Observer "Lietuva"
Lithuania Business News: Archive 2003-

WEEK 32.2008

Saturday, 9th of August

Nuclear Power Plant posts figures
Lithuania's Ignalina Nuclear Power Plant (INPP) posted a pre-tax profit of LTL 77.5 million for the first half of this year, up 17.8 percent from LTL 65.8 million in the same period last year. The INPP's first-half operating profit came in at LTL 72.7 million and its profit from financial investment activities reached LTL 4.8 million, the plant's economics and finance director, Eugenijus Grumskas, said. The Ignalina plant's sales revenue for the first six months rose by 8 percent year-on-year to LTL 344.7 million, he said. The plant's annual net profit halved last year compared with 2006 to LTL 6.1 million as pre-tax profit slumped down by 41.9 percent to LTL 11.1 million. Full-year sales revenue increased by 7.4 percent to LTL 572 million.
Kauno Diena

Vilnius Furniture presents losses
Lithuania's Vilniaus Baldai (Vilnius Furniture), which is owned by Invalda, said on Friday that it expected a net loss of LTL 600,000 for the full year 2008, replacing its previous forecast of a net profit of LTL 5.8 million. The company said it had cut its annual sales revenue target to LTL 148.6 million, down 25.5 percent from LTL 199.5 million previously, and to lower its EBITDA estimate to LTL 12.7 million, down by 36.4 percent from LTL 19.96 million. The furniture manufacturer revised its annual targets after its first-half performance results came in below expectations. "The gap between the estimate and the actual result was due to the introduction into production of three new products simultaneously, which caused problems with the organization of the production process," Vilniaus Baldai CEO Nerijus Pacevicius said in a press release.
Respublika

Akropolis is sold
Germany's Deka Immobilien has purchased the Akropolis shopping and entertainment center in Lithuania's second-biggest city of Kaunas from the Vilniaus Prekyba Group for an undisclosed sum of money. The German investors have bought 100 percent of shares in Kauno Audiniu Projektas, a Vilniaus Prekyba Group company that owns the buildings of the Akropolis mall in Kaunas, Vilniaus Prekyba said on Friday. The market value of the shopping center is estimated at around a billion litas. This is Deka Immobilien's second investment in Lithuania. Last year it purchased the BIG shopping center in Vilnius for Deka-S-Property Fund No.2. In the Kaunas mall acquisition, Deka Immobilien represented the WestInvest InterSelect fund. The DekaBank Group is the largest operator of open-ended property funds in Germany. Its capital investment companies Deka Immobilien Investment and WestInvest Gesellschaft fuer Immobilienfonds together manage fund assets of about EUR 18 billion.
Respublika, Lietuvos Zinios, Kauno Diena

Friday, 8th of August

FlyLAL leads in Vilnius airport
FlyLAL-Lithuanian Airlines retained the lead in terms of passenger traffic at Vilnius International Airport for the fifth month in a row in July, the airport said on Thursday.
Last month FlyLAL, Lithuania's flagship carrier, accounted for 37.47 percent of total passenger traffic, Arunas Marcinkevicius, the airport's spokesman, said. Airbaltic ranked the second with a share of 32.2 percent, while Aurela, the charter carrier, was the third with the traffic share of 10.19 percent. The gap between FlyLAL and Airbaltic widened to 5.3 percentage points in July, from 4.2 points in June.
Verslo Zinios

IKI grocery chain raises sales
Iki, the second largest Lithuania's grocery chain, raised the sales by 22 percent, year-on-year, to LTL 1.254 billion, in Lithuania and Latvia in the first half of this year. In 2007 the chain's turnover in Lithuania and Latvia grew by one-third to 641 million euros. In 2008 the sales are seen reaching 800 million euros. Iki chain currently includes 187 outlets in Lithuania and 36 stores in Latvia. Coopernic alliance, the second largest foodstuff trade organization in Europe, acquired 80 percent of Iki earlier this year. The founders of the alliance set up back in 2006 include Germany's Rewe, Belgium's Colruyt, Italy's Conad, Switzerland's Coop and France's E.Leclerc.
Verslo Zinios, Respublika

Producer prices soar
Producer prices soared by 26 percent in Lithuania in July versus the year-earlier, the Statistics Department reported on Thursday. Compared with June, the producer prices increased by 1.2 percent last month. Excluding petroleum products, the wholesale prices gained 17.5 percent over the year and rose by 2 percent over a month, the department said. The monthly rise mostly resulted on an 11.6 percent surge in the prices of chemicals, 2.9 percent increase in the prices of electricity, gas, steam and hot water and a 1.7 percent rise in the prices of foodstuffs and drinks.
Lietuvos Zinios

