1A. Bucharest Stock exchange Indicators
Bucharest Stock exchange Indicators (table)
BET and Turnover (YOY) (chart)
BET-C, BET-FI and ROTX (YOY) (chart)
1B. market Comment
During this week, BSE indices posted three consecutive trading sessions with declines over 1.3% (Tuesday, Wednesday and Thursday), while on Friday, BET and BET-C recorded small increases of c0.35% each, while BET-FI rose 1,22%. On Thursday, BET-FI reach a level never seen since June 2006. The week was dominated by the H108 financial results announcements of the company. We may divide the companies based on the evolution of H108 results as compared to H107 in the following group: those whose yearly increase of net profit was a surprise (e.g.: Rompetrol rafinare, Transelectrica); those whose H108 results were almost flat compared to H107 (e.g.: Transgaz, Biofarm); those whose results were lower than H107 (e.g.: Antibiotice, broker Cluj). As regards the five SIFs, SIF Transilvania reported a decline of 17.75%YOY of its net profit, while SIF Oltenia posted a decline of 31.92%YOY. The other three financial investment companies recorded increases of net profit, the highest growth being recorded by SIF Muntenia, namely 66%YOY.
1C. ‘Watch List’ Evolution
Watch List’ Evolution (table)
BET-C and Turnover (chart)
Winners/Losers (%) (chart)
Most Traded (%) (chart)
market Trends. BSE indices posted the biggest weekly losses of the last month. BET recorded the highest weekly decline, namely 6.72%, followed by BET-C with a loss of 6.16% and by BET-FI which decreased by 4.34% as compared to last Friday trading session.
Liquidity. The weekly transaction value went up 14.9% as compared to last week, reaching RON 119.56 Mn (EUR 33.68 Mn). On the Regular market, the most traded issuers of the week were SIF Transilvania (SIF3) worth RON 18.02 Mn, Azomures Tg Mures (AZO) worth RON 11.6 Mn, Banca Transilvania (TLV) worth RON 10.04 Mn, BRD-GSG (BRD) worth RON 9.51 Mn.
2. Rasdaq market Indicators
RAQ-C and Turnover (YOY) (chart)
Most Traded (%) (chart)
RAQ–I depreciated by 5.40% for the week, up to 3,848.95, after on Tuesday and Thursday it lost 4% each day, on the back of a very modest evolution of the shares listed at the first tier. Unlike RAQ–I, RAQ–II, which shows the evolution of the shares listed at the second tier, posted a slight gain of 1.53% as compared to previous Friday, up to 6,976.47 while RAQ–C lost 1.90% for the week, closing at 4,091.22.
The weekly turnover went half compared to the previous week, reaching RON 17.79 Mn (EUR 5.01 Mn), after the cumulated daily value of the transactions run on Thursday and Friday did not exceed RON 3.5 Mn (EUR 1.2 Mn). Actually, on Thursday it has been recorded the lowest daily transaction value since April, 17 2008.
The most important trade run for the week was made on Thursday with the shares of Unirea Shopping Center SA Bucuresti (SCDM), the shares posting a gain of 24%. Following the eight trades run, 60,490 shares have been traded representing only 2% of the company’s share capital, but 73.26% of the daily liquidity of RON 10.31 Mn (EUR 2.91 Mn).
3. Foreign investments
TOP INVESTORS BY NET PURCHASES (table)
FOREIGN PORTFOLIO investments (table)
Foreign investments (YOY) (chart)
In June 2008, the net outflows of the foreigners accounted for RON 17.81 Mn (EUR 4.87 Mn). In June 2008, inflows of foreign investments accounted for RON 101.16 Mn (EUR 27.67 Mn) and outflows accounted for RON 118.97 Mn (EUR 32.54 Mn), according to the National Securities Commission. The non-residents purchased securities worth RON 177.16 Mn (EUR 48.46 Mn) and sold securities worth RON 196.35 Mn (EUR 53.71 Mn). (Source: NSC)
4. Macroeconomics
MACROECONOMIC INDICATORS (table)
Macroeconomic Indicators (chart)
In July, the annualized rate of inflation reached 9%. In July, the consumer price index went up by 9% YOY, posting a monthly increase of 0.7%. The food prices decreased by 0.7% compared to the previous month, the non-food prices climbed by 2.3%, while the tariffs of the services declined by 0.3% as compared to June. (Source: INSSE)
