Observer "Lietuva"

WEEK 9.2006

Saturday, 4th of March

Creditinfo buys Zvilgsnis Is Arciau
Iceland's Creditinfo Group has bought a 75 percent stake in the Lithuanian credit management and debt collection company Zvilgsnis Is Arciau from ZIA Valda. Zvilgsnis Is Arciau currently holds a 27 percent share of the out-of-court debt collection and 20 percent of the credit management services market in Lithuania. Gediminas Ziemelis, a ZIA Valda consultant, said the sale of Zvilgsnis Is Arciau was in line with ZIA Valda's plans to focus on real estate investment.
"Since Zvilgsnis Is Arciau accounted for just seven percent of ZIA Valda's investments, it was decided to hand the development of this business area over to a strong international network," he said. "ZIA Valda will concentrate on investing in the area of real estate in Lithuania and abroad."
Creditinfo Group provides credit information and credit management tools in 25 countries. In Lithuania, it also holds a 100 percent stake in Infobankas, which administers the biggest debtor information system in the country.
Respublika, Lietuvos Rytas

Nord/LB Lithuania to boost capital from retained earnings
Nord/LB Lietuva, the third-biggest Lithuanian commercial bank by assets, intends to increase its authorized capital by LTL 49.29 million to LTL 283.396 million from retained earnings. If shareholders approve the proposal, the bank will raise the nominal value of its existing shares by LTL 20, from LTL 95 to LTL 115. The bank's shareholders would be asked to distribute a total of LTL 57.92 million in profits at the general meeting on March 23.

Construction prices go up
Construction prices grew 0.6 percent in January 2006 compared to December 2005 in Lithuania. The prices of engineer constructions saw the highest growth – 0.9 percent, prices of construction materials and products increased by 0.5 percent, while the tariffs of construction machinery and mechanisms exploitation hours went up by 3.6 percent in the said period.

Friday, 3rd of March

Svyturys-Utenos lifts revenue to LTL 353.5 million
Lithuanian largest brewery Svyturys-Utenos Alus posted revenue of LTL 353.5 million for 2005, a rise of 16.7 percent from LTL 302.824 million in 2004. The company has not published its profit figures for 2005 yet. It reported a net profit of LTL 65.136 million for 2004 and paid a total of LTL 90.388 million in dividends last year.
Sales of beer, which remains the company's main product, rose by three percent to 130.5 million litres in 2005. Drinking water sales jumped by 32 percent to 15.05 million litres. Sales of its Kiss cider more than doubled last year, to 4.64 million litres.
This year the company has earmarked over LTL 15 million for investment. Around half of the money will be invested in production and the remainder will go toward marketing, new product development, innovation, personnel training and other programs.
Lietuvos Rytas, Verslo Zinios

Lisco Baltic Service buys new ship
Lisco Baltic Service, the Klaipeda-based ferry operator controlled by Denmark's shipping group DFDS, acquired a major ferry Svealand from Stena group, the leading international ferry operator. The new ship, which will be renamed Lisco Optima, will operate on the Klaipeda-Kiel line, after it is taken over in April. The value of the transaction has not been disclosed.
Earlier media reports said that a new ferry of similar parameters could cost up to EUR 300 million. LBS has been searching for a major ship, which could meet the demand on the market, since January, as Scandlines has ruled to withdraw from the Klaipeda-Kiel line.
The ferry operator currently operates 7 ferries, although it also renders cargo delivery services with tramp ships. The company offers passenger services on the lines Klaipeda-Kiel, Klaipeda-Karlshamn and Luebeck-Riga/Ventspils. The cargo delivery business on the Klaipeda-Karlshamn line was offloaded to DFDS.
Lietuvos Rytas, Verslo Zinios

BOD Group opens new disc plant in Estonia
BOD Group, the largest CD and DVD manufacturer in the Baltics, is opening a new factory in Tallinn on Thursday. The group, which has a factory in Vilnius, has invested LTL 7.7 million in its second production facility. The new factory has an annual production capacity of 5-6 million discs. There are plans to increase its annual output to 10 million discs in the future.
"We chose Tallinn because we are looking to consolidate our position not only in Estonia but in the Scandinavian markets as well," BOD Group CEO Vidmanas Janulevicius said.
Lietuvos Rytas, Verslo Zinios

