Observer "Lietuva"

Lithuania Business News: Archive 2003-2006

WEEK 22.2006

Saturday, 3rd of June

Utenos Mesa to supply meat to McDonald's
Utenos Mesa, one of the largest meat processors in Lithuania, is the first Baltic company to have acquired the right to supply meat products to McDonald's restaurants across Europe. The company said it expected to start supplies to the fast food chain in June.
"We will supply 300 to 400 tons of cooled, cut beef to restaurants in eastern European countries, Russia and Belarus, by the end of June and will increase supplies in the future," Utenos Mesa CEO Virginijus Kantauskas said.
The company received McDonald's quality certificate after the chain's auditors had conducted a quality audit of the plant in Utena, in eastern Lithuania.
Lietuvos Zinios, Lietuvos Rytas, Respublika

Vilniaus Baldai raises five-month sales by one tenth
Vilniaus Baldai, one of Lithuania's leading furniture manufacturers, posted sales of LTL 43.797 million for the first five months of 2006, a rise of 9.9 percent versus the year-earlier figure of LTL 39.86 million.
Owing to the launch of new products manufacturing, the pretax earnings of the furniture company plunged almost 11 times, to LTL 72,000 in the January-to-April period, the last period of published profit figure.
Lietuvos Zinios

Lietuvos Aidas publisher wins auction for ELTA news agency
Algirdas Pilvelis, the publisher and editor-of-chief of the Lietuvos Aidas daily newspaper, on Friday was formally named the winner of an auction for the state's 39.51 percent stake in the ELTA news agency, which is controlled by the Respublika Group. Rimantas Butkus, head of the Transactions Division at the State Property Fund, said that the respective protocol was signed on Friday.
Pilvelis, who bid LTL 1.777 million for the shares, said that on Friday he received the confirmation that he had won the auction.
That bid topped an offer of LTL 1.701 million from Vitas Tomkus, the publisher of the Respublika daily newspaper. The starting price for the state-owned stake at the auction, held in mid-February, was LTL 1.7 million. Ziniu Partneriai, a company controlled by Tomkus, holds an 18.43 percent interest in ELTA.
Lietuvos Rytas

Friday, 2nd of June

Pretax earnings of Apranga surge 4 times
Apranga, Lithuania's leading clothing retailer with operations in all three Baltic countries, posted LTL 3.348 million in unaudited pretax earnings for the first four months of 2006, a fourfold surge compared with the January-to-April period of 2005.
Meanwhile, according to the five-month sales figure published on Thursday, the consolidated turnover of the group stood at LTL 99.75 million in January-May, a surge of 41.1 percent from the year-earlier.
In January-May, the fastest growth in sales was in Latvia, at 53.6 percent. Sales in Lithuania rose by 38.4 percent and Estonian sales were up 30.6 percent.
Lietuvos Zinios

Hermis Capital sells Lithuanian Film Studios
Lithuanian investment company Hermis Capital has sold the Lithuanian Film Studios (LFS), which it bought in early 2004, through a repurchase agreement. Hermis Capital spokeswoman Kristina Ziaunyte declined to provide any details, but said that, in legal terms, the company remained the owner of the LFS. Nevertheless, the LFS is no longer on the list of Hermis Capital-controlled companies that is available on the investment firm's internet site. Hermis Capital purchased a 100 stake in the LFS from the state in a deal worth LTL 14.15 million in January 2004. In mid-2005, persons associated with Hermis Capital held a 52 percent stake in the film studio.
Hermis Capital has recently sold the country's biggest passenger bus operator, Kautra, which it bought in 2004, to raise money for new investment projects.
Lietuvos Rytas

Lithuania's parliament approves draft agreements on sale of Mazeikiu Nafta
Lithuania's parliament has given its approval to four draft agreements on the sale of shares in Mazeikiu Nafta, the sole Baltic oil refining and transportation complex, to Polish oil concern PKN Orlen. The key provisions of draft agreements won the backing of 97 MPs, with 1 vote against and seven abstentions.
The parliament gave its approval for the draft agreement on the purchase and sale of 30.66 percent of Mazeikiu Nafta, draft shareholders' agreement, draft agreement on the government's 10 percent option and the draft statement on the termination of 1999 and 2002 agreements unfavourable to Lithuania.
Kestutis Dauksys, acting economy minister, has confirmed that he would sign the agreements with PKN Orlen if duly authorized. He believes that the signing procedure could be held coming week after the scheduled arrival of representatives of the Polish company.
Nerijus Eidukevicius, vice-minister of economy, notified that the costs of sale of the shares in Mazeikiu Nafta for Lithuania would total approximately LTL 3 million, which would be paid to lawyers and other advisers.
Lietuvos Rytas, Verslo Zinios, Lietuvos Zinios, Respublika, Kauno Diena