Thursday, 7th of August

Kraft Foods sells its Nordic and Baltic sour snacks business
Global food giant Kraft Foods has signed an agreement to sell its Nordic and Baltic sour snacks business to FEPCO 1 AS, a company controlled by Norway's private investment fund Herkules. Kraft Foods would transfer the sour snack brands Estrella and Maarud in Sweden, Norway, Finland, Denmark, Lithuania, Latvia and Estonia, as well as Taffel chips brand in Denmark, the company said in a statement. The sale also includes the assets and manufacturing facilities in Norway, Sweden and Lithuania. About 360 employees from five manufacturing units of the company would move to work at the buyer's company. Financial terms have not been disclosed. In Lithuania, a potato snacks production line would be sold and some 10 local employees should move to work for Norway's company, Marius Girzadas, project manager at corporate affairs division of Kraft Foods Lietuva, said. The deal needs the approval of respective regulatory authorities, which is expected to be obtained by the end of the year.
Lietuvos Rytas, Verslo Zinios

Eksma reports turnover
Lithuania's Eksma high-tec group reported LTL 22.7 million in turnover in the first half of this year, up 15.6 percent year-on-year. "The demand in complex technological solutions is growing both abroad and domestically. Quality requirements for medical trials have become much more stringent since Lithuania's accession to the European Union, hence we are expanding cooperation with domestic healthcare establishments actively," Rimantas Kraujalis, Eksma Group president, said in a statement. Exports, mostly by laser technology developer and producer Ekspla, comprised approximately 70 percent of interim sales of the group. Eksma Group includes Ekspla, the largest Lithuania's laser producer, Eksmos Medicinines Technikos Centras (Eksma Medical Equipment Center), which implements medical equipment solutions.
Verslo Zinios

Flopo Informacines Sistemos had a good year
The online sales turnover of the company Flopo Informacines Sistemos reached LTL 1.96 million during the first half year, it was by more than two times bigger than during the same period last year. The company’s online sales turnover stood at LTL 943 thousand last year. The company Flopo Inforamcines Sistemos obtained 19 Techmarket chain shops in Lithuania and 8 in Latvia from Euroset LIT this year; it has also merged with the company Fortakas and retook 7 sales and servicing places from it. Flopo Informacines Sistemos started controlling the IT commerce of nine Hyper RIMI shops in Lithuania this year. Flopo Informacines Sistemos owns brands FIS Kompiuteriai, Techmarket and Fortakas. The company will present the joint brand of the group in September.
Respublika

Wednesday, 6th of August

Lithuanian milk producers go on strikes
Lithuanian milk producers on Tuesday staged rallies outside the country's largest dairy companies and are considering more serious protest actions unless the processors increase milk-purchasing prices. "The protest action was successful. Of course, no serious negotiations took place. Therefore, a task group will meet next week to consider what to do next," Bronius Markauskas, the president of the Chamber of Agriculture, said. "The ideas to be considered include suspending milk sales for a week or two, or for a whole month," he said. Tuesday's rallies were peaceful and no incidents were reported, Markauskas said.
Kauno Diena, Respublika, Lietuvos Zinios, Verslo Zinios

Vilnius Furniture reports sales
Vilniaus Baldai (Vilnius Furniture), one of Lithuania's leading furniture manufacturers, reported LTL 76.12 million in sales for the first seven months of 2008, down 12.7 percent versus the year-earlier figure of almost LTL 87.19 million. In July alone the sales of the company shrank by 2.5 percent, year-on-year, to LTL 12.53 million. Earlier the company said its interim losses totaled LTL 3.743 million. For January-June 2007 Vilniaus Baldai posted a profit of LTL 674,000. For 2008 the company projected the sales of LTL 199.5 million and the net profit of LTL 5.8 million.
Verslo Zinios

Lithuanians are open to making risky investments
The Lithuanians are open to making risky investments and often opt to invest on global stock markets, in particular in Eastern Europe, Russia and the Balkan region, the analysts of Hansabankas, one of the largest Lithuania's commercial banks, have observed. "As much as 59 percent of our customers' investments go into the stock funds making investments in the emerging markets. True, this share has declined somewhat this year compared with last year, when it made up 66 percent," Igoris Ryklys, director of investment product department at Hansabankas, said in a statement. Ryklys noted a significant gain in popularity of investments into equity funds of funds. The share of customers' investments into this product has increased to 19 percent of all funds this year, from 7 percent a year ago and 3 percent a couple of years ago.
Verslo Zinios