Thursday, 2nd of March

Lithuanian GDP grows 7.5 percent in 2005
Lithuania's gross domestic product grew by 7.5 percent to LTL 71.001 billion in 2005 compared with 2004, according to a revised estimate from the Statistics Department. In the fourth quarter, the economy expanded by 8.8 percent year-on-year to LTL 19.558 billion. The full-year and fourth-quarter growth figures were revised up from previous estimates of 7.3 percent and 8.2 percent, respectively, in late January. GDP per capita for 2005 was LTL 20,800, up 8.1 percent compared with 2004.
The strongest year-on-year growth was recorded in construction, 13.8 percent; retail and wholesale trade, hotels and restaurants and transport and communications, 13.2 percent; industry, eight percent; and other services, 7.3 percent.
Kauno Diena, Respublika, Lietuvos Zinios, Lietuvos Rytas, Verslo Zinios

Neste Oil interested in Lithuania's talks with Yukos
Finland's Neste Oil has shown interest in the ongoing negotiations between the Lithuanian government and the embattled Russian oil company Yukos on Mazeikiu Nafta.Prime Minister Algirdas Brazauskas informed Neste Oil president Risto Rinne and vice-president Jarmo Honkamaa about the talks with Yukos during their meeting in Vilnius on Wednesday. Brazauskas reiterated his government's position that a potential buyer of a majority stake in Mazeikiu Nafta must guarantee oil supplies to the country's only crude refinery.
Lietuvos Rytas, Verslo Zinios

Klaipedos Baldai raises net earnings 7.5 percent
Klaipedos Baldai, the leading Lithuania's furniture maker controlled by diversified business group SBA, reported LTL 3.854 million in audited net earnings for full 2005, a rise of 7.5 percent from the year-earlier figure of LTL 3.586 million. The company pins its hope of further business expansion to the contract with Swedish furniture retailer IKEA. Klaipedos Baldai has obliged to supply over LTL 0.5 billion worth of furniture to the leading global furniture buyer in a four-year period.
Verslo Zinios

Wednesday, 1st of March

Inflation just 0.1 points above Maastricht target
Lithuania's 12-month average inflation rate, as measured by the Harmonized Index of Consumer Prices (HICP), was 2.7 percent in January, surpassing the Maastricht inflation target by just 0.1 percentage points.
"This is good news. The fact that the Maastricht reference value is raising improves our chances of complying with this criterion in the middle of this year," Alge Budryte, chief analyst at SEB Vilniaus Bankas, said.
"On the other hand, even if the Maastricht reference value remains at 2.6 percent, it will be very difficult for us (to meet it) unless a decline in consumer prices is recorded for at least one month," she added.
The Lithuanian Statistics Department forecasts that consumer prices have fallen by 0.1 percent in February from January. In order to comply with the Maastricht inflation criterion, Lithuania must keep its inflation rate within 1.5 percentage points of the three best-performing EU countries. That reference value stood at 2.6 percent in January, up from 2.5 percent in December.
Kauno Diena, Lietuvos Rytas, Lietuvos Zinios, Respublika, Verslo Zinios

Net earnings of PST surge fourfold over 2005
Panevezio Statybos Trestas (PST), the leading Lithuania building company, posted LTL 10.9 million in consolidated net earnings for full 2005, a surge of 4.2 times versus the year-earlier figure. The sales, at LTL 192 million, grew by 27.3 percent from 2004. The builder has also said it would invest approximately LTL 5 million into the upgrade of equipment and new technology this year. Last year PST received 34 percent of orders from the state and 66 percent of order from the private sectors.
Panevezio Keliai, a local company, owns 49.8 percent of PST shares. The Scandinavian investment bank Evli Group holds a 33.34 percent stake in the building firm.
Verslo Zinios, Lietuvos Rytas

