News Parkiet

Petrochemicals

Former Orlen CEO to receive PLN 6 million under severance agreement

Ex-CEO of PKN Orlen refinery Zbigniew Wróbel will receive about six million zloty in compensation under a separation agreement with Poland?s largest company. Wróbel, who left PKN Orlen earlier last month over questionable contracts, will receive compensation equal to twelve-month salary, plus an additional payment because of non-compete agreement he signed in 2002.

Zbigniew Wróbel received approximately 200.000 zloty a month plus quarterly bonuses during his two-year stint at PKN Orlen.

Sources close to the situation say Wróbel?s management contract was rushed through the board of directors at unprecedented speed. One senior executive at the state-controlled oil company says others had to wait three months for their contracts.

Equity markets

Suspect held over derivatives?

manipulation scam

Warsaw District Attorney has resumed an investigation into alleged manipulation scam to prop up the price of Budimex stock warrants, after police found one of two suspects involved in the case. Thinly traded derivatives rose almost 30 percent in January 2002. The suspect, who was not identified publicly, hasn?t been arrested yet, but remains under continuing police surveillance.

Civil engineering

PBG cut to ?reduce? by BDM PKO BP

Analyst Bartłomiej Michalski of BDM PKO BP gave ?reduce? rating on PBG, a mid-sized pipeline construction company. The target price was set at 33.3 zloty. The stock closed at 36.7 zloty yesterday.

Michalski believes that PBG, which completed its 96-million zloty IPO in June is overvalued compared with other building and civil engineering companies listed on the WSE. Based on discounted cash-flow method, the stock is worth 34.8 zloty, Michalski wrote in a research report first published on August 6.

Chemicals

Dwory to file for IPO soon, sources say

Firma Chemiczna Dwory, an 840-million zloty rubber-maker from southern Poland, may file for IPO as early as next month, sources close to the situation told PARKIET on Friday. Dwory?s main shareholder, NFI Foksal privatization fund, has decided to exit its eight-year investment by listing the company on the Warsaw Stock Exchange. NFI Foksal has approximately 45 percent of Dwory. The stake is valued at 92 million zloty. Foksal itself is worth PLN 161 million.

The fund has already hired Bank Zachodni WBK and its brokerage house, DM BZ WBK to handle the IPO.

Privatization

Poland to sell Elektrownia Kozienice on the WSE

Polish government has announced plans to sell Elektrownia Kozienice power plant in a privatization IPO on the Warsaw Stock Exchange this week. The country?s Treasury Ministry has already tried to sell Kozienice in February 2003 to a consortium of Electrabel?s Połaniec power plant and the International Power Global Developments, an investment group. However, it then rejected Electrabel?s bid of 100 million zloty ($27 million) for the plant.

Elektrownia Kozienice generates about 12 percent of Poland?s electricity from two 500 Megawatt power blocks. State-owned company reported profits of 53 million zloty last year.

Agricultural machinery

Hydrotor counting on profits

from Polish farmers

Publicly traded Hydrotor S.A., a small manufacturing company that makes components for construction equipment and farm machinery, reported 32 percent increase in sales in the second quarter of this year. Its revenue totaled 15.3 million zloty, with agriculture accounting for over half of its sales. Second-quarter earnings more than tripled to PLN 1.3 million.

Shares of Hydrotor, which has a market cap of 48 million zloty, rose 3.8 percent to a six-year high of 19.25 zloty at the close on Friday.

Power industry

ZREW hits new high after 2Q earnings

Shares of ZREW S.A., a Warsaw company that upgrades power plants and utilities, rose 14.1 percent to 79.3 zloty on Friday after it published record second-quarter earnings. ZREW, whose full name is Zakłady Remontowe Energetyki Warszawa, reported profits of some 3.94 million zloty, a three-fold increase from the same period a year ago. Sales doubled to PLN 79 million, thanks in part to last year?s acquisition of Naftoremont, a Płock-based maintenance company that services PKN Orlen oil refinery.

Chief executive Paweł Rychter boasts that his company is now working on ?dozens? of contracts worth several million zloty each. Mr. Rychter expects much stronger 3Q earnings, traditionally the best period for ZREW.