Observer "Lietuva"

WEEK 13.2006

Saturday, 1st of April

Siauliu Plentas wins most expensive military infrastructure reconstruction tender
Siauliu Plentas has won a LTL 55 million tender for reconstruction of the main runway at the First Air Force Base in Zokniai. The reconstruction would be financed from the NATO Security Investment Program (NSIP) allocating about LTL 47 million, with another LTL 8.5 million in value-added tax to be covered by the Lithuanian Defence Ministry from budgetary assignations. The contract between the Defence Ministry and Siauliu Plentas was signed on Friday after the company won a tender, defeating Finnish-capital firm Leminkainen Lietuva.
"This was the first tender of public acquisitions organized under international NATO procedures, and we are happy that a Lithuanian company won. Exceptional aspects of the tender were not only exceptional by procedures, but also by its value," The ministry's undersecretary in charge of acquisitions Jurate Raguckiene said.
The reconstruction should be started in May. According to the plan, the winner will reconstruct 280,000 m2 of the runway's paving and build additional 13,500 m2 of concrete at both ends of the runway.
Lietuvos Rytas

Lithuania's economic sentiment improves in March
Lithuania's economic sentiment indicator rose by four points in March compared with February and was up by eight points from March 2005, the Statistics Department said.
It said the month-on-month improvement was due mainly to an increase of six points to13 percent in the industrial confidence indicator because of stronger production expectations. Year-on-year, the industrial confidence indicator rose by nine points, consumer confidence by five points, confidence in the construction sector by 13 percent, confidence in the retail sector by 17 percent, and confidence in the services sector by six points.

Government fails to achieve any essential agreements in talks with Yukos over Mazeikiu Nafta
Lithuania's negotiators failed to achieve any essential agreements over the purchase of 53.7 percent stake of Mazeikiu Nafta at the Friday's meeting with Steven Theede, president of Russia's oil company Yukos, Theede said. Kestutis Dauksys, Minister of Economy and the leader of government-appointed task group of negotiators, said after the meeting that the price of controlling stake in the sole Baltic oil refining and transportation complex was one of the key sticking points at the talks.
The negotiators managed to achieve some progress, yet, the final agreement was not reached. The talks would continue, and the groups of negotiators expected to hold another meeting coming week, the minister added.
Lietuvos Rytas, Respublika, Kauno Diena

Friday, 31st of March

Construction prices up 0.3 percent in Lithuania in February
Construction prices in Lithuania rose by 0.3 percent in February versus January.
The Statistics Department attributed the increase to the 0.3 percent rise in wages and overhead costs and a 0.2 percent hike in the prices of construction materials and products. The index was also affected by a 0.6 percent increase in the per-hour cost of construction equipment operation.
The rise in the prices of construction materials and products resulted on a 0.9 percent hike in prices of electric engineering materials, 0.3 percent increase in the prices of pipes and 0.2 percent growth in the prices of insulation materials, various types of concrete and mixtures, windows and doors.
Lietuvos Zinios, Respublika, Verslo Zinios

PZU Lietuva ends 2005 in red
PZU Lietuva, the Lithuanian subsidiary of Poland's insurance giant PZU, said it ended last year with millions of litas of losses but did not give the exact figures.
"We operated at a loss last year. The financial loss was large, amounting to several million of litas, but it was significantly lower than the 2004 loss of around LTL 17 million," PZU Lietuva CEO Zenon Olbrys said.
Olbrys said that combined losses of PZU Lietuva could have reached around LTL 8-12 million, according to preliminary data. PZU Lietuva vice-president Gintautas Mazeika said that last year's performance results were adversely affected by a major restructuring, during which two life insurance and two non-life insurance companies were merged into a singe group.

