||Lithuania Business News: Archive 2003-2006
Saturday, 10th of June
Lithuania signs Mazeikiu Nafta agreements with PKN Orlen
After more than a year of negotiations with potential buyers of Mazeikiu Nafta, the Lithuanian government signed on Friday agreements that will make Poland's PKN Orlen the owner of the country's only oil refinery. Economy Minister Kestutis Dauksys signed an agreement on the sale a 30.66 percent stake in Mazeikiu Nafta, a shareholders agreement, agreements on an option to sell another 10 percent of shares and supplements to these agreements, and a deed on cancellation of agreements signed with the US company Williams International in 1999 and with Russia's Yukos in 2002. Mazeikiu Nafta chairman Nerijus Eidukevicius signed the latter document as well. PKN Orlen inked the documents on May 19.
The government will receive USD 851.829 million for its 30.66 percent stake in Mazeikiu Nafta after the transaction is completed, which is expected to happen by the end of September or, at the latest, by the end of March next year. It will also have an option to sell its remaining 10 percent stake to the Polish oil group within a five-year period.
Lietuvos Rytas, Kauno Diena, Lietuvos Zinios
Cinema, Internet, TV advertising grows fast in Lithuania
Advertising in cinema and on the Internet and television grew at a faster rate in the first four months of this year than advertising in other media, data from the market research company TNS Gallup showed. The overall volume of cinema advertising more than quadrupled in year-on-year terms. Revenues from online advertising soared by 67.9 percent in the reporting period.
The top advertisers in the five months were Procter & Gamble, Tele2 and TV Market.
New product in beer market
Lithuanias beer market leader Svyturys-Utenos Alus, controlled by Scandinavian company Baltic Beverages Holding, launched the production of light alcoholic drink Utenos D-light made of Pilsener beer and natural lemon juice. The company invested LTL 1.46 million in the new product. It is a new category drink in the Lithuanian beer market, since other similar products are produced while mixing beer with aromatic substances, Rolandas Virsilas, CEO of Svyturys-Utenos Alus, says.
Friday, 9th of June
Vilkyskiu Pienine raises sales 40 percent
Vilkyskiu Pienine, the leading Lithuania's hard cheese producer, posted sales of LTL 34.42 million for the first five months of 2006, a surge of 40.2 percent versus the year-earlier figure. In May alone, the sales soared by 34.14 percent, year-on-year, to LTL 7.74 million. The company is projecting its pretax earnings to surge by 48.2 percent, year-on-year, to LTL 7.7 million in 2006. The sales are seen growing by 22.9 percent, to LTL 112.8 million, with the net profit due to soar by 44.9 percent, to LTL 6.2 million.
Lietuvos Zinios, Verslo Zinios
Average annual inflation stood at 2.9 percent in May
Lithuania's average annual inflation made up 2.9 percent in May. Compared with April, the consumer prices in the country edged up by 0.4 percent. The consumer price index rose by 3.6 percent in May from the same period a year ago. The consumer price index in May was mostly affected by a 1.1 percent rise in the prices of foodstuffs and soft drinks, although that increase was partially offset by a 0.7 percent decline in the prices of goods and services in the transport group. The prices of consumer goods and services rose by 0.4 percent and 0.6 percent, respectively, over May.
Lietuvos Zinios, Respublika, Verslo Zinios
EUR 2.7 billion earmarked for Lithuanian rural development in 2006-2008
Some LTL 9.4 billion of EU, state and private funds has been earmarked for Lithuania's rural development program in the years 2006 through 2008. The amount of funding may still be revised in line with the EU's 2007-2013 Financial Perspective and the state budget for 2007-2008.
"This program gives special attention to collaboration between the ministry and self-government institutions in working out and implementing a strategy for an even regional development," Zita Duchovskiene of the Agriculture Ministry said.
Thursday, 8th of June
Lithuanian beer market grows 4.8 percent in the first quarter
The Lithuanian beer market grew by 4.8 percent to 97 million litres in the first five months of this year from a year earlier. Svyturys-Utenos Alus posted a 4.7 percent growth in beer sales for January-May to 46.22 million litres. However, its market share shrank to 47.59 percent from 48 percent a year earlier. Kalnapilio-Tauro Grupe raised beer sales by 11.9 percent year-on-year to 23.95 million litres. Its market share increased to 24.46 percent from 23.28 percent.
DnB Nord warns of looming bankruptcy of Alytaus Tekstile
Alytaus Tekstile, the embattled textile producer and once the largest Lithuania's light industry company, has poor chances to avoid bankruptcy, the analysts of Lithuanian commercial bank DnB Nord have projected in their latest Lithuanian economy review. The only chance to survive could be offered by a new strategic investor, they projected.
Meanwhile, the managers of the debt-ridden company believe that the textile producer would achieve a breakthrough and post LTL 2.3 million in net profit for 2006.
Last year the audited losses of the company came in at LTL 15.995 million, some 2 percent above the year earlier losses of LTL 15.673 million. Annual revenues shrank by 8.2 percent, to LTL 69.999 million, from LTL 76.277 million in 2004.
DnB Nord forecasts 6.5 percent GDP growth for Lithuania in 2006
DnB Nord, the third biggest Lithuanian bank by assets, forecasts that the country's GDP growth will reach 6.5 percent this year and decelerate to 5.5 percent next year.