Lithuania's talks with Yukos move to Tel Aviv
A Lithuanian government negotiator continues talks with representatives of Russia's embattled oil company Yukos over the oil refinery Mazeikiu Nafta in the Israeli capital of Tel Aviv this week. Saulius Specius, a member of the government's three-strong negotiating team, left for Tel Aviv on Monday. The Lithuanian official is holding talks with executives and shareholders of Yukos and its subsidiary companies on a buyout of Mazeikiu Nafta. There has been speculation that the government, which owns 40.6 percent of Mazeikiu Nafta, threatened to nationalize the oil refining and transportation complex in an attempt to pressure Yukos to listen to its demands. The government is seeking the cancellation of two Yukos-held options to buy more shares in Mazeikiu Nafta cheaply and is looking for an investor that could ensure stable crude oil supplies to the country's only oil refinery. But Yukos wants to sell its 53.7 percent stake for the highest price possible and is unwilling to make any concessions on that issue.
Lietuvos Rytas

Tuesday, 28th of February

Baltic PMs in favour of building new nuclear plant in Lithuania
Government leaders of the three Baltic countries have agreed to support the construction of a new nuclear power plant in Lithuania, setting out their determination in a joint communication signed after the Monday's meeting. Baltic energy companies, including Lietuvos Energija, Latvia's Latvenergo and Estonia's Eesti Energia, will be invited to invest into the new nuclear plant project. The actual works could be launched in approximately 7 years' time, said Estonia's Prime Minister Andrus Ansip. All three companies would need to set up a joint venture for the project and search for the sources of financing, he noted.
The design of new nuclear facility, which would be erected at the territory of Ignalina Nuclear Power Plant (INPP), specifically, on the site of third reactor that has never been completed, would take approximately 4 years to work out.
According to the communication, the three countries will work out a joint energy strategy for the Baltic countries this year. Moreover, the outlook for the development of LPG terminal and storage facilities will be studied.
Lietuvos Zinios, Respublika, Kauno Diena, Lietuvos Rytas, Verslo Zinios

Gubernija to raise authorized capital by LTL 11.214 million
Gubernija, the Siauliai-based beer producer majority-owned by publisher Vitas Tomkus, aims to raise its authorized capital by LTL 11.214 million, to LTL 33 million.
New shares will be sold to Tomkus and Siauliai-registered Linos Namai in equal parts. The buyers will acquire the stakes for LTL 5.607 million each. The shareholders of Gubernija will vote for the raising of capital at the meeting due on March 14. Tomkus acquired 43.89 percent of Gubernija for LTL 15.5 million last December.
Verslo Zinios

Consumer confidence declines 1 point in Lithuania in February
Consumer confidence index declined by 1 percentage point month-on-month, to reach minus 1 point in February, as the local population sounded more pessimistic about the outlook for domestic economy. However, if compared with February 2005, the index rose by 3 points. The number of respondents expecting economic growth and sliding unemployment in the upcoming twelve-month period declined in February.
Lietuvos Zinios, Respublika

Monday, 27th of February

Hopeful change of heads in Alytaus Tekstile
Virginija Graudiniene, former finance director of refrigerator maker Snaige, was appointed the CEO of Alytaus Tekstile, textile producer. Albinas Jasiulevicius, previous head of the Alytus-based textile company, resigned from the post. The board of the company expects that the new head of Alytaus Tekstile will actively contribute to the improvement of operations of the company.
Verslo Zinios, Lietuvos Rytas

Norfa Pharmacy asks permission to work
Norfa Pharmacy, newly established company of retail trade chain Norfa, is soon to address the Competition Council over the new pharmacies chain N. It is planned that the new N drugstores will start their activities in April while the number of the drugstores will grow up to 45 by the end of this year. Additional 40 N drugstores will be opened in 2007 whereas the entire chain should unite 130 pharmacies within 3 years.
Verslo Zinios

Pozityvios Investicijos change its status
Lithuanian central securities depositor has registered authorized capital of LTL 40,000 of UAB Pozityvios Investicijos that changed into AB Pozityvios Investicijos. AB Invalda that controls 75 percent of Pozityvios Investicijos decided to affiliate the company in the shareholders’ meeting on January 12. Reorganization of the company is to be completed until the middle of 2006.
Verslo Zinios

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