Electrolux Slovakia Boosts H1 Sales by 8 Percent y/y

Electrolux Slovakia, the division of household appliances posted an 8-percent growth in sale of appliances of Electrolux, AEG and Zanussi trademarks in Slovakia during the first half of 2003. The situation in the monitored period was largely influenced by introducing of new products on the market and a stable strategy of the above trademarks. “The development during the first months of the year confirmed expectations of slow-down in the market growth in 2003,” stated Jozef Brngal, trade director of Electrolux Slovakia. He expects demand for household appliances to refresh in the second half of this year.

Gabor Slovakia Plans its 2003 Sales at SKK 1.925 Bln.

Shoemaker Gabor Slovensko, s.r.o., Banovce nad Bebravou plans its sales to climb to SKK 1.925 billion this year, according to data provided to SITA by Gabor management. Of this amount sales for company’s own products and services should represent about SKK 1.820 billion. The company reported sales of SKK 1.051 billion in the first half of this year.

Illegal Labor Deprives State Pocket of SKK 4.72 Bln. Annually

The National Labor Office (NUP) estimates that illegal labor could cause an annual loss of SKK 4.72 billion to the state budget and insurance funds, Jan Vrbacky, head of the NUP control department told a news conference on Tuesday. The NUP compared the year-on-year fall in the number of unemployed by 80,000 and employment growth that was 26,000 persons y/y. “We assume that these 54,000 people were pushed out to the gray economy,” said Mr. Vrbacky. Illegal labor the most frequently appears in the building and travel industries, trade and restaurants.

Foreign Trade Support will be Centralized in Slovakia

The main goal of the revision to the Foreign Trade Supporting Fund (FPZO) law is to concentrate material-technical, financial and human resources for trade support in the shelter institution. The Slovak Agency for Investment and Trade Development (SARIO) will be a sole authority in charge of investment and trade development and an implementation unit to administer funds from supporting programs. The law on SARIO will cancel FPZO and SARIO will become a universal successor of its assets, rights and duties. The Economy Ministry submitted the revision for the inter-departmental review.

INVESTING: Open-End Mutual Funds Switch to Moderate Losses Last Week

Following two weeks of moderate firming, most of the open-end mutual funds administered by members of the Asset Management Companies Association (ASS) showed slight losses last week. Almost all mutual funds, apart from money market funds, depreciated their units. Net sales of mutual fund units, the difference between the value of issued and returned units, decreased to SKK 341.9 million last week, according to weekly data released by ASS.

Retail Sales of SAPPO Members Up 12.3 Percent in Six Months of 2003

The Slovak Association of Petroleum Industry and Trade (SAPPO) has announced that over the first six months of this year SAPPO’s fuel and lubricant sales have surged by 12.3 percent to over 591 million liters. Motor fuel and lubricant sales in June represented 109 million liters.

FNM to Vote Against Withdrawal of VSZ Shares from Trading

At a shareholders meeting of former steel maker VSZ Kosice scheduled for Wednesday, government privatization agency, the National Property Fund (FNM), will vote against withdrawing VSZ shares from trading on the Bratislava Stock Exchange (BCPB). The FNM executive committee made this decision on Tuesday. FNM holds 16 percent in VSZ. ”The FNM representative will vote against the VSZ share withdrawal from trading on the Bratislava Stock Exchange and a change to VSZ statutes,” FNM spokeswoman Tatjana Lesajova informed SITA. In the near future the FNM should also consider over ways of dealing with its stake in VSZ.

Merina Woolen Fabric Producer Earned H1 Profit of SKK 668,000

Woolen fabric producer Merina, a.s., Trencin, earned SKK 668,000 profit on sales of SKK 535.3 million in H1 2003, which is a significant change in economic results compared with last year when the company was SKK 85 million in the red. Juraj Holec, deputy chairman of the Merina board of directors told SITA that last year’s negative economic results were mainly caused by the bankruptcy of clothing company Ozeta Trencin.

Heineken Slovensko Q1 Sales at SKK 905 Mln.

Heineken Slovensko Brewery, a.s. reported consolidated sales of SKK 905 million in the first quarter of this year. Beer and malt exports made up as much as 29 percent of total sales. Heineken’s share on the respective Slovak market grew 1 percentage point y/y to 42.3 percent, spokesman Peter Svec informed the press on Tuesday.

H1 2003 Wienerberger Capital Expenditures at SKK 7.3 Mln.

Construction materials producer Wienerberger Slovenske Tehelne, s.r.o. (WST) invested SKK 7.3 million into production technologies over the first half of the year. Company representatives informed SITA that among the most important novelties ranks the introduction of a new brick system, which are ground flat with millimeter precision, allowing economical, precise, rapid and ”dry” wall construction. Wienerberger employed 104 people during the first half of the year, earning SKK 27,485 per month on average.

Ludova Banka Provides SKK 572 Mln. in Mortgage Loans over H1

Ludova Banka, a.s., (LB) provided 590 mortgage loans totaling SKK 572 million in the first half of 2003. The bank obtained a mortgage license in October 2002 and since then it has granted 735 mortgages totaling SKK 692.6 million, bank representatives told SITA. The introduction of a floating mortgage rate subsidy caused Q2 clients’ interest on mortgage loans to increase by almost five times from the end of last year.

White Goods Producer Tatramat Reports H1 Profit of SKK 37 Mln.

White goods producer Tatramat, a.s., Poprad earned a gross profit of SKK 37 million in the first half of this year. Operating profit in the firm amounted to SKK 30.3 million and profit from financial operations reached SKK 6.7 million. H1 revenues decreased SKK 14.2 million y/y to SKK 327.8 million. Output stood at SKK 355.2 million, head of the company’s economic department Peter Strbian told SITA.

