News flow

18.05.12
Summa Holding May Buy Out 56% of FESCO for $1bn
(BUY, TP: $0.52, CP: $0.32) Today (18 May) Kommersant reported that according to its sources, Summa Holding is in talks with Sergei General, controlling shareholder of FESCO, to buy out his 56% stake in the latter for $1bn (total implied market cap is $1,786mn). FESCO’s current market capitalisation is $940mn, implying 90% upside. However given that FESCO’s shareholding scheme is quite complicated, a minority buyout is not guaranteed. It is also interesting to note that according to the article, FESCO’s sale of Transgarant has been put on hold. Bottom line While the information was not officially announced, we regard it...
17.05.12
RusPetro Announces Interim Management Statement – Marginally Positive
RPO; Not Rated; CP: GBp167/share RusPetro published its interim management statement today (17 May). The company reported only revenue, capex and its cash position for 1Q12 which presented no surprises. Revenue increased to $19.2mn or by 28% QoQ and more than five times YoY; capital expenditures amounted to $20mn and the cash balance was $155mn at end 1Q12 (the company raised $250mn at its IPO in January). RusPetro’s production rate YtD has reached 4,000 bpd (vs its 2,475 bpd average for 2011) and management confirmed that it is on track to achieve 10,400 bpd by YE12. Its drilling programme is...
16.05.12
Mosenergosbyt Announces Dividends; 24% Yield at Yesterday's Close
Mosenergosbyt held its board meeting yesterday (15 May) and announced that its AGM will take place on 20 June 2012. We note the following interesting decisions which are most likely to be accepted at the AGM. An FY11 dividend of 0.1341 RUB/share, which gives a pay-out ratio of 86% vs 74% in 2010. We had expected a modest pay-out ratio of 34% for FY11. The registry closed yesterday (15 May). We note that the company paid RUB0.1021/share in 2010. Mosenergosbyt might pay one of the subsidiary companies of Inter RAO over RUB2bn for services that we regard as questionable. Bottom...
16.05.12
Tethys Petroleum Reports 1Q12 Financials and Kazakhstan Resource Upgrade - Positive
TPL; Not Rated; CP: GBp47/share Tethys Petroleum published its 1Q12 financial results and resource update today (16 May). Revenue increased by 45% YoY to $6.5mn driven by higher prices and production growth (+13% YoY). Despite this, the company remained unprofitable due to high administrative expenses. EBITDA improved to negative $2mn vs negative $3.7mn in 1Q11, while the net loss increased to $6.7mn or by 5% YoY. Overall the results are marginally positive, in our view. Tethys has also announced significant growth in its prospective resources in Kazakhstan. Unrisked oil resources of 1.17bn bbls were included in the resource report for...
16.05.12
Dragon Oil Announces Operational Update - Neutral
BUY; TP:GBp817/share; CP:GBp522/share Dragon Oil has published its operational update today (16 May). The company completed drilling and testing of its sixth well this year with initial production rate of 1,775 bpd. DGO also disclosed that some older wells were out of production in April-May due to presence of sand. The company is installing sand screens and desanders on certain wells and platforms to prevent oil production damage. The company reiterates its 15% production growth target for FY12 and promises to deliver 10-15% YoY growth in 1H12. Bottom line We treat current operational statement of Dragon Oil as neutral for...
15.05.12
Ros Agro Releases April Trading Update – NEUTRAL
AGRO (Not Rated, CP $7.0) Ros Agro released its April trading update today (15 May). The sugar division was idle, with no activity at the company’s production facilities, while the meat division demonstrated strong 18% YoY growth in production volumes to 5,200 tonnes. The company posted a 28% YoY decline in margarine production (with April volumes dipping to 1,900 tonnes) and slight, 5% YoY growth in the mayonnaise segment (to 4,900 tonnes). The agricultural division continues to prepare for the 2012 harvesting season. Bottom line The results are weak but predominantly based on seasonal factor and are therefore likely to...
