Observer "Lietuva"

WEEK 9.2005

Saturday, 5th of March

Beer market grew by 7.6 percent while exports by 51.5 percent
The Lithuanian beer market grew by 7.6 percent, to 29.58 million litres in the first two months of 2005, from LTL 27.49 million in the January-to-February period of 2004. In February alone, the sales of 7 major domestic brewers, which are the members of association, came in at 15.04 million litres, a rise of 6.7 percent from the year-earlier figure of LTL 14.09 million. Svyturys-Utenos Alus raised its two-month sales by 2.9 percent, to 13.84 million litres, from 13.45 million litres a year ago. Kalnapilis-Tauras Group ranked the second with two-month sales of 6.82 million litres, a rise of 9.6 percent from the sales of 6.22 million litres reported for the January-to-February period of last year. Ragutis raised its two-month sales by 10.5 percent, to 3.16 million litres, from 2.86 million litres a year ago. Svyturys-Utenos Alus held 46.8 percent of domestic beer market in terms of two-month sales, and was followed by Kalnapilis-Tauras Group with 23 percent, Ragutis with 10.7 percent, and Gubernija with 10.3 percent slice of Lithuania's beer market.
Lithuanian beer exports totalled 960,000 litres in the first two months of 2005, surging by 51.5 percent from the January-to-February period of 2004. Svyturys-Utenos Alus raised its beer exports by 3.5 percent, year-on-year, to 590,000 litres of beer in the first two months of 2005. Kalnapilis-Tauras Group ranked the second with 240,000 million litres in exports in January-to-February, a rise of 6 times from the first two months of 2004.
Respublika, Lietuvos Zinios

Dvarcioniu Keramika in the hands of Poles
A control stake of 60.3 percent of Dvarcioniu Keramika, Baltics' leading producer of ceramic tiles, was sold for LTL 11.5 million through 8 direct deals on the National Stock Exchange on Friday. Unofficial sources said, the stock of the producer was purchased by a Polish investor. The list of the stock sellers includes names of Lithuanian lawyer Ceslovas Okincicas, an offshore company Iberian Ceramics, company's president Juozas Raiselis, and foreign citizen Abdulaziz A M. Al Brahimas.
Burdened by big losses, Dvarcioniu Keramika carried loss of LTL 822,000 in 2004 versus LTL 6.9 million loss in 2003. The 2004 sales decreased 11.3 percent year-on-year.
Lietuvos Rytas, Lietuvos Zinios, Respublika

New hopes for producer of electronics
Ekranas, one of Europe's leading television colour picture tube (CPT) manufacturers, has cancelled plans to stop production for a week in March after more new orders have come in. "Markets have reacted to announcements by western European TV set producers about temporary halts in production or closures, and Ekranas' customers have increased their orders for TV tubes," Ekranas CEO Eimutis Zvybas said. Angelija Zokaitiene, Ekranas spokeswoman, said that the company has received increased orders from its existing customers, mostly western European companies.
Ekranas announced earlier this year that it planned to stop production on March 7 through 13, citing a continuing slowdown in the European electronics market.
Ekranas' annual net profit slumped down to LTL 1.2 million in 2004. This year it is projecting losses of LTL 10 million in view of the negative trends in the global market.
However, the company is targeting a 15 percent growth in sales in 2005, to at least 5.3 million units.
Lietuvos Zinios, Lietuvos Rytas

Friday, 4th of March

Klaipedos Baldai posts lower profits
Klaipedos Baldai, Lithuania's leading furniture producer, reported audited net earnings of LTL 3.586 million for full 2004, a decline of 8.3 percent from the year-earlier figure.
The board of Klaipeda-based company, which is controlled by Lithuania's multi-business group SBA, will propose to the general shareholders' meeting to shun from dividends and to channel free funds into investments. The earnings for 2004 would be invested into equipment and expansion of manufacturing. Company's shareholders will vote on profit distribution at the annual shareholders' meeting due on April 19. The furniture producer, which channels some 95 percent of total output for exports, posted a turnover of LTL 118.044 million for full 2004, a rise of 15.2 percent versus 2003.
Lietuvos Zinios, Verslo Zinios, Respublika

Registered unemployment declined 2 percent over a year
The registered unemployment decreased 2 percent in Lithuania in twelve months since March 2004, whereas the number of registered jobless accounted for 6.1 percent of able-bodied population, the Lithuanian Labour Exchange reported on Thursday. In March, the unemployment figure stayed unchanged. The highest unemployment was in northern municipalities of Akmene and Mazeikiai and southern municipality of Druskininkai, accounting for 15.7, 14, and 13.9 percent respectively. The lowest unemployment, 2.2 percent, was reported in the districts of Elektrenai and Trakai. By the way, Vilnius District is among the areas with the lowest (3.2 percent) unemployment rate.