Vilnius Vodka boosts profit to EUR 1 million
Vilniaus Degtine, one of Lithuania's leading alcoholic beverage producers, quadrupled its net profit to LTL 3.857 million in 2005 but does not intend to pay any dividends for the year. The Vilnius-based company, which is controlled by the French group Belvedere, said in a statement to the Vilnius Stock Exchange on Thursday that it had LTL 7.455 million in undistributed losses at the end of 2005.
Lietuvos Rytas

Thursday, 30th of March

Bjork Eklund buys into Lithuania's BGT transport group
Swedish liner agency and logistics provider Bjork Eklund has acquired 33 percent of Lithuania's Baltic Transport Group (BTG), the ocean freight forwarding, ground transport, logistics consulting and customs brokerage services provider.
The acquisition forms part of Bjork Eklund's continuing strategy to expand its operations in the Baltic States, Russia and other parts of the former Soviet Union.
"Together with our Finnish partners we will provide BTG with the resources to grow its business more rapidly than has been possible to date. We are planning to expand BTG's activities both geographically and in its scale of operations," Stefan Bjork, Bjork Eklund co-founder, said.
Lietuvos Rytas

Lukoil Baltija to invest LTL 6 million in Lithuanian fuel chain in 2006
Lukoil Baltija, which operates the largest retail fuel chain in Lithuania, has said it intends to invest around LTL 6 million in reconstructing its filling stations this year, up from LTL 3.4 million it invested last year. Lukoil Baltija owns a chain of 115 stations across Lithuania. The company said it plans to reconstruct 12 stations this year.
Lietuvos Rytas, Respublika

Lithuanian tourists make 18 percent more trips abroad
Some 1.3 million tourists from Lithuania travelled to foreign countries last year, 17.7 percent more than in 2004, the Statistics Department reported. The number of tourist arrivals in Lithuania rose by 4.8 percent to 2.3 million last year, while the number of one-day visits fell by 1.5 percent to 17.5 million.
Respublika, Lietuvos Zinios, Verslo Zinios

Wednesday, 29th of March

Hanner to launch building of new complex in Riga late in 2006
Lithuania's real estate developer Hanner aims to launch the construction of new office and apartment complex in Riga late in 2006. Investments into the new complex are scheduled to exceed LTL 100 million.
"We intend to build several multi-storey buildings with A-class offices and apartments close to the Olympia shopping centre," Arvydas Avulis, Hanner chairman and owner, said.
The construction of the complex at Kipsala, Riga, is expected to be completed by 2009.
Hanner's investments in Riga totalled LTL 4 million in 2005. The company aims to complete the construction of LTL 57 million worth complex of dwelling houses with over 340 apartments in the capital of Latvia by early 2007.
Verslo Zinios

Stumbras to allot new shares to employees, pay dividends
Stumbras, the largest Lithuania's distillery controlled by MG Baltic concern, aims to issue new shares to be allotted to employees and pay out LTL 17.858 million, or LTL 0.45 per share, in dividends from the 2005 net earnings of LTL 19.805 million.
The shareholders of Stumbras are to vote on the raising of authorized capital and dividends at the annual shareholders meeting. The shareholders are also expected to vote on the allocation of LTL 4 million into the own shares repurchase reserve.
Lietuvos Rytas

Bidders for Mazeikiai Oil offer similar financial terms
Lithuania's government is holding negotiations with three companies, which have offered similar financial terms for the purchase of controlling interest in Mazeikiu Nafta, Prime Minister Algirdas Brazauskas said. Brazauskas confirmed that the authorities held talks with three companies - Russia's oil giant Lukoil, Kazakh state-run oil and gas company KazMunayGaz and Russian-British joint venture TNK-BP, which were interested in the takeover of the sole Baltic oil refining and transportation complex.
Lithuania's government and Yukos have agreed the price for the 53.7 percent of Mazeikiu Nafta at USD 1.2 billion. Moreover, Yukos will also be paid dividends from the 2005 earnings of the sole Baltic oil refining and transportation complex.
TNK-BP, which took part in the first stage of Yukos' announced tender to buy 53.7 percent of Mazeikiu Nafta, reportedly bid some USD 600 million for the stake. Russia's Lukoil offered some USD 980 million in consortium with US ConocoPhillips. KazMunayGaz, which was included into the second stage of Yukos' tender and bid USD 1.2 billion for the stake, has already declared its intentions to buy a part of government's stake in the Lithuanian oil complex.
Respublika, Lietuvos Zinios, Lietuvos Rytas, Verslo Zinios, Kauno Diena