15.05.12
Facebook Raises its IPO Price Range – Positive Read-Across for Russian Internet Companies
Facebook has increased the share price range for its IPO to $34-38 from $28-35, Interfax reports today (15 May). As such, if the IPO is priced at the middle of the range, at $36/per share , this puts Facebook’s MktCap at $100bn. The company is to close the book this week. The news creates a positive outlook for internet companies, in our view, including Mail.RU, which holds a 2.4% stake in Facebook, and for other Russian internet companies, including Yandex and RBC....
15.05.12
RBC 1Q12: Strong Internet and TV Sales Growth, Seasonally Weak Profitability
RBC reported a set of selective financials for 1Q12 today (15 May). Traditionally high seasonality in 1Q. RBC’s sales were up 18% YoY (in rouble terms) to RUB1,007mn, while EBITDA was - RUB118mn largely due to the highly seasonal nature of RBC’s business. RBC operates in the cyclical media business, compounded by the fact that its core clients are also cyclical. The latter means that RBC’s financials are significantly hinged on seasonal factors, with the first quarter typically the weakest. Surprising outpacing of the internet display market in 1Q12. RBC’s internet advertising sales (mostly display advertising) rose 26% YoY in...
15.05.12
JKX Oil & Gas Releases Interim Management Statement - Neutral
JKX; Not Rated; CP:GBp113.25/share JKX Oil & Gas has announced its interim management statement today (15 May). There are three main news items of importance, in our view: 1Q12 results. The company disclosed only production volumes and realised prices for the period. Production was down by 18% YoY, but prices increased (+50% YoY for gas and +8% YoY for oil). Our estimate of 1Q12 revenues (excluding LPG) amounts to $53.6mn (+11% YoY), though the company did not provide either LPG sales volumes or total revenues. We believe this leaves a rather negative impression overall. Start of sales in Russia. JKX...
15.05.12
RZD's Position: Delay TransContainer's Privatisation
TRCN (HOLD, TP: $11.00, CP: $10.50) Today (15 May) RZD held a meeting with analysts and investors in Moscow. RZD’s management was represented by Vadim Mikhailov, senior vice-president for finance, and Pavel Ilyichev, deputy head of the corporate finance department. Ilyichev is also chairman of the TransContainer board. Among other things discussed during the meeting were the timing and terms of TransContainer’s privatisation. According to the speakers, RZD’s current stance is that TransContainer’s privatisation should be delayed for several years. Three main points were given in favour of the postponement: Recent improvements in TransContainer’s financial performance have not been priced...
15.05.12
KMG EP Reports 1Q12 IFRS Results - Positive
KMG EP has released its 1Q12 financial results today (15 May). Revenue amounted to KZT207mn (+8% YoY) exceeding our and consensus estimates by 4.8% and 4.4%, respectively. Earnings demonstrated strong performance: EBITDA of KZT81bnwas 27% higher YoY and 36% higher vs our estimate; net income reached KZT75bn (+27% YoY) which is more than 20% ahead of our and consensus forecast. The company showed good cost management by stabilising its production expenses (+4% YoY) and decreasing SG&A expenses (-21% YoY). Bottom line The results look positive for the company’s stock, in our view...
15.05.12
Dixy Releases FY11 Financial Results - Positive
Dixy (SELL, TP $7.9, CP $10.3) Dixy released strong FY11 financial numbers this morning (15 May). With the exception of net income, which was in line with market estimates, all figures were above consensus forecasts. Consensus figures are given on a pro-forma rather than on a consolidated basis, which explains why our first take on the numbers was incorrect. Pro-forma revenue reached RUB122bn, almost doubling vs 2010’s level thanks to the Victoria acquisition. Gross profit advanced to RUB34bn with gross margin soaring to 27.1% in 2011 vs 24.1% last year thanks to economies of scale and better purchasing terms. EBITDA...
