
-0.5%
+1.0%
-2.8%
+3.2%
+5.9%
+0.4%
-14.6%
-17.1%
-8.9%
-0.3%
-14.5%
-9.8%
-11.9%
-29.3%
-21.7%
-25.2%
-35.4%
Oil prices set new records each day this week and spiked above USD 126 a barrel as traders asked where crude’s bull run
might end. Continuing supply problems in Nigeria provided fundamental support, but it was a warning this week from
Goldman Sachs that oil prices could reach USD 200 a barrel that sent oil bears running for cover.
The euro dropped to a two-month low against the dollar this week as a growing feeling that the single currency might have
peaked gripped the market. The euro, which just last month hit a record high of USD 1.6018 against the dollar, plunged to
a low of USD 1.5287 on Thursday.
Baltic Markets
Stocks to watch
Sector
Ūkio bankas
Olympic Ent. group
TEO
Apranga
Baltika
Silvano Fashion Group
Banking
Entertainment
Telecom
Retail
Retail
Retail
Ticker
Last price
UKB1L
OEG1T
TEO1L
APG1L
BLT1T
SFGAT
LTL 3.22
EUR 2.53
LTL 2.01
LTL 9.140
EUR 2.36
EUR 3.12
Mcap
EUR million
183
382
452
93
44
125
P/E
trailing
8
16
9
14
85
8
EV/
EBITDA
8
4
7
8
5
Weekly
change
+1.3%
-0.8%
0.0%
+1.6%
+4.9%
+4%
YTD
change
-13%
-28%
-15%
-36%
-39%
-29%
News
Olympic Casino Q1 2008 results
OEG1T consolidated unaudited operating results for Q1, 2008
Revenue: EUR 44.419bn (yoy +50.7%)
MP Investment Bank | Skipholt 50d | 105 Reykjavik | Iceland | Tel +354 540 3200 | Fax +354 540 3201 | info@mp.is | www.mp.is
Net profit: EUR 3.956bn (yoy -25.1%)
Consolidated revenue for Q1 2008 was positively influenced by the contribution of newly acquired companies as well
as organic and expansion-triggered revenue growth. At the end of March 2008, the group had 125 casinos with a total
area of 35,630 m2. The number of casinos increased by 43 compared to the same period of last year. Consolidated net
profit for the first 3 months of 2008 was affected by unrealised exchange differences - a net exchange loss of EUR 0.9m
as a result of significant fluctuations in the euro-US dollar exchange rate.
Baltika April sales
BLT1T consolidated net sales in April totalled EUR 6.17m and increased by 10% compared to April the previous year.
Retail sales grew by 15% yoy to reach EUR 5.4m. Baltika’s April retail sales grew 45% in Poland, 21% in Russia, 18% in
Latvia, 14% in Ukraine, 9% in Estonia and 5% in Lithuania. At the end of the month, the group had 125 stores with a
total sales area of 24,462 m2. In the same month, the group opened a store in Kaliningrad, Russia, entering into a new
city. BLT1T’s cumulative 4-month sales amounted to EUR 23.2m (up 2% yoy), including retail sales of EUR 19.8m (up 8%).
Apranga April sales
APG1L reported retail turnover (including VAT ) of LTL 39m in April 2008, 28.8% more than in April 2007. Retail turnover
(including VAT ) was LTL 160.5m in January to April, an increase of 31.5% comparing to the corresponding period of
2007. Apranga Group has opened 3 new stores in 2008: S.Oliver in Riga, and Aprangos Galerija and Stradivarius in
Vilnius. The group currently operates a chain of 86 stores (57 in Lithuania, 24 in Latvia, and 5 in Estonia).
.
APG1L versus BLT1T
APR sales without VAT
EUR m (% yoy)
4 months sales without
P/S
VAT EUR m(% yoy)
P/E
APG1L
9.57 (+28.8%)
39.4 (+31.5%)
0.81
14.3
Last price
2008-05-06
(% ytd)
LTL 9.22 (-35.9%)
BLT1T
6.17 (+10%)
23.2 (+1%)
0.59
95
EUR 2.36 (-39.5%)
MCAP
EUR m
94
44
Investors’ calendar
Date
Company
Event
10 May
UKB1L
2008 4 months results
30 May
APG1L
Q1 2008 results
30 May
IVL1L
Q1 2008 results
MP Investment Bank | Skipholt 50d | 105 Reykjavik | Iceland | Tel +354 540 3200 | Fax +354 540 3201 | info@mp.is | www.mp.is
Russia
Stocks to watch
Unified Energy
X5
Magnit
Sberbank
VTB
Sector
Ticker
Last price
USD
Mcap
USD million
P/E
trailing
EV/
EBITDA ‘06
Weekly
change
YTD
change
Energy
Retail
Retail
Banking
Banking
UESD LI
FIVE LI
MGNT
SBER RU
VTBR LI
104.5
34.2
44.4
3.44
7.9
42888
7403
3197
74259
26560
42
54
10
29
23
+9.7%
-2.3%
+1.5%
+0.5%
+2.5%
-19.6%
-6.3%
-12.1%
-18.5%
-22.5%
21
News
Goldman Sachs lifts 12-month estimate for Russia’s RTS to 2,750
Russia’s RTS Index may climb 20% in the next year, led by oil companies amid record crude prices, Goldman Sachs Group
Inc. said. The New York securities firm raised its 12-month estimate for the dollar-denominated RTS by 12% to 2,750,
recommending shares in OAO Gazprom, the world’s biggest natural-gas company, OAO Lukoil, Russia’s second-biggest oil
producer, and OAO Surgutneftegaz, the fourth-biggest oil producer.