Thursday, 1st of June

Average pension in Lithuania to rise from July
The average old-age pension in Lithuania is set to rise by some LTL 60 starting July after the government decided on Wednesday to increase the basic pension and the current year's insured income. The average state old-age pension should go up by more than 13 percent, from LTL 455.22 to LTL 515.36.
The government decided to raise the basic pension by LTL 30, from LTL 200 to LTL 230, and the current year's insured income by LTL 128, from LTL 1,084 to LTL 1,212, effective from July 1.
All recipients of state social insurance pensions, almost 900,000 people, stand to benefit from this increase. These include old-age pensioners, the disabled, orphans and other pension recipients.
Lietuvos Rytas, Respublika

Lithuanian PM says political crisis will not affect refinery sale
Lithuanian Prime Minister Algirdas Brazauskas, who announced his resignation on Wednesday, said that the political crisis in the country could not affect the sale of the Mazeikiu Nafta crude refinery. "God forbid if it were affected. Everything has been done as far as the legal side goes," Brazauskas said.
"Tomorrow, the Seimas should consider (draft agreements with PKN Orlen) on a priority basis. Practically, (the agreements) can be approved within one day. This will only be an approval of the key provisions. A decision must be taken as soon as possible because there may be outside factors that do not depend on us," he added.
It is expected that the agreement between the Lithuanian government and PKN Orlen on the sale of a 30.66 percent stake in Mazeikiu Nafta will be signed by mid-June and the transaction will be completed by the end of September.
Lietuvos Zinios, Verslo Zinios

Computers
Seimas leads among the state institutions in Lithuania in terms of computer number and their access to internet. In the beginning of 2006, 100 parliamentarians had 115.3 computers, almost the same as a year ago (115.6). The President’s Office and ministries had 110 and 108.7 computers per 100 officials respectively this year, the same as in early 2005.
Lietuvos Rytas

Wednesday, 31st of May

IT giants are based in Lithuania
Lithuania is home to over a half - 13 of 20 largest Baltic IT companies in terms of last year's revenues on IT services, the Baltic IT sector review published by the investment consultancy Prime Investment has shown. One-forth, or five of twenty largest Baltic IT companies are established in Estonia, while two are Latvia-based companies. Latvia's Exigen Group ranked the first in terms of last year's revenues on IT services, which the consultancy put at LTL 69 million. It was followed by Lithuania's Sonex Group (LTL 54 million) and Estonia's Microlink Eesti (LTL 28 million).
Lietuvos Zinios

Lithuania's Q1 GDP growth revised up to 8.8 percent
Lithuania's gross domestic product grew by 8.8 percent in the first quarter of this year compared with the same period a year ago. GDP in real prices totalled LTL 17.228 billion in January-March this year. The first-quarter GDP growth figure is up from the department's previous estimate of 8.1 percent in late April. According to the revised data, GDP per capita in the first quarter was LTL 5,062, up 9.2 percent from a year earlier but down 9.9 percent from the last quarter of 2005.
The upward revision was mostly due to new data on the construction sector, which recorded the strongest growth at 20.6 percent.
Kauno Diena, Lietuvos Zinios, Verslo Zinios, Respublika

Natural gas prices in Lithuania to rise by 13 percent from July
With an increase in natural gas prices supplied by Russia's gas giant Gazprom, natural gas bills in Lithuania will rise by 13 percent on average starting July 1. The National Control Commission for Prices and Energy said on Tuesday that it had approved Lietuvos Dujos' new natural gas prices for regulated consumers.
The natural gas price for consumers using up to 90 cubic meters annually will go up from LTL 1.24 to LTL 1.46 per m3 (VAT inclusive).
The fixed price component for users consuming from 90 to 800 m3 per year will rise from LTL 2 to LTL 2.35 per month, while the variable component will go up from LTL 0.9 to LTL 1 per m3.
For those consuming from 800 to 20,000 m3 per year, the fixed monthly price component will remain unchanged at LTL 12, while the variable component will grow from LTL 0.66 to LTL 0.76 per m3.
For those consuming from 20,000 to 100,000 m3 annually, the fixed monthly price component will remain unchanged at LTL 10.17, while the variable component will go up to LTL 636.75 per 1,000 m3.
Lietuvos Rytas, Kauno Diena