15.05.12
VimpelCom 1Q12: Moderately Positive
VimpelCom Ltd has released its 1Q12 US GAAP numbers today (15 May): revenue was in line with Interfax consensus; EBITDA was 1.3% above consensus, net income exceeded the market’s expectations by 8.5%. Competition in Russia could decrease. VimpelCom’s Russian mobile revenue was up 11% YoY to RUB56bn, while MegaFon’s 1Q12 mobile services revenues rose 13.4% to RUB58bn in 1Q12. VimpelCom’s mobile data sales rose 39% YoY to RUB5.5bn, while MegaFon’s respective sales were up 32% YoY to RUB8.1bn in 1Q12 VimpelCom’s Russian EBITDA margin decreased by 0.8 ppt YoY (-1.9 ppts QoQ) to 41.3% in 2Q12. To compare, MegaFon’s OIBDA...
14.05.12
FSK and MRSK Holding might be merged – Sechin, negative for MRSKs
Interfax has just reported acting Deputy Prime Minister Igor Sechin as saying that FSK and MRSK Holding might be merged in the future, creating a national grid company. He did not provide any details on timing or the structure of the potential deal. Bottom line While it is not particularly certain from Sechin’s statements, they might indicate that the government may merge the MRSKs with FSK, instead of privatising the distribution companies. If this scenario is the case, it would imply that MRSKs’ strongest potential trigger – which we consider to be privatisation – is not going to be realised....
14.05.12
Magnit Releases April Trading Update - Neutral
Magnit has just released its April operating data. Revenue advanced 32% YoY to RUB135bn during the first four months of the year thanks to a 34% YoY selling-space increase and a 2% decline in LfL sales, on our estimates. The spread between revenue and selling space growth widened in Apr 2012 to 6% (a proxy for LfL sales) from 3.7% in March. However this tendency was expected due to the cannibalisation effect between Magnit stores. Additionally, the company has announced that it will launch a new format, ‘Magnit Family’, which will offer a wide assortment (above 6,000 SKUs) at hypermarket...
12.05.12
Acron to Bid For a Polish Fertiliser Maker?
Reuters reported yesterday (11 May) that Acron could be interested in acquiring a stake in Polish chemical company Azoty Tarnow. Poland’s Treasury Ministry has put its 32.1% stake in the company up for privatisation this year. No other details have been disclosed. Azoty Tarnow reported $1.8bn in 2011 revenue with EBITDA and net profit coming at a respective $312mn and $156mn. Almost half of the company’s revenue in 2011 was generated by sales of nitrogen-based fertilisers; more than 40% of the revenue came from the sale of plastics and OXO alcohols. Its net debt/EBITDA ratio as of YE11 was just...
12.05.12
Mostotrest to Build a RUB7.1bn Port in Sochi
RBC Daily reports today (12 May) that Mostotrest has won a tender to construct a sea port in Sochi. The construction project, which is worth RUB7.1bn, would be executed over the next 17 months and should be completed before the start of the Sochi 2014 Olympics. Bottom line We view the news as moderately positive for Mostotrest as the new project would add RUB7.1bn to the company’s RUB320bn backlog at YE11. ...
12.05.12
TNK-BP Limited’s Board of Directors Issues will not Impact 2011 Dividends of TNK-BP Holding
Vedomosti reports this morning (12 May) that shareholders of TNK-BP Limited (at the very top of the TNK-BP Group structure) will not receive any dividends until the company finds new independent directors for TNK-BP Limited’s board of directors. Two independent non-executive directors from this board, Former German Chancellor Gerhard Schroeder and James Leng, stepped down recently. Importantly, for equity investors in TNK-BP Holding, the latter’s board is fully functional and at its last meeting on 4 May 2012 set the date for TNK-BP’s AGM as 28 June 2012, and the record date as 14 May 2012. They also agreed the...