In its latest survey of the Lithuanian economy, the bank predicts that the annual inflation rate will stand at 3.2 percent this year and fall to 2.8 percent next year. The current account deficit is expected to reach eight percent of GDP in 2006 and narrow to seven percent in 2007. The unemployment rate is projected at 5.5 percent and 4.5 percent in the respective years.
Lietuvos Rytas, Respublika
Wednesday, 7th of June
Alytaus Tekstile targets profit, 26 percent sales growth
Lithuanian cotton textile manufacturer Alytaus Tekstile is projecting a net profit of LTL 2.3 million this year after posting a loss of LTL 15.995 million last year. Annual sales are forecast to grow by 26 percent to LTL 87.8 million, according to the company's 2005 annual report-prospectus.
Nerijus Eidukevicius, Lithuania's deputy economy minister and chairman of Alytaus Tekstile, has said earlier that the company can return to profit this year if it solves working capital shortage problems and ensures uninterrupted production.
Thomson interested in development of manufacturing at Ekranas
Thomson, the leading global picture tube and TV set manufacturer, and several Lithuania's companies sound interested in possibilities to develop manufacturing at the premises of Ekranas, bankrupt Lithuania's colour picture tube producer. Gintaras Gelcys, CEO of Baklis, the court-appointed Ekranas' administrator in bankruptcy, said that the administrator had only held preliminary meetings with potential investors.
"They are interested in possibilities to carry out picture tube assembly in Panevezys, however, any talks about any specific agreements would be absolutely premature," Gelcys noted.
The outlook for talks with potential investors would largely depend on the decision of major creditors concerning the disposal of Ekranas' assets.
Number of riches on rise in Lithuania
The number of private individuals who declared the annual income above LTL 1 million surged 2.5 times in Lithuania over last two years. Tax inspectors attribute the increase to economic development and successful fight against illegal salaries. According to preliminary estimations by the State Tax Inspectorate, the number of millionaires is growing and the average declared amount per capita is rising as well.
Alge Budryte, chief analyst with SEB Vilniaus Bankas, said that the rise in the number of millionaires was natural considering the fast growth of national economy.
Tuesday, 6th of June
Lithuanian unemployment down to 3.1 percent in May
Lithuania's unemployment rate fell to 3.1 percent in May from 3.5 percent in April and was down from 4.8 percent a year earlier. The number of officially registered unemployed people was 65,500 as of June 1, a decrease of 12.2 percent, or 9,100 jobless, from a month ago. The highest unemployment rate was in the Ignalina district, 8.5 percent, while the lowest was in the districts of Trakai and Elektrenai, 0.8 percent each. Among major cities and towns, the highest jobless rate was in Panevezys, 2.7 percent, while the lowest was in Siauliai, 1.6 percent.
Crude handling at Butinge terminal down 3.8 percent in Jan-May
Lithuania's Butinge terminal, which is owned by Mazeikiu Nafta, handled 2.03 million tons of crude oil during the first five months of this year, a decline of 3.8 percent versus the year-earlier figure of 2.109 million tons. In May alone, the handling plunged by 11.4 percent, to slightly more than 620,000 tons, down from almost 700,000 tons in May 2005, the Klaipeda Port Authority reported.
Government awards powers to sign deal on sale of Mazeikiu Nafta
The government has authorized acting Economy Minister Kestutis Dauksys to sign the agreements on the sale of almost one-third of Mazeikiu Nafta to Poland's oil concern PKN Orlen. The government is set to sell PKN Orlen a total of 30.66 percent of Mazeikiu Nafta for USD 851.829 million. The deal is expected to be finalized by September 30 or by March 31, 2007. Yet, all other terms and conditions should be fulfilled by September 30.
Lietuvos Zinios, Respublika
Monday, 5th of June
New player emerges in Lithuanian lottery market
Garsuva is the fifth company in Lithuania to have obtained a license to operate national lotteries. The State Gaming Control Commission (SGCC) issued a license Garsuva on Friday.
"The company did not say to us what kind of lotteries it would operate, but said that its activities would cover many areas, including television lotteries," Andrius Karaliunas, the SGCC administration director, said.
The company must stop all other commercial activities within 60 days after the license was issued, he added. According to information available to the public, Garsuva is engaged in activities related to communications equipment.
The other four holders of licenses to operate national lotteries are Olifeja, Zalgirio Loto, Fortuna Baltica and Televizijos Loterijos.
Ober-Haus sold more real estate objects
Real estate company Ober-Haus, operating in the Baltic States and Poland, sold new flats at a price of LTL 250 million last year, a rise of two times since 2004. The company sold a total of 700 objects in Lithuania. The turnover of Ober-Haus grew 53 percent to LTL 11 million in 2005.
Food prices increase
The price of the basket of the basic food products grew 4.1 percent or LTL 9.52 to LTL 242.01 over the five first months of this year in the retail trade chains. Solely in May, the price of the foodstuffs basket increased LTL 2.31. Higher prices of grain, poultry and some vegetables predetermined the growth of baskets price. The price of basic food products basket amounted to LTL 232.49 in the beginning of 2006.
Verslo Zinios, Lietuvos Zinios
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