In H108, the trade deficit (FOB-CIF) increased by EUR 1.09 Bn (YOY) to EUR 10.79 Bn. In the first six months of 2008, exports (FOB) worth RON 61.38 Bn (EUR 16.75 Bn), while imports (CIF) worth RON 100.92 Bn (EUR 27.54 Bn), thus the trade deficit (FOB-CIF) was RON 39.54 Bn (EUR 10.79 Bn), up RON 7.18 Bn (EUR 1.09 Bn) as compared to the first six months of 2007. In June 2008, exports (FOB) were worth RON 11.08 Bn (EUR 3.04 Bn), up 36.6% YOY in RON terms (21.2%YOY in EUR terms), while imports (CIF) were worth RON 18.37 Bn (EUR 5.03 Bn) up 32% YOY in RON terms (17.1%YOY in EUR terms), thus the trade deficit (FOBCIF) was RON 7.29 Bn (EUR 1.99 Bn) in June 2008. (Source: INSSE)
In the first six months of the year, the current account deficit reached EUR 7.98 Bn. In the first six months of the year, the current account deficit accounted for EUR 7.98 Bn, up 8.48% YOY mainly due to a wider trade deficit that accounted for EUR 8.67 Bn, up 10.3% YOY. The current account deficit was 61% covered by foreign direct investments that were worth EUR 4.84 Bn, up 63.40% YOY. (Source: BNR)
5. FX - Money market
FOREIGN CURRENCY market (table)
INTERBANK INTEREST RATES (table)
RON/EUR and EUR/USD exchange rates (YOY) (chart)
FIXED INCOME INSTRUMENTS (table)
Comment. On Monday, RON depreciated by 1.83% against EUR on the back of the investors’ risk aversion for the emerging markets’ currencies, mainly, due to the military conflict in the region. Starting with Tuesday, RON slightly strength against EUR, but on Friday closed weaker at 3.5483 RON/EUR. During the week, the exchange rate RON/USD posted a significant volatility, closing on Friday at 2.4100 RON/USD from 2.3696 RON/USD on Monday. As compared to last Friday, RON depreciated by 4.08%, as USD strength against EUR on the international markets. On August 12, ROBID/ROBOR ON reached the highest level since the beginning of the year, following the low liquidity on the market.
6. International Markets
STOCK EXCHANGE: ATG (Athens); BUX (Budapest); PX50 (Prague); Dow Jones (New York); FTSE100 (London); DAX-30 (Frankfurt); CAC-40 (Paris); STOXX 50(Europe) (table)
BET, ATG, PX50, BUX (YOY) (chart)
Comment. Most of the major capital markets indices posted small weekly losses, although they started the week on green and finished it with some gains. The main negative drivers for all the markets were: bad news coming from financial sector (e.g.: JP Morgan Chase reported USD 1.5 Bn write-off, Wachovia reported a higher Q2 loss than expected, UBS reported that people withdrew money from the bank in Q2 more than in Q1), the data reported on Thursday regarding euro-zone showed the contraction experienced by those economies in Q2, US retail sales dropped less than expected in July by 0.1%, CPI in US jumped 0.8% last month. Among the positive drivers of the markets we may mention: the decline of crude oil price futures for September, the strength of USD that helped European exporters (e.g.: BMW, Porsche).
7A. news for Companies Listed on the Bucharest Stock exchange
- SIF TRANSILVANIA Brasov - SIF3: H108 net profit of SIF Transilvania down 17.75% YOY. In H108 SIF Transilvania reported a net profit of RON 75.36 Mn, down 17.75%YOY. However, SIF Transilvania exceeded its net profit budgeted for the entire 2008 worth RON 53 Mn. The operating revenues dropped 23%YOY, on the back of an increase of 15.95%YOY of the dividends cashed in and of a decrease of 36.77%YOY of the revenues obtained thorough selling financial assets. The operating expense declined 33.33%YOY. (Source: SIF Transilvania)
- IMPACT Bucuresti - IMP: Impact Bucuresti continues its share buyback. Starting with July 28, 2008, Impact Bucuresti started the share buyback process, which was decided during the April 19, 2008 SGA, and through this program there will be repurchased a maximum of 80 Mn shares, representing 4% of the company s share capital, at a price between RON 0.1 and 0.5 per share, and a part of the shares will be given to the employees and administrators. During 4 – August 8, Impact bought back 2.6 Mn shares, amounted to RON 0.52 Mn. (Source: Impact)
- ROMPETROL WELL SERVICES Ploiesti - PTR: H108 net profit of Rompetrol Well Services rose 44.12%YOY. Rompetrol Well Services, provider of special well services, posted a net profit of RON 12.92 Mn in H108, up 44.12%YOY, and a turnover of RON 47.29 Mn, up 18.32%YOY. Q208 net profit of the company increased by 16.98%QoQ, while its turnover went up 16.52%QoQ. The company exceeded its H108 budgeted net profit by 50.35%. Future good financial results might be expected provided that good prices for hydro-carbons are maintained leading to an increase of investments in E&P sector that will have a positive impact on the demand of special well services. (Source: Rompetrol Well Services)