12.05.12
TGK-7 FY11 IFRS Results: Deterioration YoY, Below Consensus(-)
TGK-7 reported its FY11 IFRS results today (12 May) which are uninspiring overall: EBITDA excluding non-recurring items has fallen by 32% YoY in rouble terms to RUB6.3bn, while net income adjusted for non-recurring items has decreased by 56% YoY to RUB2.4bn, bringing EBITDA margin and net margin to 9.4% and 3.6%, respectively. The figures came in 25% and 38% below our and consensus estimates, respectively, on adjusted EBITDA, and 40% and 52% below our and the consensus forecast, respectively, on adjusted net income. Bottom line We consider the news negative for TGK-7’s stock price performance, due to deteriorating earnings and...
11.05.12
Vozrozhdenie to Hold AGM on 29 June, Register Closes Today
Today (11 May) Vozrozhdenie announced that its board of directors has set the AGM date for 29 June. The cut-off date for AGM and dividends participation is today. In line with previous years, the board has recommended dividends of RUB0.5/ordinary share and RUB2/preferred share, which amounts to negligibly small, in our view, dividend yields of 0.1% and 1.2%, respectively....
11.05.12
State’s Stake in Apatit to Be Sold By 31 May
Interfax reports today (11 May) that the initial price for the privatisation of the state’s 25% of Apatit’s common shares will be set at RUB10.5bn. This implies a RUB42bn valuation for 100% of Apatit’s common shares, or $210/share (below the current market price of $270/share). The results of the privatisation tender are due to be announced by 31 May. We view the news as neutral for Apatit and PhosAgro....
10.05.12
Mechel 2011 GAAP results. Neutral.
Mechel today (10 May) released its 2011 GAAP results which are mostly in line with expectations. Revenue grew by 29% YoY to $12.5bn, EBITDA rose 19% to almost $2.4bn, and net income of $728mn was up by 11% YoY. Bottom line We view the results as neutral. They may however be positively received by the market as there has been concern that due to one-offs, the bottom line would be diminished which would have reduced the size of preferred dividends. We expect the company’s board meeting, at which questions on dividends will be answered, to take place in the next...
10.05.12
Sberbank 4M12 RAS Results: Impressive Loan Book Growth, Profit Supported by Provisions Release
Sberbank released its 4M12 RAS operating results today (10 May). The figures reveal a healthy April net profit of RUB29.9bn, bringing 4M12 earnings to RUB127.3bn. Key takeaways: The loan book continues to show impressive dynamics with retail loans adding 4.5% MoM in April and corporate loans increasing by 1.1%. In YoY terms, loan growth looks particularly robust: 49% on the retail side and 34% for corporates. Deposits in April grew on par with the loan portfolio, adding 1.9% MoM on aggregate (+2.4% in retail and +0.7% in the corporate segment). The loans-to-deposits ratio remained relatively high for Sberbank at 106%...
04.05.12
Mechel 4Q11/2011 GAAP Preview
Mechel is to report its 4Q11 and full year 2011 GAAP results on Thursday (10 May). We expect 4Q to be slightly weaker vs 3Q due to lower volumes sales. At the same time we anticipate that the bottom line in 4Q will be stronger assuming there are no one-offs as seen in 3Q. We expect full year revenue to rise by 31% YoY to $12.7bn and EBITDA to rise by 24% YoY to almost $2.5bn. We expect net income of $739mn representing 13% YoY growth. ...
03.05.12
Renault May Gain Control of AvtoVAZ by Mid-2014
Interfax reports today (3 May) that by mid-2014, Renault-Nissan and Russian Technologies plan to create a joint venture under which Renault would invest about $750mn, giving it a 67.13% stake in the JV. The joint venture would hold 74.5% of AvtoVAZ, the report said. We believe that Renault plans to contribute its 25% stake in AvtoVAZ along with the reported $750mn in cash, giving it effective control of AvtoVAZ (the JV would hold 74.5% of AvtoVAZ’s equity, and Renault’s share would be 67.13%, giving it effective control of 50.01% of AvtoVAZ, according to Renault’s press release). We also estimate that...