New player of tourism market
Topturas, a new travel agency, has announced plans to establish itself in the Lithuanian tourist market. The company has the ambition to capture 15-18 percent of the domestic market for tours by bus in 2005. Topturas will join the club of the four other major travel chains in Lithuania: Novaturas, Tez Tour, Omnituras, and Horizon Travel. Overall, the country has about 200 small travel agencies dealing with in-bound, out-bound, and domestic tourism.
Lietuvos Rytas

Thursday, 3rd of March

Gubernija launches PET production
Gubernija, a major Lithuanian beer producer, has started up its new PET bottling workshop on Tuesday. Investments into the new bottling workshop exceeded LTL 5 million. With the startup of the new line Gubernija has finished the overhaul of its beer production and bottling processes, which ate up the investments of LTL 50 million and took more than five years to complete. The new workshop operates Sympak equipment adjusted for beer bottling in PET bottles of 1, 1.5 and 2-liter volume. New equipment minimised the contact between beer and air, which led to significant deceleration of biochemical processes and ensured long-term premium quality of the product.
Earlier Gubernija reported preliminary losses of LTL 4.859 million for full 2004, a surge of 3.3 times from the year-earlier figure. Early in September the brewer predicted that the annual losses would reach some LTL 1.4 million.
Lietuvos Rytas, Lietuvos Zinios, Respublika, Verslo Zinios

Scandinavians will look through Hronas windows
Hronas, Lithuania's leading window and facade manufacturer, is entering the Scandinavian market with a 1-million-euro order to produce aluminium and glass facade constructions for a complex of buildings of the chemical company Bioden Idec under construction in Copenhagen. This is the first order under a three-year partnership agreement between Hronas' facade unit and NCC Denmark Constructions, a unit of NCC, the largest construction group in Scandinavia.
The Vilnius-based company constructed the facades of a hotel in the Icelandic capital of Reykjavik in 2003.
Verslo Zinios, Lietuvos Rytas

Lisiplast to install novelties
Lisiplast, a producer of plastic goods in Alytus, will use LTL 1.9 million worth of EU assistance to upgrade its production facilities. The company wants to manufacture thicker plastic panels than it does now. The local refrigerator maker Snaige, as the major customer of Lisiplast, will buy the panels for its manufacturing company in Kaliningrad. In addition to Snaige, Lisiplast takes orders from a dozen minor customers. In Lithuania, only Lisiplast and Snaige can produce such plastic panels. Lisiplast generated sales of LTL 16 million last year. Sales did not grow because soaring oil prices lifted the prices for polystyrene.
Verslo Zinios

Wednesday, 2nd of March

Contradictory news from Vilniaus Vingis
Vilniaus Vingis, one of Europe's leading producers of deflection yokes for picture tubes, aims to earn a pre-tax profit of LTL 3.5 million in 2005 and to increase it to LTL 9.5 million by the end of 2008. The Vilnius-based company posted a net profit of LTL 4.6 million for 2004. Its annual sales fell by 4.1 percent to LTL 122.8 million last year. Vilniaus Vingis' management board on Monday approved performance targets for 2005 and strategic goals for 2006 through 2008. The company's pre-tax profit is projected to grow steadily to LTL 7 million in 2006, LTL 8 million in 2007 and LTL 9.5 million in 2008. Its sales are forecast to increase to at least LTL 127 million in 2005, LTL 130 million in 2006, LTL 135 million in 2007, and LTL 140 million in 2008.
Lietuvos Zinios, Verslo Zinios

Vilniaus Akropolis to affiliate analogous companies in Kaunas and Klaipeda
Vilniaus Akropolis, which controls the shopping and entertainment centre Akropolis in Vilnius, intends to affiliate Kauno Akropolis and Klaipedos Akropolis.
"The reorganization of the company should be completed by the end of this year, and we are doing that in order to make the administration and financing of the company, as well as many other things, more efficient," Mindaugas Marcinkevicius, the head of the boards of Vilniaus Akropolis, said.
The authorised capital of Vilniaus Akropolis stands at LTL 36.3 million, that of Kauno Akropolis amounts to LTL 1 million, and the capital of Klaipedos Akropolis equals LTL 143.9 million.
Vilniaus Akropolis is going to construct Maxima Baze, a supermarket, and Emitazas, a retailer of construction supplies and household goods, in Kaunas. The investment in Kaunas could reach LTL 250 million. At the same, Hyper Maxima in Klaipeda will be extended in size.
Kauno Diena, Respublika

Lithuanian receives 6 percent of Danish citizen’s salary
Lithuania belongs to the group of countries with lowest work pay in Europe. The Lithuanian wage accounts for 6 percent of the wage of a Danish citizen. "In 2001, the hourly work pay in Denmark was 135 times higher the hourly wage, for example, in Belarus, however the difference shrank to 34 times only by the end of February this year,” the Federation of European Employers, which looks into the wage differences in the European countries, reported on Tuesday.
In the meantime, Estonia, a Baltic neighbour of Lithuania, occupies the last position in the fourth group, and Latvia stands one position behind Lithuania.