- CONDMAG Brasov - COMI: Condmag net profit rose 3.36 times in H108. Condmag, oil and gas pipeline constructor, posted for H108 a net profit of RON 9.46 Mn, increasing by 236.6% YOY, from RON 1.92 Mn in H107, and a total turnover that rose 22.6% YOY, on the back of total revenues of RON 76.06 Mn, which increased by 46.53%. (Source: Condmag)
- ANTIBIOTICE Iasi - ATB: H108 net profit went down 19.66%YOY. Antibiotice Iasi, pharmaceutical producer, posted an increase of 5.27%YOY in H108, up to RON 107.32 Mn, on the back of 72% YOY (in USD terms) rise of the company s exports. H108 net profit amounted to RON 16.65 Mn, down 19.66% YOY. management guided for FY08 net profit of RON 36.168 Mn (11.43% YOY) implying a P/E(08E) of 16.48x. (Source: Antibiotice)
- TRANSELECTRICA Bucuresti - TEL: Net profit turned double in H108 to RON 115.56 Mn. Transelectrica Bucuresti, power grid operator, posted for H108 a net profit double YOY to RON 115.56 Mn, while the operating profit reached RON 148.27 Mn (+73.34% YOY). The result exceeded management expectations of RON 90 Mn for the FY08 gross profit, while total revenues accounted for approximately 50% of the management guidance. The implied P/E(08E) accounts for 19.54x. (Source: Transelectrica Bucuresti)
- ROMPETROL RAFINARE Constanta - RRC: Net turnover up 90% YOY. Rompetrol Rafinare Constanta posted for H108 a net turnover of USD 2.06 Bn, up 90 %, with EBITDA down 3% YOY to USD 83.03 Mn. On the refining segment, the H108 net profit declined by 77% to USD 6.12 Mn, although the net turnover doubled YOY to USD 1.86 Bn. The total feedstock processed went up 29%YOY to 2.3 Mn tons as for FY08 total feedstock is forecasted to 4.1 Mn tons. The gross refining margins declined by 6%YOY on the back of the crude oil price increase, while in return the net refining margin recorded an increase of approximately 6% following higher sales of petroleum products and further optimization of the activity in terms of processing costs and technological consumption. Both the distribution and the petrochemical segments posted higher turnovers due to activity development but recorded losses that translated into an overall negative consolidated result of USD 48.96. The above mentioned financial results are consolidated unaudited according to IFRS. (Source: Rompetrol Rafinare Constanta)
- ELECTROAPARATAJ Bucuresti - ELJ: Electroaparataj posted losses of RON 7.1 Mn in H108. In H108, Electroaparataj, electrical equipment producer, reported losses of RON 7.1 Mn (EUR 1.9 Mn) 4.3 times higher from RON 1.6 Mn in H107, due to 8.2% higher expenses and 2.6% lower revenues, while its turnover increased by 7% YOY, from RON 43.8 Mn to RON 46.9 Mn. management guided for FY08 a turnover of RON 88.25 Mn (+9.7% YOY) and a net profit of RON 1.81 Mn compared to the loss of RON 10.4 Mn reported for FY07. (Source: Mediafax)
- COMPA Sibiu - CMP: Compa Sibiu turnover increased by 11.5% YOY. In H108, Compa Sibiu manufacturer of auto parts, posted a turnover of RON 171 Mn, up 11.5% from RON 153 Mn in H107. The net profit dropped by 40% YTD, to RON 4.33 Mn, while the total revenues increased by 11.2%, and the total expenses went up 12.9%. management guided for FY08 total revenues growth of 23.59% to RON 400 Mn and net profits of RON 105 Mn (+38.68% YOY) implying a P/E(08E) of 1.83x. For FY07 the company did not pay any dividends. (Source: Mediafax)
- FLAMINGO INTERNATIONAL Bucuresti - FLA: Flamingo posted losses, in spite of the fact that the total turnover increased by 54% in H108. In H108, Flamingo International, IT&C retailer, posted a 54% higher turnover, namely RON 342.43 Mn (EUR 95 Mn), but posted losses of RON 6.39 Mn, 60% lower as compared to H107, as a result of improved sales processes. The wholesale performance overcame both the budgeted numbers and 2007 performances by 74%, respectively by 75%. (Source: Flamingo)
- SIF MUNTENIA Bucuresti, SIF BANAT CRISANA Arad, SIF Moldova Bacau – SIF4, SIF1, SIF2: The three financial investments companies posted H1 financial results. SIF Muntenia Bucuresti reported for H108 a net profit of RON 63.36 Mn, up by 66%YOY. Total revenues increased by 65.42%YOY to RON 101.47 while total expenses went up by 48%YOY to RON 31.84 Mn. On the other side, SIF Banat Crisana Arad posted a net profit of RON 54.37 Mn, down by 15.25% YOY, while SIF Moldova posted an increase of 51.45%YOY up to RON 70.59 Mn.(Source: see news)