03.05.12
CTC Media Reports Strong 1Q12 Results
CTC Media reported its 1Q12 sales today (3 May), which grew 15% YoY to $191mn and beat Interfax consensus by 5.5%. Growth was supported by a boost in sublicensing and production revenues, which expanded 5x, while advertising sales (95% of the sales mix) grew by 11% YoY. OIBDA gained 38% YoY to $55mn, 15% above consensus. Net income increased 43% to $33mn, 18% above consensus. CTC Media commented that its Russian channels are now approximately 85% sold out for 2012 at higher prices than in 2011. The company noted that the domestic TV market grew by 10% in rouble terms...
03.05.12
Some Positive News re AVAZ
Report: By mid-2014 Renault and Russian Technologies are to create a JV that will own 74.5% of AvtoVAZ. Renault plans to invest $750mn in exchange for a 67.13% stake in the JV, thus valuing 100% of AvtoVAZ at around $1.5bn vs its current market cap of $1.1bn and $1.2bn the French company paid for a blocking stake back in 2008. Short-term positive for AVAZ, but more details are needed....
03.05.12
EDC Reports 1Q12 Update − Neutral
(BUY; TP: $35/GDR, CP: $28.5/GDR) Eurasia Drilling Company released its 1Q12 operational and financial highlights today (3 May). Revenues reached $746mn, up 50% YoY and 5% higher QoQ, but 7.5% below our estimate ($806mn). The reason for the deviation was the lower price received per meter drilled (we expected 3% growth in rouble terms). The EBITDA margin decline to 20.3% (vs 22.1% in 1Q11 and 21.1% in 4Q11) was in line with our estimate and explained by seasonality and a higher share of horizontal drilling, which involves more expenses for third-party services. Management said it is confident that the company’s...
28.04.12
Lenenergo’s FY11 IFRS Figures above Consensus, But Still Show Deterioration YoY
Lenenergo reported its FY11 IFRS results today (28 Apr), which look uninspiring overall: EBITDA excluding non-recurring items contracted 12% YoY to RUB10.7bn and adjusted net income fell 34% to nearly RUB3.4bn. While the numbers show a decline in earnings, they came in above both our and consensus expectations: adjusted EBITDA beat consensus by 9%, while net income was 89% above market forecasts. Higher connection fee revenue (which has a generally neutral effect on valuation since assets financed via connection fees are not included in RAB and thus do not provide a return on invested capital) and lower non-controllable costs than...
28.04.12
Irkutskenergo FY11 IFRS Results Decent, But Reveal Significant Value Extraction Risks
Irkutskenergo reported its FY11 IFRS results today (28 Apr), which look reasonable overall: EBITDA excluding non-recurring items increased 17% YoY to RUB22.5bn, while adjusted net income expanded 38% YoY to RUB13.8bn. EBITDA came in 4% below our estimate while net income missed our forecast by 3% (consensus figures are not available), which we consider to be generally in line with our expectations. Importantly, however, while operating cash flow reached a significant RUB19.7bn, roughly two-thirds of this amount was used for questionable acquisitions from – and loans to – its major shareholder Eurosibenergo and its affiliates. We believe these problematic deals...
28.04.12
Norilsk Nickel 1Q12 Operating Results Weaker Due to Seasonality – NEUTRAL
(HOLD, TP: $19.30/GDR), CP: $17.73/GDR) On Friday night (27 Apr) Norilsk Nickel released its 1Q12 operating results which were weaker both QoQ and YoY with the notable exception of nickel (up 7% YoY, but down 5% QoQ) and platinum (down 2% YoY, but up 2% QoQ). Copper production fell 6% YoY (-10% QoQ), while palladium was down 5% YoY (-8% QoQ). The reductions were driven primarily by seasonal factors and scheduled outages. A reduction in PGM output also came due to excessive stock build-up in previous periods. Bottom line The company's 1Q results are usually weaker than the other quarters...