Tuesday, 30th of May

Dvarcioniu Keramika to slash capital by EUR 8.6 million
Dvarcioniu Keramika, the only manufacturer of ceramic tiles in the Baltics, intends to reduce its authorized share capital from LTL 49.527 million to LTL 19.81 million to clear its accumulated losses. This issue would be on the agenda of its shareholder meeting scheduled for July 1. If shareholders give the go-ahead, the nominal value of one share will be reduced from LTL 5 to LTL 2.
The tile manufacturer managed to trim its first-quarter losses to LTL 852,000 this year, down from LTL 2.47 million a year earlier, as sales jumped by 29.8 percent to LTL 11.246 million.
Verslo Zinios

KazMunayGaz to close office in Lithuania
Kazakhstan's state oil and gas company KazMunayGaz intends to close its representative office in Lithuania after its plans to buy Mazeikiu Nafta, the only crude refinery in the Baltics, fell through.
"KazMunayGaz's representative office in Lithuania will be closed and relocated to a Central European country, where several other major projects are underway," said Arijus Katauskas, head of the public relations firm Baltic Communication Partners, which represents the Kazakh company in Lithuania.
KazMunayGaz opened its representative office in Lithuania, the first in the Baltic countries, last July as it prepared to bid for a majority stake in Mazeikiu Nafta. Lietuvos Zinios, Verslo Zinios, Lietuvos Rytas

Salaries in Lithuania up 13 percent over one year
Average gross salaries in Lithuania's economy, excluding sole proprietorships, rose by 13.2 percent in the first quarter of 2006 from a year earlier figure, to reach LTL 1,437, but shrank by 1.1 percent from the last quarter of 2005. In the public sector, the average gross salary rose by 12.1 percent, year-on-year, to LTL 1,501, while in the private sector it grew by 14.4 percent, to reach LTL 1395. Over the quarter, the average in the public and private sectors shrank by 2.1 percent and 0,2 percent, respectively.
The annual growth in the average salaries rates resulted on the increase of minimum monthly wages to LTL 550 from July 2005, the hike of minimum hourly wages to LTL 3.28, from LTL 2.95, and a rise in salaries of healthcare and social workers.
Lietuvos Zinios, Verslo Zinios

Monday, 29th of May

Siauliu Bankas is set to raise authorized capital
Siauliu Bankas, one of the fastest-growing banks in Lithuania, aims to boost its authorized capital with the additional contributions from its current shareholders.
The board had not yet passed a decision over the specific scale of capital increase, yet, the amount of LTL 10-12 million was mentioned at the latest annual shareholders' meeting, Pranas Gedgaudas, the treasury department director at Siauliu Bankas, said.
"Previous years have shown that our plans and decisions have almost no differences," Gedgaudas noted.
The bank is due to call an extraordinary shareholders meeting to vote on the raising of authorized capital on July 4. In mid-May the bank completed the raising of share capital to LTL 94.039 million.
Lietuvos Zinios, Verslo Zinios

Invalda real estate fund fails IPO
The initial public offering (IPO) of the real estate management company Invaldos Nekilnojamojo Turto Fondas (Invalda Real Estate Fund, or INTF) has failed although the fund still believes it could debut on the Vilnius Stock Exchange (VSE) in future.
The demand in the company's shares was far below the expected. Still, the company, which aimed to float 49 percent of its shares, would seek to hold a new IPO, which should be successful, Vytautas Bucas, INTF CEO, said.
The company currently holds around LTL 160 million worth of real property. Its value will rise to about LTL 230 million after the planned takeover of buildings from Teo LT in June. The major shareholders of INTF will, as previously, include Invalda with a 56.21 percent holding and Nenuorama with a stake of 43.79 percent.
INFT posted LTL 2.85 million in net profit for full 2005, a rise of 17.8 percent versus the year-earlier figure of LTL 2.42 million.
Verslo Zinios, Lietuvos Zinios

PST incurs losses
One of the biggest Lithuania’s construction companies Panevezio Statybos Trestas (PST) has incurred losses of some tens of thousand litas due to the falling in of lining in Siauliai Sports and Entertainment Arena on Thursday. The object was insured. The technical incident was successfully liquidated and will not have effect on the further works.
Lietuvos Zinios

Previous weeks:
Estonia
Latvia
Lithuania

Back to Baltic Business Monitor
Archives 2003-2005

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