Tuesday, 5th of August

Ukio Bankas reports net profit
Ukio Bankas, the fast-growing Lithuanian commercial bank, reported LTL 53.7 million in consolidated unaudited net profit for the first half of this year, up 19.6 percent versus the year-earlier figure of LTL 44.9 million. The results of the first half of the year reflect the growth of the banking group. The group raised the assets by 4 percent in the six-month period, to LTL 4.51 billion as of late June. The deposits and L/C portfolio expanded by 7 percent, to LLTL 2.94 billion, while the leasing and loan portfolio of the group grew by 13 percent, to LTL 2.42 billion. The bank alone raised the interim net profit by 1.6 percent, to LTL 50.6 million, while its assets expanded by 5 percent, to LTL 4.22 billion in the reporting period.
Respublika, Verslo Zinios

Siauliu Bank presented figures
The financial group of Siauliu Bankas, the fast growing Lithuania's commercial bank, LTL 10.88 million in profit for the first half of this year, from LTL 16.722 million in January-June 2007. The group's assets expanded by 26.7 percent, year-on-year, to reach LTL 2.147 billion as of late June. The loan portfolio soared by 29.8 percent, to LTL 1.468 billion, while the deposits portfolio increased by 27 percent to LTL 1.358 billion. The Siauliu Bankas group posted LTL 26.461 million in audited net profit for full 2007, down 37.5 percent versus the year-earlier figure of LTL 42.331 million.
Verslo Zinios, Respublika

Lithuanian government sells LTL 90 million worth of six-month Treasury bills
The Lithuanian government sold LTL 90 million worth of six-month Treasury bills at an average yield of 5.14 percent via an auction on Monday. This T-bill issue was launched on May 12 and was last reopened on June 9, when LTL 50 million worth of six-month paper changed hands at an average yield of 5.127 percent. Monday's auction brings the total size of the issue to LTL 220 million. At the auction, the lowest yield bid received was 5 percent and the highest yield accepted was 5.24 percent. Forty-nine bids worth LTL 120.9 million in total were placed for the auction.
Kauno Diena

Monday, 4th of August

Oil production falls in Lithuania
With oil wells in Western Lithuania getting drier, the country's total crude production plunged by 2.1 times, to 36,300 tons in the first half of this year, from 77,600 tons in January-June 2007, the Geological Service reported on Friday. Minijos Nafta, a Lithuanian-Danish joint venture, produced 12,400 tons of oil in January through June this year, down 2.6 times year-on-year. Geonafta's output fell by 2.4 times, to 11,100 tons, while the output by Manifoldas rose by 2,000 tons, to 7,100 tons. The output by Genciu Nafta, a Lithuanian-Swedish joint venture, declined by 2.4 times, to 5,700 tons in the reporting period.
Verslo Zinios

Klaipeda Stevedoring Company posts figures
Klaipedos Juru Kroviniu Kompanija (Klaipeda Stevedoring Company, or Klasco), the largest stevedoring company in the port of Klaipeda, posted LTL 11.5 million in pre-tax profit for the first half of this year, up 2.4 times versus the year-earlier. Revenues on core activities grew by 26 percent, year-on-year, to LTL 76.36 million in January-June, the company said in a statement. The company reloaded almost 5 million tons of cargo in the first half of 2008, up 16 percent year-on-year. Klasco's annual net profit more than trebled last year to LTL 13.514 million up from LTL 4.246 million in 2006. Revenue rose by 22.3 percent to LTL 140.17 million as cargo loadings increased by 14 percent to a record high of 9.6 million tons.
Respublika, Verslo Zinios

FlyLAL will cooperate with Novaturas
Lithuania's flagship carrier FlyLAL-Lithuanian Airlines has signed a strategic cooperation agreement with tour operator Novaturas. Until now Novaturas has cooperated with the charter carrier Aurela, one of the leaders at Vilnius airport. In line with the agreement, FlyLAL-Lithuanian Airlines will render flight services to the customers of Novaturas until 2011. Novaturas will continue cooperating with Aurela by November 2008. "We have a contract until November, and will continue cooperation until that time. We will survive since we have other customers and will look for new ones," Valerijus Vinokuras, Aurela deputy CEO, said.
Verslo Zinios

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