28.04.12
Razgulay to Sell Assets in 2012 to Support Deleveraging – Marginally Positive
GRAZ (Under Review; CP: $0.8) Interfax reported today (28 Apr) that Razgulay plans to start selling assets in 2012 in order to decrease its debt burden. The company hopes to raise about RUB6bn, which would reduce its debt by 25% to around RUB19bn (Razgulay had RUB25bn in debt as of 2010, according to the last available audited financials). Additionally, the company plans to conduct an SPO in 2012 at a price higher than the current market level, the report said. Bottom line The stock could react positively to the news, but we maintain our conservative view on Razgulay as the...
27.04.12
MRSK Holding FY11 IFRS Results In Line with Consensus, Neutral
MRSK Holding has just reported its FY11 IFRS results which look decent overall: EBITDA excluding non-recurring items expanded 13% YoY to RUB121.1bn driven by the introduction of the RAB regulatory method at most of the company’s branches from 1 Jan 2011. This figure has beat our estimate by 12% but fallen short of the consensus estimate by 1%. Adjusted net income has grown by 7% YoY to RUB28.4bn, which is 20% above our and 3% below consensus estimates. Bottom line Since the reported numbers are in line with consensus, we view the results as neutral for MRSK Holding and reiterate...
27.04.12
Ros Agro Releases Weak FY11 Financial Data - NEGATIVE
AGRO (NR, CP $7.24) Ros Agro released weak FY11 financial results today (27 Apr), which did manage to exceed consensus on EBITDA and net income. Revenue increased 28% YoY to RUB40bn, while gross profit lost 21% YoY and deflated to RUB8.4bn. This pressed gross margin to 21% in 2011 vs 34% in 2010. The main disappointment came from the sugar division (down 49% YoY to RUB2.8bn in gross profit) due to losses from trading sugar derivatives and low white sugar prices after the bumper crop in 2010-11. The segment’s gross margin plummeted to 11% in 2011 vs 34% in 2010....
27.04.12
InterRAO Reports Uninspiring FY11 IFRS Results - Negative
InterRAO released its FY11 IFRS results today (27 Apr) which do not look encouraging overall. EBITDA excluding non-recurring items increased only 4% to RUB34.2bn, 20% below Bloomberg consensus. Adjusted net income expanded 2.2x to RUB29.5bn, 7% below consensus. Bottom line Since the results are below consensus on both adjusted EBITDA and net income, we view them as moderately negative for InterRAO’s share price performance. ...
27.04.12
LUKOIL to Pay Dividends of RUB75/Share − Neutral
LUKOIL’s board of directors has asked the company’s shareholders to approve dividends of RUB75 per share (yield = 4.2%). The record date is set at 11 May. Bottom line The news is neutral for the stock as the dividend is close to our estimate of RUB74/share. ...
27.04.12
Protek Releases Strong 1Q12 Sales Results – POSITIVE
PRTK (BUY, TP $1.3, CP $0.9) Protek released a strong 1Q12 trading update today (27 Apr), which demonstrated consolidated revenue growth of 19% YoY to RUB28.5bn. This was attributable to a robust performance by the distribution segment, which advanced 17.5% YoY to RUB24.6bn due to Protek’s focus on commercial market sales. The retail and production divisions also did pretty well, recording top-line growth of 12.5% and 20% YoY, respectively, to reach RUB4bn and RUB1.6bn. In the retail business, Protek demonstrated positive LfL sales growth of 4.2% driven mainly by an increase in LfL basket (up 10.5%) rather than traffic (down...
27.04.12
PHST FY11 IFRS and 1Q12 Operating Results
PHST LI (BUY; TP$22.5; CP$17.6) Pharmstandard posted strong FY11 IFRS results today (27 Apr). Revenue was up 43.7% to reach RUB42.7bn driven mostly by the Third Party Products (TPP) division which does not have a notable impact on Pharmstandard’s consolidated profitability. EBITDA added 23% to reach RUB11.9bn while earnings were up 23% to RUB8.8bn. The 1Q12 operating data is gloomy: revenue was down 30% YoY to RUB8.2bn due to a drop in TPP sales which is a function of their strong growth in 4Q11 (+165% YoY in roubles) when the company shipped almost all the TPP drugs intended for 2012....
