SSaturday 18th of October, 2003
Cigarette and fuel prices to go up next year
Prices of cigarettes, fuel, dieseline, kerosene as well as the substitutes and supplements of these products will increase next year, following the amendments to the Excise Law registered in the Seimas secretariat.
It is proposed to raise the specific cigarette excise to LTL 47.5 per 1,000 cigarettes next year, while the ad-valor tariff should be raised from 10 percent to 15 percent. The retail price of a 20-cigarette pack would grow by LTL 0.24-LTL 0.35 depending on the brand.
Fuel excise tax should increase from LTL 1,250 to LTL 1,318 per ton. The higher excise tax should increase fuel prices by approximately LTL 0.06.
(Respublika, Lietuvos Rytas)
Little LasVegas in Vilnius
Great Canadian Europa, a Lithuanian-Canadian joint venture, is opening a new casino, Grand Casino World, in Vilnius on Friday with plans to grab a 50 percent market share in the capital city and become the leader of Lithuania's gaming industry.
The new casino and entertainment centre is located in Gedimino Avenue, in central Vilnius.
Speaking in a news conference in Vilnius on Friday, Thomas Bell, development director at the Canadian casino chain Great Canadian Gaming, which owns Great Canadian Europa, said they had plans to expand into other Lithuanian cities and towns, and to start activities in Europe in the future as well.
The Grand Casino World complex also includes a Japanese restaurant, a bar and a nightclub.
(Lietuvos Rytas, Respublika)
Growth of Ukio Bankas
?kio Bankas, the fifth largest Lithuania's commercial bank by assets, reported net earnings of LTL 3.396 million for the first nine months of 2003, an increase of 3 percent versus the January-through-September period of 2002.
Gintaras Ugianskis, ?kio Bankas deputy chairman, said the correct strategy of the bank had a positive influence on the results.
The client base of the bank increased from 28,600 to 37,000 over the year. Assets of the bank soared 56 percent, year-on-year, to LTL 1.09 billion as of the beginning of October. Interest bearing assets surged 2.2-fold, to LTL 777 million.
As of the beginning of October, loan portfolio of the bank totalled LTL 211 million, rising 2.1-fold from the beginning of October 2002.
?kio Bankas expects to post a profit of LTL 4.806 million in 2003. it also plans to float a new LTL 16 million worth issue of shares, raising the equity to LTL 106.7 million by the end of this year.
Friday 17th of October, 2003
Turnover of retailers up 12.2 percent
Turnover of retail companies is up by 12.2 percent to LTL 11.28 billion in the period of January-August compared to the same period last year. The turnover of the large retail companies grew by 16.8 percent, announced Department of Statistics.
The turnover of food-selling retailers is up by 9.2 percent in year-on-year terms, while non-food selling retailers managed to increase their nine-month turnover by 9.1 percent.
The largest increase of turnover 44.6 percent - was registered at the companies selling furniture, lighting equipment, domestic appliances and building materials.
New car sales down by 3.9 pct
New car sales in Lithuania came to 7,322 units over nine months of this year, 3.9 percent lower compared to the figure of the same period of 2002, the market research company Autotyrimai has reported.
Leasing accounted for 57.5 percent (4,207 units) of all new cars acquired in Lithuania in the January-through-September period of 2003.
Sales of new cars in the first nine months of 2002 exceeded the respective figure for the January-to-September of 2003 due to booming sales during the first half of last year, when sales surged on the eve of introduction of amendments to the Law on Value-Added Tax (VAT) that came into effect on Jul. 1, 2002. The amendments revoked refunding of VAT to legal entities on acquisition of new cars.
Peugeot 307 was the best-selling model in Lithuania in September with 63 units sold. Honda Accord ranked second in terms of sales with 27 units, while Skoda Octavia came in the third with 26 cars sold.
Two banks to finance acquisition of the largest alcoholic beverage producer
Vilniaus Bankas and the Vilnius branch of Germany's Vereins-und Westbank will finance the acquisition of Stumbras, Lithuania's leading alcoholic beverage producer.
Mineraliniai Vandenys, a subsidiary of MG Baltic, the multi-business group, is to control Stumbras.
The MG Baltic-controlled alcoholic beverage wholesaler initially bid LTL 152 million for the stake in Stumbras, and pledged to invest another LTL 30 million in the company. The potential investor later improved its financial offer.
According to information that has not been officially confirmed, the bidder increased its investment commitments to around LTL 40 million, but did not change the price offered for the state-owned shares.
