News Parkiet

Equity markets

Mid-cap stocks still safer than blue-chips,

analysts say

Mid-sized companies are still a safer bet than large, WIG20 corporations even after yesterday?s 3.7 percent decline of MIDWIG index, equity analysts polled by PARKIET said on Monday. Analysts and stock brokers from twenty Polish brokerage houses and investment funds expect the blue-chip index to fall another 100 points to an average of 1550 points after yesterday?s 48 point (2.8%) decline.

Just one out of 40 MIDWIG stocks managed to stay in black yesterday. However, even after yesterday?s carnage MIDWIG remains 33 percent higher than it was on January 1st. That compares with WIG20?s gain of 5.2 percent.

Public finances

Belka mulling VAT tax changes

New Polish prime minister Marek Belka is considering changes in the country?s VAT taxes, introducing a single, 19 percent value-added tax rate after eliminating exemptions on food and other basic products. Poland now has four official VAT tax rates ranging from 0 to 22 percent. Average VAT now stands at around 15 percent.

Equity markets

FAM Technika Odlewnicza announces

IPO plans

FAM Technika Odlewnicza has announced plans to raise as much as 30 million zloty in a public offering on the Warsaw bourse. The IPO is scheduled for June this year. Toruń-based FAM, which makes doorknobs, window handles and other building accessories said it would use proceeds from the offering for acquisitions and market expansion.

The company has already filed its IPO documents with the Polish Securities and Exchanges Commission.

Founded in 1945, FAM was privatized in mid-1990?s. In 2002 the company was sold to a group of private investors by several private equity funds.

FAM has annual sales of approximately 50 million zloty, with export sales to Germany and elsewhere accounting for almost half the total. Net earnings last year tripled to PLN 2.9 million.

Banking

BRE?s net income rises to PLN 40 million

Commerzbank subsidiary BRE Bank said profit in the first three months rose to the highest level in almost three years after it narrowed losses at its retail banking division. Net income climbed 18 percent to PLN 39.9 million ($9.9 million).

1Money-losing mBank, Poland?s largest Internet bank posted its first ever profit before taxes in the first quarter, while Multibank, BRE?s second retail business reached positive EBITDA thanks to expanding customer base and stronger mortgage lending.

BRE?s retail units generated losses of some 102 million zloty last year. Separately, BRE?s chief executive Wojciech Kostrzewa said the bank may list its leasing subsidiary on the Warsaw bourse sometime next year. BRE Leasing posted Q1 earnings of PLN 3.1 million, more than its total earnings last year.

Pharmaceuticals

Recordati raises stake in Polfa Kutno

Italian drug-maker Recordati has raised its stake in Polish pharmaceutical company Polfa Kutno to about 25 percent after buying about 8.5 percent of the firm on the open market and in after-hours trading. Under Polish stock market regulations Recordati can buy up to 26 percent of Polfa before it has to make an offer to all shareholders.

Manufacturing

Manometry down 46 percent on criminal probe

Shares of Manometry industrial equipment maker plunged 46 percent to close at 80.1 zloty on news that Polish SEC filed criminal charges against investors manipulating the stock. The SEC said it will continue to monitor Manometry after trading in the stock resumed Monday.

Polish SEC, or KPWiG, has asked district attorney in 1Warsaw to investigate recent price movement after thinly traded stock returned a whopping 1440 percent in just a few weeks.

Sources familiar with the situation say a group of retail investors run a ?pump and dump? scheme to drive up Manometry?s stock price.

Telecommunications

SM-Media?s Q1 earnings on target

Warsaw-based voice and data communications provider SM-Media reported first-quarter earnings of 0.2 million zloty representing just over a quarter of this year?s forecast. Revenues for the quarter were up 13.3 percent to PLN 6.9 million, while EBITDA rose 47.5 percent.

SM-Media, which has just completed a 7.5 million zloty IPO and plans to switch from over-the-counter exchange to the Warsaw bourse said June 1st launch of domestic-long-distance (DLD) services will play a key role in this year?s financial forecast.