Tuesday, 1st of March

Panevezio Keliai leads to Riga
Panevezio Keliai, one of Lithuania's leading road construction companies, has said it is in talks to buy a road construction firm in Riga, following last year's acquisition of a building material production and road construction business in Daugavpils. "Talks are underway to acquire another business in Riga," Virmantas Puidokas, CEO of Panevezio Keliai," said.
Panevezio Keliai owns a construction project management company, Constructus SIA, in the Latvian capital. Panevezio Keliai, which is based is based in Panevezys, in central Lithuania, has subsidiaries in Latvia, Russia's Kaliningrad region and Ukraine. Verslo Zinios

Income of Apranga is lower than expected
Apranga group, an operator of retail stores selling apparel, reported on Monday that its pre-tax profit before audit amounted to LTL 7.5 million in 2004. The company is under the control of MG Baltic concern. The pre-tax profit of Apranga stores alone was LTL 6.34 million. The top managers of Apranga say the group has failed to live up to its profit forecast of LTL 8 million due to very warm winter in the last quarter of 2004 and the currency rate change in Latvia. The Lithuanian owned retail chain currently runs 42 stores in the Baltic countries, among them 32 outlets in Lithuania, nine outlets in Latvia and one in Estonia.
Last year Apranga generated income of LTL 137 million, 44 percent higher than income in 2003. Sales edged up as a result of expansion.
Lietuvos Zinios, Verslo Zinios, Respublika

Dvarcioniu Keramika cut losses
Dvarcioniu Keramika, the leading manufacturer of ceramic tiles in the Baltics, posted annual losses of LTL 822,500 in 2004, down from losses of LTL 6.9 million in 2003. The company said its sales dropped by 11.6 percent to LTL 43.11 million in 2004. It expects to increase sales by around 14 percent to LTL 49 million this year.
"We focused on profitability rather than on increasing sales last year. Our profit margin rose by 12 percentage points to 39 percent during the year," Dana Cemnolonskiene, Dvarcioniu Keramika's economics director, said.
Lietuvos Zinios, Verslo Zinios, Respublika

Monday, 28th of February

Lithuania will not avoid expansion of airports
It would cost around LTL 1.488 billion for Lithuania to build a new airport or some LTL 427 million to expand the existing airport in the second-biggest city of Kaunas, according to preliminary estimates. According to a study carried out by the professional service company EKT, an expansion of the southern part of the Kaunas airport could be a cheaper alternative to building a new airport. The new airport would have a 3,200-meter-long runway and a passenger terminal with an annual capacity of 3.5 million passengers. It is believed that the project could attract funding from the EU.
Experts see little room for expansion at the Vilnius International Airport, the country's largest airport. The study points out that the current passenger terminal infrastructure can service 1.5 million passengers per year, a level that passenger traffic at the airport should reach in 2007.
Lietuvos Zinios, Respublika

Anyksciu Vynas incurred losses
Anyksciu Vynas, a major Lithuanian alcoholic beverage producer, posted losses of LTL 3.8 million for 2004, up from losses of LTL 7,500 in the previous year. Anyksciu Vynas said in a statement that one of the reasons why the losses increased was that Artrio-2, the largest distributor of its products, went bust. "The prolonged privatization process, poor apple harvest and the bankruptcy of our biggest wholesaler had a negative impact on our financial results," Rita Gaigaliene, representative of Anyksciu Vynas, said.
Verslo Zinios, Respublika

Money supply decreased in January
Total money supply in Lithuania slipped by 0.27 percent in January from December, to reach LTL 21.707 billion, the Bank of Lithuania has announced. Currency in circulation declined by 2.4 percent to LTL 5 billion, while litas-denominated demand deposits shrank by 2.9 percent to LTL 7.141 billion during the month. Demand deposits by other than financial companies and natural persons declined by LTL 166.9 million and LTL 178.7 million, respectively, during the month, while the demand deposits by other institutions increased by LTL 136 million. Time and savings deposits in litas rose by 3.9 percent, to LTL 5.165 billion during the month, while foreign currency deposits widened by 1.9 percent, to LTL 4.401 billion.
Verslo Zinios

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