(Verslo Zinios, Respublika, Lietuvos Rytas)
Thursday 16th of October, 2003
Successful year for knitwear companies
Utenos Trikotazas, Lithuania's leading knitwear manufacturer, and its subsidiary Satrija reported sales of LTL 99.1 million for the nine months of 2003, a 1.7 percent increase compared to the same period last year. The company's sales are expected to reach LTL 135 million this year.
Satrija is posting very good results from the beginning of the year. This year, the knitwear manufacturer started producing more complicated and original production, provides more expensive services for foreign enterprises.
Turnover of Satrija reached LTL 28 million for the nine months of the year, an increase of 57.3 percent in year-on-year terms.
Alita to stay in the same hands
The Lithuanian State Property Fund (SPF) announced on Wednesday that it will invite a potential investor placed second on the list of bidders for Alita, the country's leading sparkling wine producer, to negotiate a privatization deal.
The SPF did not name the runner-up bidder, but unofficial sources say it is a consortium led by Vytautas Junevicius, the chief executive of Alita.
According to press reports, the consortium bid LTL 57 million for 83.77 percent of shares in Alita. Other members of the consortium include Vilmantas Peciura, CFO of Alita, and Darius Vezelis, the company's marketing director.
Luigiterzo Bosca, the president and owner of the Italian group Bosca, was named the winning bidder for Alita, but he failed to arrive to initial a share purchase agreement last Friday, the date set by the SPF.
Mineraliniai Vandenys, the company to bid LTL 60 million for Alita, announced on Wednesday that it is withdrawing from Alita's privatization process. The company expects to sign a deal to purchase the state's shareholding in Stumbras, Lithuania's biggest distillery, in the near future.
(Verslo Zinios, Respublika, Lietuvos Zinios, Kauno Diena)
Sales of SBA furniture group up by 43.4 pct
A group of six Lithuanian furniture manufacturers, controlled by the business group SBA, reported aggregate sales of LTL 191.632 million for the first nine months of 2003, posting a growth of 33.6 percent compared to the same period in 2002.
Klaipedos Baldai remains the number-one furniture manufacturer, raising its nine-month sales by 43.4 percent, year-on-year, to LTL 75.146 million.
"Sound and timely investments into manufacturing have enabled us to upgrade our product range, as well as to improve our production efficiency and sales," said Ricardas Kiaurakis, CEO of Klaipedos Baldai.
Other SBA-controlled furniture producers posted strong sales growth as well.
Silutes Baldai stepped up sales by 36.9 percent to LTL 54.824 million in the reporting period. Kauno Baldai boosted sales by 18.2 percent to LTL 30.573 million, while Karige recorded a 32.6 percent rise in sales up to LTL 18.433 million.
Exports account for about 90 percent of the SBA furniture group's total revenues. Its major buyers include the Swedish furniture group IKEA and the Belgian retailer Sodim.
Wednesday 15th of October, 2003
Green card a test for the insurers
Starting from today, drivers will be able to buy green insurance cards from the Lithuanian insurance companies. Experts predict that a fierce competition between the companies is very likely and it should result in lower prices. Insurers themselves have doubts over such predictions, as the green card is often a loss-making product.
After Lithuania becomes the member of the European Union in May of 2004, the green card will be needed only for countries outside the union. The current civil liability policies issued by the insurers should be valid in the European Union. Thus, the price for these polices should go up and possibly reach EUR 100.
(Lietuvos Zinios, Verslo Zinios, Kauno Diena, Lietuvos Rytas)
Successful financial injection for small business
Means allotted by the European Bank for Reconstruction and Development (EBRD) for the country's small and medium businesses and distributed by Siauliai bank were used very effectively. The representatives of EBRD gave such an evaluation of the work done by Siauliai bank.
Siauliai bank was the first to receive a credit line from EBRD with a specific goal to support small and medium businesses. Siauliai bank on its behalf grants microloans of up to EUR 30,000 and small loans of up to EUR 125,000 for businesses.
Apart from loans, businessmen could also receive consultations from the bank's experts. According to representatives of the bank, Lithuanian businessmen often lack financial knowledge, thus the consultations were a great help in preparing business plans.
The bank says not a single loan can be classified as a bad one. All businesses used the loan successfully and some of them are already expanding their activities and have taken much bigger loans. The project of EBRD and Siauliai bank is set to continue in future.
Voke III steps into Finland
Voke III, one of the largest manufacturers of kitchen furniture in Lithuania, will open its salesroom in Finland.
The company signed the agreement on kitchen furniture sale with the Finnish company EGF Piping OY in September. The first exposition of the kitchen furniture worth EUR 24,000 will be sent to Finland next week. It will be presented in the company's salesroom in Turku.