27.04.12
Globaltrans Acquires Metalloinvestrans for $540mn
(BUY, TP: 19.00, CP: $17.63) Globaltrans announced today (27 Apr) that it has acquired Metalloinvesttrans, a large railway operator, from Metalloinvest for $540mn. At YE11 Metalloinvesttrans (MIT) operated 9,202 railcars, 8,256 of which it owned and had an average age of approximately 8.7 years. As part of the transaction, Globaltrans and Metalloinvest have agreed a three-year service contract for the transportation of cargoes owned by the latter. The price paid for MIT translates into $65,400 (RUB1,93mn) per railcar owned. This is about 30% higher, on our estimates, than the current market cost for a gondola railcar of this age. However...
26.04.12
Norilsk’s Board Confirms AGM Date of 29 June
(HOLD; TP: $19.30/GDR, CP: $17.36/GDR) Norilsk Nickel’s board of directors has officially confirmed that the company’s AGM will take place on 29 June. The date of the register’s close, which will determine which shareholders are eligible to vote at the AGM, is 24 May. The approval of distribution of profits, including dividends, is on the AGM’s agenda. The board has not yet recommended a dividend payment for FY11 and in fact it has not confirmed whether the company expects to pay any dividends at all this year. However, should Norilsk decide to pay a FY11 dividend, we believe the cut-off...
26.04.12
RusHydro Releases Neutral FY11 IFRS Results (o)
RusHydro reported its FY11 IFRS results today, which look neutral overall. The numbers are not directly comparable YoY, nor with our or Bloomberg consensus estimates due to complicated consolidation methods: the numbers include the results of the five supply companies transferred to InterRAO (i.e. ‘disposal’ group) but only for the period of ownership (from mid-2010 till 28 Mar 2011); RAO Far East’s consolidated accounts (for full years 2010 and 2011) and Bashkir supply company’s accounts (from the 12 Sep 2011 acquisition date). Excluding the disposal group’s results and non-recurring items, the company’s EBITDA was up by only 4% YoY to...
26.04.12
ALROSA: AGM Register to Close on 11 May
ALROSA announced today (26 Apr) that the register for participation in the upcoming AGM (30 June) will close on 11 May. Past experience suggests this will also be the cut-off date for determining which shareholders will be eligible to receive dividends. As we reported earlier, the recommended dividend for FY11 is RUB1.01/share, which implies a yield of just under 3.4%. The payout is subject to approval at the AGM. Bottom line We see this news as supportive of the stock as it means that current and potential shareholders still have an opportunity to receive dividends from ALROSA. ...
26.04.12
PotashCorp Reports Weak 1Q12 Financials, Cuts 2012 Outlook (-)
PotashCorp today (26 Apr) released a weak set of 1Q12 financial numbers with EPS of just $0.56 ($0.84 a year ago) vs Bloomberg consensus of $0.64. The company cut its 2012 EPS guidance to $3.20-$3.60 from the $3.40-$4.00 it gave just three months ago. PotashCorp also revised its 2012 estimate for global potash demand to 53-56mn tonnes from the previous guidance of 55-58mn tonnes. The company cites poor potash demand in offshore markets, particularly in India, as the key reason behind its weak 1Q12 financials. We note that PotashCorp’s potash segment (1Q12 gross profit of $327mn, down 56% YoY) showed...
26.04.12
MMK 1Q12 Operating Results + ATON's view on what to expect from the Russian steel industry in 1H12
MMK announced its 1Q12 operating results today (26 Apr). The numbers show a QoQ improvement, with crude steel output rising 10% QoQ, to 3.4mnt and rolled product output increasing 5% vs last quarter, to just under 2.8mnt. Encouragingly, production of high value-added products at MMK’s domestic facilities was up 16% QoQ, at 938kt. However, the gains in production were offset by generally weaker prices (both QoQ and YoY) although most of the downstream product prices remained robust, on average, showing only a minor reduction QoQ and a slight increase vs 1Q11. The company has a positive outlook for 2Q12, hoping...
