||Lithuania Business News: Archive 2003-
Saturday, 23rd of February
Average annual inflation rate reaches 6.3 percent
Lithuania's average annual inflation rate, as measured by the EU Harmonized Index of Consumer Prices (HICP), reached 6.3 percent in January, the Statistics Department reported on Friday. The HICP-measured average 12-month inflation rate is one of the key indicators for countries wishing to join the euro zone. The monthly inflation rate in January, as measured by the HICP, stood at 1.7 percent. The annual inflation rate was 10 percent. All of the HICP-measured inflation figures for January are 0.1 percentage point higher than the inflation rates measured by the national consumer price index, the department said.
Baltikums Draudimas bankrupts
Lithuania's Insurance Supervisory Commission (ISC) decided on Thursday to file a bankruptcy petition with the Vilnius Regional Court against the Latvian-owned insurance company Baltikums Draudimas, whose insurance license was suspended on December 11 last year due to financial problems. Without additional capital injections by shareholders or other investors, Baltikums Draudimas does not have sufficient financial resources to continue operating or to fulfill its obligations and exit the market, the insurance market watchdog said in a statement on Friday, explaining the reasons for its decision. Baltikums Draudimas must continue to fulfill all obligations under the existing insurance policies until the court opens bankruptcy proceedings against the company, it said. If the court accepts the petition, it will be the first bankruptcy of a Lithuanian non-life insurance company since the collapse of the Russian-owned insurer INGO Baltic in September 2005.
Respublika, Kauno Diena
Kruonis and Kaunas Hydro Power Plants will debut on the Vilnius Stock Exchange
Kruonis Hydro Pump Storage Plant and the Kaunas Hydro Power Plant, which will be split from the state-run power utility Lietuvos Energija (Lithuanian Energy), will debut on the Vilnius Stock Exchange (VSE) in future. The split of two power plants from Lietuvos Energija has been prescribed in the agreements between the government and private-equity NDX Energija on the establishment of Lithuania's energy holding Leo LT. Power Plants shall be split from the power utility within 24 months after the closure of the deal. Following the split, Leo LT would own 96.4 percent in each power plant, while small shareholders will own the remaining shares. Leo LT would then transfer its holdings in the power plants to the government for a symbolic price of LTL 1 within 30 business days.
Friday, 22nd of February
National debt raises
As a result of increased borrowing abroad, Lithuania's public debt rose by LTL 1.759 billion last year to reach LTL 16.698 billion, the Finance Ministry reported on Thursday.However, due to faster economic growth, the ratio of public debt to GDP fell from 18.2 percent to 17.3 percent, below the 17.6 percent target set in the 2007 convergence program, it said. Lithuania's foreign debt widened by LTL 1.008 billion last year to LTL 11.227 billion, accounting for 67.2 percent of the total public debt. At the end of the year, the state was LTL 10.904 billion in debt to foreign commercial banks and other financial institutions, and LTL 322.2 million to international organizations.
Kauno Diena, Respublika, Lietuvos Rytas
Siauliu Bank plans to issue new bonus
Lithuania's Siauliu Bankas, which is controlled by the European Bank for Reconstruction and Development (EBRD) and a group of local investors, said on Thursday that it was planning a new bonus issue this year but gave no details.
Siauliu Bankas' shareholders will be asked to approve the stock capital increase during their annual general meeting to be held on March 27. Other items on the agenda include profit distribution and appointment of new members of the supervisory board, the bank said.
Airports service more passengers
Total of 165,000 passengers went through Lithuania's airports in January, a rise of 16.5 percent compared with a year earlier, the Statistics Department reported on Thursday. The largest number of passengers flew to and from the United Kingdom (25,800 passengers or 15.7 percent of the total number), Ireland (21,200 or 12.9 percent), Germany (17,500 or 10.6 percent), Denmark (16,600 or 10 percent) and Egypt (14,900 or 9.1 percent). Compared with January 2007, the number of passengers going to and from Egypt and Ireland rose by 61.7 percent and 29 percent, respectively. The number of passengers travelling to and from Germany declined by 14.2 percent, UK and Denmark - 2.8 percent and 2.6 percent, respectively. Respublika, Verslo Zinios
Thursday, 21st of February
Female discrimination in Lithuania
There is not a single branch of economy in Lithuania in which average wages received by female employees exceeds that of male employees. Women are in an increasingly degenerating position in the labor market, with the average wage received by a woman in 2004 having been 81.4 percent in comparison to 79.2 percent of the average wage of a male employee last year, said Prime People recruiting, consulting and training company said, basing its statement on the data of the Statistics Department of Lithuania. Statisticians note that the net pay for women in Lithuania (excluding proprietorship) in the last quarter of last year was LTL 1296.2 in comparison to the LTL 1618.9 received by men. Prime People Director Ausra Delonaite noted that stereotypes about the roles of men and women are still evident in Lithuanian society, women are less encouraged to strive to make a career and are raised to be more family-oriented, however, she added that due to lack of employees, employers are changing their standpoint.