Tuesday, 28th of March

Vilniaus Kailiai mulling debut on stock exchange
Vilniaus Kailiai, the fur and leather clothes maker, aims to debut on the Vilnius Stock Exchange. The shareholders of the company will vote on the listing in the Current List of VSE at the meeting due on April 27.
"We believe that the listing will strengthen our image and guarantee the stability as we aim to proceed with the expansion of our business. We believe in success of that move," Leokadija Daubariene, Vilniaus Kailiai CEO noted.
The company posted LTL 3.328 million in net profit for full 2005, a surge of 3.7 times versus the year-earlier figure of LTL 897,400. Full-year sales increased by 5.3 percent, year-on-year, to LTL 7.608 million.
Verslo Zinios, Lietuvos Zinios, Lietuvos Rytas

British Airways to add additional flights on Vilnius-London route
British Airways, the largest UK air carrier that turned back to Lithuania's market after several years' break in 2005, will offer daily flights on its London-Vilnius-London route from Monday, March 27.
"The strategic decision of the company to resume flights from London to Vilnius has been absolutely justified, thus we decided to offer daily flights from London to Vilnius from March 27," Rasa Barisiene, British Airways sales and marketing manager in Lithuania, said.
The company made 260 flights on its London-Vilnius-London route within a year from its return on Lithuania's market on March 27, 2005. The carrier carried over 50,000 passengers, or one-third of all passenger traffic on that route.
Verslo Zinios, Lietuvos Rytas

Budget revenues 3.7 percent above target
Lithuania's national budget revenues reached LTL 2.553 billion in the first two months of 2006, 3.7 percent above the target. Revenues, including the European Union funds, came in at LTL 2.853 billion. The EU assistance totalled LTL 299.1 million in the January-to-February period, which accounts for 9 percent of full-year figure. Excluding the EU funds, the central government budget revenues made up LTL 2.191 billion, 2 percent above the target. With EU funds, the two-month revenue figure for the central government budget made up LTL 2.491 billion.
Lietuvos Rytas, Verslo Zinios, Lietuvos Zinios

Monday, 27th of March

MG Baltic completed reorganisation
MG Baltic concern sold some of the companies last year and focused on four main activity sectors; the concern controls 33 companies at present. This year, MG Baltic plans to boost turnover and raise sales by 25 percent. Darius Mockus, president of MG Baltic, says last year was an exceptional year since the main task of the concern was accomplished: its reorganisation was completed and now the concern focuses on four sectors – mass media, real estate, retail trade and production and sales of consumer goods. MG Baltic reported LTL 995 million in consolidated sales for full 2005, a rise of 5.3 percent from the year-earlier figure.
Pre-tax earnings, however, declined by 13 percent, year-on-year, to LTL 36.7 million.
Verslo Zinios

Vilniaus Vingis plans profit in spite of losses suffered last year
Having suffered LTL 5.59 million net loss last year, the electronic component producer AB Vilniaus Vingis plans to improve the results this year and operate profitably from now on.
Based on audited data for 2005, AB Vilniaus Vingis sold production for LTL 81.24 million, a 33.8 percent decline since the previous year, while the company’s turnover stood at LTL 122.8 million. Last year the company incurred LTL 5.59 million net loss.
In spite of poor results of the last year, Vilniaus Vingis plans to post LTL 1.1 million pre-tax profit and receive LTL 89 million revenues this year. Vaclovas Sleinota, director general of the company, says it is planned to gain profit from the secondary activities of the company.
Verslo Zinios

Unemployment rate shrinks to the lowest mark during five years
The unemployment rate in Lithuania amounted to 8.3 percent in 2005, by 3.1 percentage points lower than in the previous year. In fact, it was the lowest figure during the last five years, the Statistics Department announced.
According to the data of residents’ occupation study of the Statistics Department, 1.474 million residents had jobs in 2005. Number of the unemployed reduced by 51.5 thousand to 132.9 thousand people.
Last year majority of people worked in the processing industry sector (18.1 percent), trade (15.8 percent) and agriculture and forestry sectors (13.9 percent).
Lietuvos Zinios, Verslo Zinios, Kauno Diena

Previous weeks:

Back to Baltic Business Monitor
Archives 2003-2005

 TERMS & CONDITIONS / KÄYTTÖOIKEUDET. © Oy Compiler Ab. All rights reserved.