26.04.12
TGK-1 FY11 IFRS Results: Healthy Improvement YoY, but Below Estimates (-)
TGK-1 reported its FY11 IFRS results today (26 Apr) which demonstrate a healthy improvement over the previous year: EBITDA excluding non-recurring items has grown 45% YoY in rouble terms to RUB12.6bn, driven by electricity market liberalisation and new capacity commissioning. Net income adjusted for non-recurring items has increased only 5% YoY to RUB4.3bn due to interest expenses surging 7.4x YoY. Despite significant YoY improvements, the figures came in 40% and 9% below our and consensus estimates, respectively, on adjusted EBITDA, and 66% and 31% below our and the consensus forecast, respectively, on adjusted net income. The major deviations from our...
26.04.12
Chelyabinsk Zinc 2011 IFRS Results: Negative!
Chelyabinsk Zinc reported its 2011 IFRS results today (26 Apr) which came in unexpectedly weak. Revenue grew by 8% YoY to RUB12.8bn driven by production volume growth. This figure was in line with expectations. However, EBITDA declined by 20% YoY to RUB2.2bn, materially below our and market estimates. Net income fell by 27% YoY to RUB1bn, another considerable miss. Bottom line We see the results as poor and believe they support our negative view on the company. We reiterate our SELL rating on the stock (PT: $1.9/share vs $2.6 currently). Chelyabinsk Zinc: 2011 IFRS results ($ mn) 2010 2011 YoY...
25.04.12
Russian Sea Posts FY11 Results - Negative
RSEA (NR, CP: $3.7) Russian Sea released mixed FY11 and 1Q12 financial results today (25 Apr). In 2011 revenue advanced roughly 8% YoY to RUB18.6bn with the chilled and frozen segment contributing 80% to top line. Gross profit increased 21% YoY to RUB2.4bn, while gross margin added 1.4 ppts YoY to 12.7% in 2011. However, within the segments the trends were mixed. In the chilled and frozen segment the company faced higher purchasing costs which were not fully transferred to customers (gross margin therefore declined 0.4 ppt to 11.9%). In the ready-to-eat segment the situation was reversed: gross margin doubled...
25.04.12
VTB Supervisory Board Recommends Dividend of RUB0.00088/Share
Today (25 Apr), VTB’s supervisory board scheduled the AGM for 8 June and recommended a dividend of RUB0.00088/share, which corresponds to a dividend yield of 1.4%. The cut-off date is set for tomorrow, 26 Apr. ...
25.04.12
MRSK Siberia FY11 IFRS Results: Significant Improvement YoY, but Below Consensus
MRSK Siberia reported its FY11 IFRS results today (25 Apr), which look encouraging overall. EBITDA excluding non-recurring items expanded by 228% YoY to RUB4.1bn, but this was 16% below our estimate and missed consensus by 14%. The main reason for the deviation from our forecast was lower than expected electricity distribution revenue. The major driver for earnings growth remains the transition of most of the company’s branches to the RAB regulatory method from 2011. Bottom line Since the results came in below both our and consensus estimates, we rate them as neutral to marginally negative for MRSK Siberia. MRSK Siberia...
25.04.12
Chelyabinsk Zinc 2011 IFRS Preview
Chelyabinsk Zink is due to report its 2011 IFRS financial results tomorrow (26 Apr). We expect 8% YoY revenue growth to RUB12.7bn driven primarily by production growth as average realised zinc prices have been nearly flat YoY. We anticipate EBITDA growth of 8% to nearly RUB3bn while net income should rise by 15% to RUB1.6bn. Chelyabinsk Zinc: 2011 IFRS results preview (RUBmn) 2010 2011 Aton estimate YoY change Interfax consensus Revenue 11,810 12,706 8% 12,749 EBITDA 2,745 2,969 8% 2,568 EBITDA margin 23% 23% 20% Net income 1,414 1,625 15% 1,389 Source: Company data, Interfax, Aton estimates ...