Voke III has already opened kitchen furniture salesroom in Reykjavik this year, while its brand store in Odense is already open for over a year. Voke III plans to open two more similar stores in Copenhagen this year.
Tuesday 14th of October, 2003
Amount of foreign direct investments grows
The flow of foreign direct investments in Lithuania was LTL 103.5 million in August, including investments of LTL 89.9 million in corporate stocks by foreign legal entities and natural persons.
Foreign direct investments in Lithuania rose by 6.3 percent to LTL 14.018 billion in the first half of 2003, the Statistics Department has reported. FDI per capita, meanwhile, expanded by 6.6 percent to LTL 4,060 in the reporting period.
The list of top Lithuania's investors shows Danish investors (16.5 percent of the total investments), Swedish (14.9 percent), Estonian (12.5 percent), German (9.5 percent) and US (8.3 percent) investors.
Aibe found partners
Lithuania's retail chain Aibe has joined the Hungarian retail chain CBA, which unites seven Eastern and Central European states.
Egidijus Aleinikovas, director of Aibe Mazmena, says the chain joined the CBA network to cope better with the ever-growing competition in the Lithuanian retail market. Besides, membership in the CBA network should open the doors of the Central European markets.
Meanwhile, representatives of the largest Lithuanian retail chains say the expansion of Aibe will not have a direct impact on their supermarkets. Aibe is a chain that unites small stores of the smaller Lithuanian towns, thus only chains such as Saulute or Norfa could be affected.
Aibe retail chain currently has over 400 stores in Lithuania and almost 300 stores and cafes in Latvia. The chain plans to post a turnover of EUR 190 in Lithuania and Latvia in 2003.
(Verslo Zinios, Lietuvos zinios, Lietuvos rytas)
State investments to increase significantly in 2004
According to the project of the state's investment programme (SIP) for 2004-2006, the state will significantly increase its financial injections into various branches of economy. The state has financial capabilities to allot LTL 600 million more for investments in 2004 than it was able to invest this year. The support for certain economy branches should increase from 4 up to 717 percent. The total amount of state investments into the Lithuanian economy should reach LTL 2.010 billion in 2004. The government has already approved the project.
Among the fields that should feel the increase of the financial support most are information services, development of the tourism facilities, environment protection and society security field. Significant investments are also planned for transport and communications sector, education, police and social security.
Monday 13th of October, 2003
Retail chains have opportunities to expand to neighbouring markets
PricewaterhouseCoopers experts say that national retail chains have good opportunities to grow not only in Lithuania, but in other Central and Eastern European countries as well.
PricewaterhouseCoopers says that retail market is full in countries like Czech Republic and Poland, while in countries like Bulgaria, Lithuania, Romania and Russia it is still growing.
Among the main trends and direction of the retail market development are growing purchasing power and overall living standard of the region. The changing shopping habits and needs, as well as expansion into smaller towns is also observed. Such changes are also stimulating the development of the large leisure centres.
Membership in the EU will raise heating, coffin and biofuel prices
Lithuanian Ministry of Finance presented amendments to the VAT law that comply with the directives of the European Union.
The Ministry of Finance says that the changes will affect only those companies that trade with the European Union. The companies working only inside the country or trading with countries outside the EU will not be affected.
The procedures for companies trading with the EU will become less complicated. The purchase or sale will no longer be considered as export or import. Thus, the companies will not have to pay VAT and spend time returning it from the state.
Starting from next year, the VAT privileges applied for biofuel, heating taxes, international passenger transport services, coffins and mortuary services will be abolished. The reduced VAT tariff of 5 percent will be applied for books, newspapers, magazines, housing services, medicaments, passenger transport services, and fresh iced meat.
(Lietuvos zinios, Respublika, Verslo Zinios)
After the Italian come Mineraliniai Vandenys
Luigi Bosca, president of the Bosca S.p.A group, may withdraw from the privatisation of AB Alita, one of the largest Lithuanian alcohol production companies. He failed to initial the sell-off agreement before the final deadline on Friday.
The public tender commission offered State Property Fund to take a decision on further proceedings in the privatisation of Alita. Antanas Malikenas, head of the Property fund, says the decision will be taken over the next three days.
Meanwhile, public relations company Publicum, which represents Bosca, claims their client informed the Property fund that the buyer will be unable to initial the sell-off agreement on Friday.
Although there is a possibility that the privatisation of the company will be stopped and a new tender will be announced, most probably Mineraliniai Vandenys, the company with the second-best offer, will have a chance to buy Alita.
Baltic Weekly MonitorA