Collective Investing Terms to Change in Slovakia from Next Year

From next year, asset management companies will have an option to extend their business line with further investment services, for example, investment portfolio management for individual clients. The new law on collective investing, fully harmonizing collective investment rules with the EU, will, however, mean stricter criteria for prudent business in the field of capital adequacy or in the field of reduction and dispersion of the investment risk in a mutual fund. Rules for the distribution of units of mutual funds should change from January 2004, when a simplified sale prospectus will be introduced. The Finance Ministry has submitted the draft law for interdepartmental review.

Elas Company Purchased 100 Percent Share in HT Computers

The new owner of a 100-percent share in HT Computers is Prievidza-based company Elas, s.r.o. The acquisition contract for HT Computers, a.s. shares, which was a subsidiary of HTC Holding, a.s. was signed on Monday by representatives of both companies. By this purchase, Elas company s.r.o. wants to strengthen its position on the Slovak information technologies market, while HTC Holding wants to concentrate on its core business activity, which is machine building. Acquisition of 100 percent of HT Computers shares by the Elas company is conditioned on approval by the Anti-Trust Office (PMU).

Advertising Volume Exceeded SKK 8 Billion in H1 2003

The volume of advertising in the media totaled SKK 8.02 billion over the first half of 2003. This translates into an 18.7-percent increase compared with the previous year’s period. According to monitoring by TNS company, most money went on television advertising, making up 71.1 percent. The press, with a 19-percent share, was the second biggest advertising medium. Radio advertising followed with 6.4 percent. External advertisements and adverts in cinemas accounted for the rest.

MONEY MARKET: Excess Liquidity to Increase on Wednesday

Excess liquidity, which has been persisting on the inter-bank market for the third week, will increase after settlement of regular Tuesday repo deals by the National Bank of Slovakia on Wednesday. Bids by commercial banks amounted to only SKK 51.905 billion during the regular Tuesday repo tender, while repo deals of SKK 55.8 billion will mature on Wednesday. According to a CSOB dealer, the central bank accepted the bid in full at the average yield of 6.49 percent p.a. The maximum and minimum yield was 6.5 and 6.49 percent p.a., respectively. “A few seconds after the repo tender results were revealed, short money prices decreased to the 5-percent sterilization rate of the central bank,” said the dealer.

Commercial banks deposited SKK 19.210 billion in their reserve accounts in the central bank, meeting the minimum reserve requirement on a cumulative basis at 101.84 percent.

Farmers Ask Cabinet to Solve Crisis in Sector

Despite repeated requests by Slovak farmers and the Slovak Parliament, the Slovak Cabinet is paying insufficient attention to the critical situation in the agricultural sector, said representatives of primary agricultural production, Deputy Speaker of Parliament Viliam Veteska and head of the parliamentary committee for agriculture Miroslav Maxon after their Tuesday meeting. Thus, parties present repeatedly made an appeal to the cabinet to pay extraordinary attention to farmers. They also asked the cabinet to submit a report to parliament on the current situation in the agriculture sector in connection with the extraordinary drought and current economic conditions for farmers. The cabinet should also secure accessible financial funds to set crops for 2004 and overcome the present unfavorable situation.

Slovak Crown Firms About SKK 0.1 Against Euro on Tuesday

During Tuesday’s trading on the foreign exchange market the Slovak crown firmed about SKK 0.1 towards its referential euro. According to Ladislav Benedek, VUB dealer, the Slovak currency began to firm in the morning after several London-based banks, who had previously purchased foreign exchanges, started to focus on Slovak currency purchases. “The Slovak crown firmed from its initial 42.400/42.440 SKK/EUR to 42.200/42.230 SKK/EUR.“ According to the dealer, the firming of the domestic currency was also promoted by the slight valuation of the Czech crown. The Slovak crown closed at 42.280/42.320 SKK/EUR. The Slovak crown was quoted towards the US dollar at 37.290/330 SKK/EUR. The cross rate of the Czech and Slovak crowns was 1.3115/3130 SKK/CZK at the end of trading.

STOCK MARKET: SAX Share Index Slightly Firms to 162.7 Points

On Tuesday the official SAX share index, mainly under the influence of firming VUB shares, gained 0.06 percent or 0.09 points to 162.7 points. Turnover on the Bratislava Stock Exchange (BCPB) rose from SKK 10.069 billion on Monday to SKK 94.06 billion on Tuesday. Transfers of government bonds via direct trades were the most responsible for the significant increase in turnover when share trading accounted for only SKK 2.3 million.

FinMin Maintains that Income Tax Bill Does Not Liquidate NGOs

It is not right when the motivation for making financial donations to non-governmental organizations (NGOs) is only based on tax policy, claims the Slovak Ministry of Finance in reaction to a statement issued by the initiative “Citizens to Themselves” on Tuesday. Approximately 130 non-profit organizations that signed the statement are fighting to change the bill on income tax, according to which, non-profit organizations and churches should also be taxed. The bill also cancels a mechanism for citizens and companies to decrease the tax base by the value of assigned donations.

According to the Ministry of Finance, “direct taxation must serve to fulfill budget goals and it cannot be used for other purposes. Introducing specific tax regimes, for any reasons, leads only to a higher complicity of the tax system, increasing the costs of its application and risks of tax evasion,“ says the Ministry of Finance.

Finance Ministry to Move Price Regulation Powers to other Ministries

A draft revision to the price law moves price regulation and supervision for healthcare products and services to the Health Ministry from January 2004. It also moves regulation and supervision of rental of apartments and non-housing buildings to the Ministry of Construction and Regional Development. The draft revision will also shift within the decentralization of public administration competencies in price regulation from district offices, to be abolished from the start of the year, to higher territorial units.