Respublika, Kauno Diena, Lietuvos Rytas
Dujotekana raises net profit by 27.1 percent
Dujotekana, a Lithuanian natural gas import and wholesale company indirectly controlled by Russia's gas giant Gazprom, raised the net profit by 21.7 percent, to LTL 24.061 million in 2006, from LTL 19.772 million a year earlier. The company paid out LTL 19.95 million in dividends in 2006, up from LTL 14 million a year earlier. As of late 2006, Dujotekana held 49.05 percent of Asocijuoto Turto Valdymas, and gained the indirect control of 40 percent of Russia's commercial bank Internacionalny Torgovy Bank in the second half of that year. The Lithuanian company held 39.52 percent in the bank via its 100-percent owned companies Rika and Oboroninvestprom, and a further 0.48 percent interest via the 36-percent owned company Krou-SB. Kauno Diena
Confusion in milk prices
Milk processors promised to decrease the prices for their products at the beginning of this month; however, the statistics shows that not all the prices went down. According to the data of the Agricultural Information and Countryside Business Centre, the prices for some milk products were still increasing in February. The price for one litre of milk grew by 3.6 percent up to LTL 2.58 until February 15. However, the prices of butter went down a little, from LTL 4.18 down to LTL 3.58 this month.
Lietuvos Rytas, Verslo Zinios
Wednesday, 20th February
Akmenes Cementas to sign three contracts
Akmenes Cementas, Lithuania's s Color ole cement manufacturer, was to sign on Tuesday three contracts worth over LTL 141 million in total to supply it with equipment for its planned new production line. Under the contracts, Akmenes Cementas will buy furnace equipment from Germany's KHD Humboldt Wedag, a clay crusher from Italy's Bedeschi and filters from Italy's CTP Team S.R.L., the Lithuanian company said in a statement. The signing of the contracts marks the completion of the first phase of a three-phase modernization project, it said. Now that the company has signed the contracts to acquire equipment for its new cement production line, it plans to finalize the details of and sign a design work contract with Sweco BKG LSPI. Akmenes Cementas has obtained LTL 212 million in bank loans to finance the biggest modernization project in its history, which involves shifting from wet to dry cement production technology.
Ukio Bank reports net profits
Lithuania's Ukio Bankas Group, which is controlled by entrepreneur Vladimir Romanov, reported on Tuesday LTL 75.4 million in consolidated net profits for 2007, a rise of 73 percent compared with the previous year. Ukio Bankas alone posted a net profit of LTL 82.5 million last year and its leasing subsidiaries netted LTL 2.7 million. Other subsidiary companies ended the year with losses of LTL 9.9 million, mostly due to their investment in a real estate project in Moscow, the bank said in a statement. The group's assets increased by 35 percent last year to LTL 4.32 billion, based on unaudited data. The net loan and lease portfolio more than doubled to LTL 2.14 billion and accounted for 50 percent of the total assets, up from 31 percent a year earlier.
Lithuania postpones the placement of Eurobonds
Lithuania's government has postponed the placement of 400 million euros issue of Eurobonds, which, according to revised schedules, will be distributed in the first half of this year. "The markets are interested in our securities, and Lithuania's position after the cutting of the country's rating by Standard & Poor's is also understandable. Yet we have not yet taken a decision to go on the market," Audrius Zelionis, director of state treasury department with the ministry of finance, said. Previously the authorities planned to place the 10-year issue in February, when the government was to redeem 200 million euros bonds. The said 200 million euros issue was redeemed using the budget funds and short-term borrowing instruments, Zalionis said.
Tuesday, 19th February
Grigiskes presents figures
Grigiskes, the largest Lithuania's hardboard and toilet paper manufacturer, sees the group's sales growing by 38.9 percent, year-on-year, to LTL 200 million. The pre-tax earnings are expected to surge by 53.8 percent versus 2007, to LTL 10 million.
For 2007 the group reported LTL 144 million in sales, up 20 percent from 2006. Full-year pre-tax profit declined by almost 10 percent, year-on-year, to LTL 6.5 million.
Respublika, Verslo Zinios
Lithuania's private equity power distribution company VST shows figures
Lithuania's private equity power distribution company VST reported LTL 67.2 million in unaudited net profit for full 2007, up 13 percent from the year-earlier audited figure of LTL 59.7 million. Last year the company invested LTL 140 million into electricity distribution grids and equipment and other fixed assets. This year the investments should at least equal last year's amount.
Respublika, Kauno Diena, Verslo Zinios
Snaige intends to issue new issue of convertible bonds
The board of Snaige, the sole Baltic household refrigerator producer, will ask for shareholders' approval for a new LTL 20 million issue of convertible bonds each with a face value of LTL 100. The shareholders would vote on the proposals at an extraordinary meeting due on March 7, the company said in a statement. The bonds will be distributed during 21 days after the approval of the prospectus by the Securities Commission. After 367 days from the end of the placement the securities might be converted into common stocks at a 1:18 ratio.
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