Hungary and Poland may adopt euro in 2013, UniCredit says
Euro-adoption targets for most central and eastern European nations have been pushed back as far as 2013 and 2014
because of accelerating inflation, said UniCredit Group SpA, Italy’s largest bank. Hungary, Poland and the Czech Republic,
which joined the European Union in 2004, will be able to adopt the single currency by 2013. Bulgaria and Romania, which
joined the 27-nation bloc in 2007, will meet terms for euro adoption by 2014, the bank forecast. “The prospect of euro
adoption is an important anchor for most countries that joined the EU in 2004 and 2007,” Unicredit said. “Meeting the
inflation criterion poses a special challenge, because of the price pressure observed almost all over central and eastern
Europe.”
Central Eastern Europe
Stocks to watch
ČEZ group
MOL group
Synergon Holding
Country
Sector
Ticker
Last price
Mcap
USD million
P/E
trailing
Czech Rep.
Hungary
Bulgaria
Energy
Oil
Holding
CEZ
MOL
PETHL
CZK 1241
HUF 23575
BGL 8.62
44063
12418
110
17
9
9
EV/
EBITDA
Weekly
change
YTD
change
9
+0.8%
+1.2%
+0.6%
-9.0%
-3.8%
-41.0%
News
Exxon, Mol may ship Hungarian gas to rest of Europe
Exxon Mobil Corp., Mol Nyrt. and Falcon Oil & Gas Ltd. may ship Hungarian natural gas to western Europe to boost
supplies in a region increasingly concerned that Russia may reduce exports. Gas from Mako, a collection of fields twice
the size of Los Angeles, could loosen OAO Gazprom’s hold over European supplies. Demand in the 27-member European
Union, the largest energy consumer after the U.S., rose by about 10% in the past five years. The urgency of finding new
fuel sources intensified after European shipments were reduced when Gazprom cut supplies to Ukraine in 2006 over a
pricing dispute.
MP Investment Bank | Skipholt 50d | 105 Reykjavik | Iceland | Tel +354 540 3200 | Fax +354 540 3201 | info@mp.is | www.mp.is
Company of the week
AS Tallink Grupp is the leading European ferry operator offering high-quality
mini-cruise, passenger transport services and roll-on roll-off cargo services in
the Baltic Sea. The company owns and operates passenger ferries, including
cruise ferries, fast ro-pax ferries, ro-ro cargo vessels and a high-speed ferry.
Current routes connect Estonia and Finland, Sweden and Finland, Estonia
and Sweden, Finland and Germany, and Latvia and Sweden. Altogether,
Tallink transported nearly 7m passengers and approximately 360,000 ro-ro
cargo units in the financial year up to 31 August 2007. The company also
operates two hotels in Tallinn.
AS Tallink Grupp
Ticker
Price EUR
Mcap EUR m
P/E trailing
P/S
TAL1T
0.81
543
9.1
0.7
Stock chart for 1 year:
Reasearch:
Gintare Urbanovič - Financial Analyst - Tel +370 526 39981 - gintare@mp.is
Eastern European Trading Desk:
Darius Krizinauskas, Specialist – Tel +354 540 3217 – darius@mp.is
Mindaugas Gataveckas, Specialist – Tel +370 5 212 76 09 – mindaugas@mp.is
This report is written by employees of MP Investment Bank for information purposes only and is not an offer or solicitation to deal in any security. The estimates,
opinions and forecasts reflect our good-faith judgment at the date of publication, and they may change without notice. Although the information published in
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MP Investment Bank | Skipholt 50d | 105 Reykjavik | Iceland | Tel +354 540 3200 | Fax +354 540 3201 | info@mp.is | www.mp.is