Economic news released by SITA on Tuesday, March 20
Central Bank Intervenes against Strong Slovak Crown
The National Bank of Slovakia (NBS) intervened on the Slovak FOREX market on Tuesday to halt strengthening of the Slovak crown through foreign banks. UniBanka dealer Patrik Malec told SITA that interventions started roughly at the level of 32.80 SKK/EUR, which was close to the opening exchange rate. Subsequently, the Slovak currency weakened to 33.10 SKK/EUR.
The dealer said that next development of the Slovak crown against the euro will depend on the fact where the central bank will want to push the crown. Mr. Malec expects the Slovak crown to continue weakening towards 33.30 SKK/EUR. The next facto
Slovakia's Jobless Rate Dropped to 9.2 Percent in February
Registered jobless rate in Slovakia reached 9.2 percent at the end of February, down 0.25 percentage points compared with the previous month, announced the National Labor, Social Affairs and Family Office on Tuesday. Compared with February 2006, the jobless rate went down by 2.46 points. Unemployment rate calculated from the number of all job seekers was 10.52 percent in February. This is a 0.21-percentage-point decrease compared with the previous month and a 2.66 percentage point drop y/y.
T-Mobile Slovensko Ends 2006 with Revenues of SKK 15.97 Bln.
Mobile operator T-Mobile Slovensko, a.s. closed 2006 with total revenues of SKK 15.965 billion, reported T-Mobile finance director Ivan Bosnak at a press conference on Tuesday. The company reported earnings, before interest, taxes, depreciation, and amortization (EBITDA), of SKK 6.441 billion, which is 5 percent more than in 2005. Mr. Bosnak pointed to the significantly positive development of average revenue per user (ARPU), which increased 3 percent y/y from SKK 593 to SKK 608 in 2006. T-Mobile invested almost SKK 3.3 billion last year, which is the highest investment volume in the past three years.
AXA Plans to Widen Its Activities in Slovakia
Following its entry to the Slovak market through an acquisition of Winterthur Group last year, the French group AXA plans to extend its activities in Slovakia. "This May we plan to offer our clients an opportunity to invest in our mutual funds," AXA director general for the Czech Republic and Slovakia, Petr Zaluda, commented on the group's next steps in Slovakia at a news conference on Tuesday. The company wants to provide new kinds of supplemental insurance and new life insurance products. "We would like to start providing non-life insurance at the end of this year, or at the beginning of next year," added Mr. Zaluda.
Turnover of Baumax in Slovakia Grew 17 Percent Last Year
DIY retail chain Baumax Slovensko reached a turnover of SKK 4.2 billion in Slovakia in 2006, which is 17 percent growth compared with 2004. This result boosted the company's leading position on the market of hobby equipment and home and garden materials. Its share in the total turnover of the Austrian DIY retail chain was ten percent last year. Also, the number of registered paying clients posted an increase in 2006 of 11.8 percent to 4.5 million, said head of Baumax Slovensko and Baumax CR Jiri Sulc. Austrian DIY retail chain Baumax, specializing in hobby equipment and home and garden materials, has operated on the Slovak market since 1994.
Slovakia's Construction Output Exceeded EU Average also in January
Output in the construction sector of Slovakia grew 20.4 percent year-on-year in January 2007. According to data of the European Statistical Office Eurostat, this was the sixth highest growth of the thirteen EU countries that provided their data to Eurostat. Poland reported the highest growth at 60.3 percent. In January, the seasonally adjusted output of the Slovak construction sector increased 2 percent from December. In the whole EU, which already has 27 countries as of this January, construction production grew 7.3 percent y/y on average and posted a 1.1 percent increase compared with December. In the 13-member Eurozone, output increased 10.4 percent y/y and 0.6 percent m/m.
German Investors Satisfied with Economic Situation in Slovakia
German companies operating in Slovakia are satisfied with the current economic situation here, shows a survey by the Slovak-German Chamber of Commerce and Industry (SNOPK). The chamber interviewed over ninety companies. Most of them believe that the situation on the Slovak market will be develop favorably this year as well, and are willing to continue investing here, said SNOPK. German investors consider Slovakia an attractive country particularly due to its low tax burden, simple tax system and low labor costs.
Slovakia Will Not Float Eurobonds in the First Quarter as Planned
The Finance Ministry's Debt and Liquidity Management Agency (ARDAL) will float the next Eurobond issue later than originally planned. According to previous information, the agency originally wanted to float the EUR 1 billion benchmark issue in Q1 2007. Maturity of Eurobonds with a fixed yield should have ranged from 10 to 20 years. However, this will not happen by the end of March and the Eurobond issue will probably be floated in the Q2 2007, stated the head of ARDAL debt management department, Tomas Kapusta. ARDAL originally wanted to time the Eurobond issue for the first quarter, when government obligations worth over SKK 47 billion were maturing. There is, however, enough money in the state pocket at the moment, and the agency is therefore not urgently pressed to issue new bonds.
