News Parkiet

Equity market

IPO market picks up

Polish Initial Public Offering market is on track to reach a record 9 billion zloty ($2.6 billion) between now and the end of December, prompting fears that IPO activity could suck the air out of the secondary market. In addition to mega-IPO of PKO BP, Poland?s largest retail bank, at least four mid-sized companies plan to raise about a billion zloty in total while two other firms, Citibank Handlowy and ING Bank Śląski plan to offer existing shares worth as much as 1.7 billion zloty. Total IPO estimate of 9 billion zloty accounts for over a third of this year?s Foreign Direct Investments in Poland.

Nineteen Polish companies sold their shares to the public for the first time in the six month to July, raising PLN 1.4 billion.

OFE pension funds are expected to buy a big chunk of the shares offered by PKO BP and other IPO candidates, analysts say.

Public finances

Finance Commission rejects tax code changes

Polish parliament?s Finance Commission said ?no? to most personal income tax changes proposed by various deputies yesterday, rejecting amendments opposed by Marek Belka?s minority government. Most tried to either raise taxes for the rich or increase tax-exempt income for the least affluent taxpayers. One of the few tax breaks that got through is a 760 zloty VAT tax rebate for personal use of the Internet.

Chemicals

BorsodChem plans stock buyback

Hungarian plastics maker BorsodChem Rt., whose shares are listed on the Warsaw bourse, said yesterday it plans to buy back up to two million shares, or 2.63 percent of the total to eliminate excess liquidity. Trading volume in BorsodChem stock in Warsaw rose to the highest level since October 8 dual listing. Analysts say over time Warsaw may become BorsodChem?s main market because of relatively high liquidity compared to other Central European stock markets.

Building materials

TIM to sell real estate

Wrocław-based TIM SA plans to spin off all thirteen properties it now owns to a new, wholly owned real estate unit, publicly traded electrical wholesaler said yesterday. The buildings will then be sold off to raise money for business expansion.

TIM is expected to publish third-quarter earnings today. It said earlier it expects a ten-fold increase in profits to approximately 9 million zloty for all of 2004. Sales are set to raise by a third to PLN 200 million.

Packaging

Świecie?s earnings double on currency gains

Frantschach Świecie, a top pulp and paper manufacturer, reported third-quarter earnings of 84 million zloty, more than twice last year?s figures because of one-time gains due to continuing strength of the Polish currency.

Świecie, which is 71 percent owned by a subsidiary of Anglo-American, reported 6 percent increase in revenues to more than 311 million zloty ($90 million). Shares of the company, which is expected to name a new chief executive today, fell 3.7 percent on the WSE in light trading to close at 64.6 zloty. Analysts say Świecie?s valuation already reflects its 3Q earnings. The stock carries a P/E ratio of 12.67 after yesterday?s drop.

Telecommunications

Netia may pay dividends if acquisition

strategy fails, CEO saysNetia SA, Poland?s second largest phone company could pay out its first ever dividends next year unless if none of several acquisitions planned by the firm works out, chief executive Wojciech Mądalski said in an interview yesterday. It has more than one billion zloty ($290 million) for takeovers of smaller local rivals, but so far Netia?s attempts to buy third largest market player, Wrocław-based Telefonia Dialog, were rebuffed by Dialog?s main shareholder, KGHM copper mine. Other potential acquisition targets include Energis, a data carrier that was originally controlled by UK?s National Grid, state-owned Telbank and Tel-Energo data firms and GTS, a smaller Warsaw telco that is part of Russia?s Amtel Holdings group. Mądalski reiterated his expectation of sales outlook for the company. Netia said earlier it expects 2004 revenues to reach 900 million zloty, up 28 percent from last year. EBITDA margins are expected to increase to around 35 percent.