December 21 (SeeNews) - Austria's Raiffeisen Centrobank (RCB) said on Monday it has maintained its 'hold' recommendation on Croatian blue-chip sugar maker Viro and cut its target price.
"We decrease our 12-month price target to 440 kuna [$86.6/60.4 euro] (previously 483 kuna) and stick to “hold” recommendation," RCB said in a statement.
Viro did not manage to achieve the 50%+ share in its Sladorana unit and consolidate it by the end of 2009, contrary to RCB's expectations. Sladorana’s previously announced capital increase of 10 million euro did not take place, nor did Viro take the opportunity to acquire a 4.69% stake from the Croatian Privatisation Fund, RCB said.
It added that it does not expect sugar prices in 2010 to reach the peak levels from 2009.
"To sum up, we have raised our EBITDA [earnings before interestm taxes and depreciation] margin expectations for 2010e-2011e, and especially 2009e, due to improved operational profitability evidenced in the first nine months of 2009. However, due to the EU accession still expected in 2012 our assumptions regarding 2012e and 2013e remain the same."
The company's shares traded on Zagreb Stock Exchange at 380 kuna by 1022 GMT, 2.29% down from its previous close.
(1 euro = 7.2829 Croatian kuna)