- BIOFARM Bucuresti - BIO: Biofarm posts H108 net profit increase of 1.66% YOY. Biofarm Bucuresti, pharmaceutical producer posted for H108 a net profit of RON 9.3 Mn, almost flat vs.H107 net profit of RON 9.16 Mn, while H108 turnover reach RON 31.32 Mn, up 6% YOY. H108 net margin accounted for 29.7% while the EBITDA margin accounted for 39%. According to the Cegedim report regarding the evolution of the pharmaceutical market in H108, Biofarm outperformed the pharmaceutical market (pharmaceutical companies that produce and sell within the country) in terms of units sales by 17.18%YOY while in monetary terms the outperformance was around 23.13%YOY. The H108 net profit accounts for 64.2% of the FY08 net profit guidance while the turnover represents approximately 44.84% of the estimates. The implied P/E(08E) stands for 20.23x. (Source: Biofarm)
- TRANSGAZ Medias - TGN: Net profit up 3.4% in H108 to RON 153.7 Mn. Transgaz Medias, gas pipeline operator, posted for H108 a net profit of RON 153.7 Mn (+3.4%YOY), while the total turnover reached RON 543 Mn (+11.49% YOY). The result exceeded management expectations by 9.95% for the H108 net profit, while total revenues accounted for approximately 96.51% of the management guidance. The YOY increase in company s revenues is explained by a higher quantity of natural gas transported and higher tariffs for the services provided as compared to ayear ago period. (Source: Transgaz Medias)
- OIL TERMINAL Constanta - OIL: Afaceri in crestere cu 18% YOY pana la 64,8 Mil RON (17,7 Mil EUR). In H108, Oil Terminal Constanta reported a turnover of RON 64.8 Mn (EUR 17.7 Mn), up 18.1% YOY, while the company s profit climbed by 7.3% to RON 1.3 Mn (RON 0.36 Mn). In Q208, the sales of the port operator increased by 24.6% to RON 31.9 Mn (EUR 8.7 Mn) on the back of a profit up 35.8% YOY. According to the company s management, the results were influenced by the halt occured in the activity of Rafo Onesti while the budget could not be meet due to lower quantities handled and consequently they have decided to monitor and reduce all type of expenses. (Source: Oil Terminal)
- TERAPLAST Bistrita - TRP: Teraplast posts H108 net profit almost flat as compared to H107. Teraplast Bistrita, construction materials producer, posted for H108 a net profit of RON 9.08 Mn, 0.6% higher vs.H107 net profit of RON 9.03 Mn, while H108 net turnover reach RON 92.20 Mn, up 11.99% YOY, according to RAS unconsolidated financial statements of the company. H108 company s turnover represented 90.29% of the H108 forecasted turnover, while H108 net profit is slightly larger (1.96%) than H108 forecasted net profit. (Source: Teraplast)
- SSIF broker Cluj-Napoca - BRK: H108 net profit is 7.7 times lower than H107. SSIF broker, brokerage company, posted for H108 a net profit of RON 2.26 Mn, 7.7 lower than H107 net profit (RON 20.52 Mn), while the turnover posted a decrease of 36.18%YOY up to RON 6.05 Mn, due to the 64%YOY decline in operating revenues. The H108 gross profit accounts for only 11.22% of the FY08 gross profit guidance while the turnover represents approximately 12.22% of the estimated ones. (Source: SSIF broker)
7B. news for Companies Listed on Rasdaq market
- ATLAS GIP Ploiesti - ATGJ: Atlas Gip posted a 3.2 times higher net profit in H108. In H108, Atlas Gip Ploiesti, oil and gas drilling services supplier, posted a net profit of RON 17.89 Mn (EUR 4.9 Mn), 3.2 times higher as compared to the H107 gains of RON 5.5 Mn, while the revenues rose 28.3% YOY and the turnover increased by 13.6% YOY. (Source: Mediafax)
7C. news on Economy and privatization
- The Ministry of Economy and Finance sold 6-M T-Notes worth RON 69.25 Mn. On 13 August 2008, the Ministry of Economy and Finance sold 6-M T-Notes worth RON 69.25 Mn, at an average yield of 11.94%, up from 10.92% in the previous auction. The scheduled value of the auction accounted for RON 400 Mn, while the demand of the banks accounted for RON 605.93 Mn. (Source: see news)
8. company Announcements
FINANCIAL CALENDAR FOR THE FORTHCOMING WEEK
For the next week (18 – 22 August 2008) there are no events announced for the ‘Watchlist’ companies
CORPORATE ACTIONS
For the next week (18 – 22 August 2008) there are no corporate actions announced for the ‘Watchlist’ companies
9. Trading Data for BSE Issuers (table)
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