News Parkiet

Construction

Mostostal may lose key assets

to debtors and creditors

Mostostal Zabrze, a civil engineering company from Silesia may be forced to give up its few remaining assets to selected creditors after it failed to secure court protection from former business partners. In early May Mostostal presented new debt reduction proposals, including debt for stock swap, that leave the company exposed to uncontrolled repossessions by creditors on a 'first come, first serve' basis. At least one creditor, Cresco Financial Advisors investment firm complains the arrangement favors some creditors at the expense of others.

At the end of March Mostostal's assets have declined to about 240 million zloty, or 100 million zloty less than its total debt.

Banking

Citi and ING must sell part of their stakes

in Polish banks, regulator says

Citibank and ING Groep must sell part of their stakes in two Polish subsidiaries, Citibank Handlowy and ING Bank Śląski, GNIB banking authority said yesterday. Citigroup, which has an 89.3 percent stake in the publicly traded Handlowy, Poland's top corporate bank promised earlier it would reduce its stake to less than 75 percent by the end of last year, but received a year-long extension.

ING Groep, which owns 88 percent of ING Bank Śląski made a similar pledge when it first took over the Polish bank two years ago.

Banking analysts say Citibank and ING are unlikely to sell their excess shares on the open market. Instead, they expect the two banks to sell part of their stakes to other institutional investors.

Mining

KGHM plans record earnings

KGHM Polish Copper, one of Europe's largest copper and silver producers has announced it would increase its earnings forecast for 2004 to as much as 1.23 billion zloty ($330 million), almost double the previous PLN 652 million because of higher commodity prices. Sales are set to rise from 5.17 do 5.76 billion, KGHM said in a statement for the Warsaw Stock Exchange. CAPEX spending will stay the same, at PLN 590 million. KGHM, a widely held stock that is part of WIG20 blue chip index posted Q1 earnings of some 460 million zloty

KGHM's board of directors is expected to approve new financial target at its next meeting on June 30.

KGHM's board also gave preliminary 'go ahead' for company's plans to list its holiday resort operator Interferie on the Warsaw Stock Exchange.

Shares of KGHM rose 1.9 percent to PLN 27.5 on the news.

Based on yesterday's closing price and prospects for record annual earnings, KGHM's P/E would drop to 4.47 at the end of December 2004 from 5.09 yesterday. The forecast does not include earnings of KGHM's non-core telecom assets. KGHM has 200 million shares outstanding, half of which are still controlled by the Polish government.

Separately, KGHM signed a new contract to deliver 800 million dollars worth of copper to China Minmetals Nonferrous Metals over the next five years starting in 2005.

Pharmaceuticals

Hurtap IPO postponed until 2005

Regional drug distributor Hurtap SA has postponed planned Initial Public Offering on the Warsaw bourse until sometime in 2005 because it found the money it needs for expansion. Hurtap, which has a 4.5 percent market share said it has received about 2 million zloty from EU structural funds. The money is already earmarked for new logistical equipment.

Founded in 1990, Hurtap has about 300 shareholders, mainly drug store owners from central Poland. Its annual sales total approximately 500 million zloty, with 1 percent net margins.

Building materials

Ceramika provides IPO details

Ceramika Nowa Gala ceramic tile-maker has announced detailed plans of its 35-million zloty IPO on the Warsaw Stock Exchange, due to start by mid-June. Ceramika, which is controlled by NFI Jupiter investment fund said it would offer up to 7 million new shares priced at between 4 and 5 zloty each, raising funds for its second production plant in Starachowice in south-central Poland. Existing shareholders, including Ceramika's CEO Waldemar Piotrowski won't be selling their stock in an IPO.

Ceramika, which makes high-end porcelain stoneware, posted sales of approximately 65 million zloty last year.