DDP Stabilita Pension Firm with SKK 31.35 Mln. Taxed Profit in 2006
Supplemental pension insurance company (DDP) Stabilita closed last year with a taxed profit of SKK 31.35 million. The insurer's profit from financial operations amounted to over SKK 123 million. The insurer, as a non-profit organization, is obliged to distribute its entire profit (after deducting transfers to the compulsory reserve fund) among its policyholders and receivers of pension benefits. The gross average appreciation rate of policyholders' contributions managed by the company was 4.72 percent last year, DDP Stabilita representatives informed SITA. Shareholders' equity of DDP Stabilita stood at SKK 97.17 million in late December 2006, of which SKK 50 million was share capital.
MONEY MARKET: NBS Rejects All Bank Bids in Repo Tender
The National Bank of Slovakia (NBS) supported further its direct interventions on the FOREX market on Tuesday with measures on the interbank market.The central bank on Tuesday rejected all bank bids in the two-week sterilization repo tender, representing SKK 199.717 billion. The market will thus slip into huge liquidity surplus on Wednesday because a maturing SKK 121.901 billion will return to the sector. Prices along the yield curve headed steeply downward, which may reduce demand for the Slovak currency. On Tuesday, one-day deposits were quoted at 3.2/3.4 percent p.a., and the price of one-week money was 3.25/3.45 percent p.a.The price of two-month money was 3.7/4.2 percent p.a., and three- and six-month funds were quoted at 3.8/4.3 percent p.a. Nine- and twelve-month deposits were traded at 3.85/4.35 percent p.a.
Orange Slovensko to Invest SKK 1 Bln in Optical Network this Year
Mobile operator Orange Slovensko will invest approximately SKK 1 billion by the end of the year in an optical network with terminal devices on customers premises. The company thus confirms the plan of its shareholder, the group France Telekom, to build in Slovakia a fixed telecommunications network based on Fiber to the Home (FTTH) technology, i.e., signal transmission through optical-fiber devices terminated directly on the premises of customers, the company announced. Orange Slovensko plans to build optical units in ten Slovak towns by the end of 2007. The investment is to enable an introduction of optical units in nearly 200,000 households. The firm has further invested more than SKK 2 billion in building optical data circuits more than 2,000 kilometers long, and investment in the firm's IP network will reach over SKK 300 million.
Crude-oil Refiner Slovnaft Posts 2006 Net Profit of SKK 6.381 Bln.
Bratislava-based crude oil refiner Slovnaft posted a net profit of SKK 6.381 billion last year, according to international financial reporting standards (IFRS), down 31 percent y/y. The firm posted an operating profit of SKK 7.847, which was 30.6 percent less than a year ago. Operating revenues reached SKK 118.097 billion last year, of which net sales constituted SKK 116.729 billion on operating costs of SKK 110.25 billion. Compared to 2005, operating revenues went up 19.4 percent, while operating costs increased 25.8 percent. The company's annual general meeting on April 20, 2007 is to deal with the approval of the annual individual and consolidated financial statements.
FOREX MARKET: NBS Intervenes Successively Against Strong Crown
The National Bank of Slovakia (NBS) intervened on Tuesday to reverse the strengthening Slovak currency in a series of direct interventions in addition to the regular sterilization repo tender. The central bank intervened in the morning when the exchange rate moved to 32.80 SKK/EUR. Consequently, the Slovak crown started to weaken over 33.00 SKK/EUR. The rejection of all bank bids in the NBS two-week repo tender further influenced weakening of the local currency. Before the close of trading, the crown stood at 33.32/33.34 SKK/EUR. The U.S. dollar was traded against the euro at 1.329 USD/EUR (middle). It was quoted against the Slovak crown at 25.06/25.08 SKK/USD. The cross rate of Slovak and Czech crowns was 1.196/1.198 SKK/CZK.
STOCK MARKET: SAX Index Recovers Part of Monday's Losses
Slovakia's official SAX share index recovered some of its losses from the beginning of the week on Tuesday. Its value went up 0.42 percent or 1.74 points to 413.88 points, owing to shares of the Bratislava-based crude-oil refiner Slovnaft. Turnover on the Bratislava Stock Exchange (BCPB) increased from SKK 262.2 million on Monday to SKK 817.985 million on Tuesday, with as little as SKK 1.045 million in share trading.
INVESTING: Assets in Pension Funds Exceeded SKK 32.2 Bln. Last Week
The net value of policyholder assets in licensed pension fund management companies in Slovakia (DSS) exceeded SKK 32.2 billion as of last Friday. The value of assets in pension funds went up by more than SKK 368.6 million w/w. As of last Friday, approximately SKK 21.2 billion was in growth funds, over SKK 9.7 billion in balanced funds, and more than SKK 1.3 billion in conservative funds.
INVESTING: Net Sales of Mutual Funds at SKK 614.2 Mln. Last Week
Investor demand for open-end mutual funds in Slovakia, managed by members of the Slovak Association of Asset Management Companies (SASS) resumed last week. The volume of net sales climbed to SKK 614.2 million. Only bond funds registered an outflow of money, amounting to SKK 112.8 million. In contrast, a total of SKK 256.6 million flew in equity funds, SKK 197.4 million was directed in money market funds and investors deposited SKK 176.8 million in master funds. The group of guaranteed, secured and real estate funds registered net sales of SKK 71.3 million and mixed funds reported an influx of SKK 24.9 million. With regard to the biggest volume of net sales, Tatra Asset Management did best last week, followed by Slovenska Sporitelna Asset Management and VUB Asset Management.