Euroxx Research DAILY NEWS...

MACRO NEWS

Troika review to be presented to Eurogroup on October 8 (press)

According WSJ citing EU officials, troika will present its Greek program review to the Eurogroup on October 8, not in September as it was initially expected. As a result, Greece will not receive the next tranche of €31bn (initially due in late June) before October, while troika mission will remain in Greece all of September.

PM met FinMin on cost cutting measures

Following a meeting with FinMin, PM Antonis Samaras told reporters that the government is seeking “the most effective cuts to the deficit with the least possible pain for citizens” adding that “we are looking everywhere, but will not return to measures that have failed in the past”. Reportedly, one of the key obstacles in the government’s efforts to finalise cost cutting measures of €11.5bn, and particularly €3.5-4bn that have not yet been identified, is the labor reserve issue with the leaders of PASOK and Democratic Left having expressed their opposition also due to its failed implementation in the recent past.

It is also noteworthy that Alternate FinMin Christos Staikouras told SKAI that the package of cost cutting measures should be finalised before the next Eurogroup due on September 14.

International tourist arrivals down 3.8% y-o-y in 7M’12

According to provisional data released by the Association of Greek Tourism Enterprises (SETE), international tourist arrivals at the main airports (representing 95% of all airport international arrivals and 72% of all international arrivals in Greece) eased 2.1% y-o-y to 2.28m in July and 3.8% y-o-y to 6.34m in 7M’12 (6M’12: -4.6%). 

Fitch on Greek house prices

Fitch said yesterday that Greek house prices will drop by an additional 17% on top of the 20% they have already dropped. The house price forecast is closely tied to Fitch’s assumption that the severity of the economic downturn, unemployment and austerity programme will wane in 2014. S&P expects the severity of the recession to weaken next year after a 5% fall in GDP this year, and unemployment to peak in 2013 at 20% before dropping slightly to 18% in 2014.

Manos Giakoumis, Research Director, giakoumis@euroxx.gr, +30 210 6879322

CORPORATE NEWS

Banking sector – Alpha, Eurobank and National submitted offers for Emporiki

As expected, Alpha Bank, Eurobank and National Bank announced yesterday they have submitted binding offers for the acquisition of Emporiki Bank, which are subject to regulatory approvals. Reportedly, the completion of Emporiki Bank sale is seen by the end of the month or mid September with HFSF having set as prerequisite for the sale the recapitalisation and full funding of Emporiki before it is sold. Press reports also note that the BoD of Credit Agricole will convene on August 27 to discuss the offers.

In our view, the acquisition of Emporiki by one of the three large banks - along with the acquisition of ATEbank’s sound part by Piraeus - will definitely alter Greek banking landscape and we anticipate that the potential sale of Hellenic Postbank and Geniki Bank (at a later stage) will result in further consolidation in the  sector.

Manos Giakoumis, Research Director, giakoumis@euroxx.gr, +30 210 6879322

Mytilineos <MYTr.AT/MYTIL GA, €2.07, Overweight, TP: €6.00> - H1’12 results

Mytilineos announced a weak set of H1’12 results with group figures coming broadly-in-line with consensus at the sales and EBITDA levels and below at the bottom line. The strong profitability of the Energy-related operations offset, although partially, the expected decline in the performance of the EPC sector as well as the losses of the Metallurgy activities, which in conjunction with a higher y-o-y depreciation burdened bottom-line results.

In a nutshell:

·         Sales reached €714.4m (+0.5% y-o-y & 4.2% below consensus)

·         EBITDA settled at €80.5m (-25.3% y-o-y & 3.5% below consensus)

·         EBITDA margin declined to 11.2% from 15.1% in H1’11

·         Bottom line posted €8.5m gains (-72% y-o-y & 42.7% below consensus)

Finally, group’s Net debt decreased by 8.5% y-o-y to €647.3m (vs €707.3m in H1’11), while FCF, although negative, reached -€43.6m in H1’12 vs -€161.1m in H1’11.

Metka <MTKr.AT/METTK GA, €6.35, Overweight, TP: €11.00> - H1’12 results

METKA released yesterday a weak set of H1’12 results, which came below consensus’s estimates across-the-board, mainly due to the economic conditions that prevail in the countries where the group operates. In particular, Greek operations were negatively affected by the domestic recession, which led to the cancellation or postponement of any investments planned for projects of interest to the company. In this context, the projects under way with PPC, became a loss-making activity for the group, due to significant delays in implementation and financing from the latter.

On the flip side, foreign operations performed better-than-expected and offset, although partially, the aforementioned losses. In specific, Turkey, contributed 32.6% of total H1’12 revenues (vs 52.7% in H1’11), while Syria generated 40% of total revenues from 17.1% in H1’11. Overall, 83.5% of H1’12 revenues were generated abroad versus 77.7% in H1’11, while group backlog stands at €1.5bn.

In a nutshell:

·         Sales reached €298.7m (-37.5% y-o-y & 11.9% below consensus)

·         EBITDA dropped to €50.6m (-29.9% y-o-y & 7.9% below consensus)

·         EBITDA margin settled at 16.9% from 15.1% in H1’11

·         Net profit settled at €40.1m (-19.0% y-o-y & 6.4 below consensus)

Yiannis Sinapis, Construction/Energy/Gaming sinapis@euroxx.gr, +30 210 6879353

Corporate Calendar

09/08/2012: Hellenic Telecom – H1’12 results

17/08/2012: Hellenic Petroleum – Ex-div (€0.45)

21/08/2012: CCH - H1’12 results

23/08/2012: OPAP – H1’12 results

29/08/2012: Titan Cement - H1’12 results

29/08/2012: Hellenic Petroleum - H1’12 results

30/08/2012: Terna Energy - H1’12 results

30/08/2012: Folli Follie - H1’12 results

04/09/2012: Terna Energy - Ex-capital return (€0.05)

05/09/2012: Terna Energy - Ex-bonus date

07/09/2012: Jumbo - Ex-capital return (€0.21)

26/09/2012: EXAE - Ex-capital return (€0.08)

05/11/2012: Motor Oil – Ex-cap. return (€0.10)

08/11/2012: Hellenic Telecom – 9M’12 results

12/11/2012: Titan Cement - 9M’12 results

12/11/2012: Hellenic Exchanges - 9M’12 results

20/11/2012: OPAP - 9M’12 results

21/11/2012: Metka – 9M’12 results

21/11/2012: Mytilineos – 9M’12 results

Best regards,

Euroxx Research

tel:     +30 210 6879400

fax:    +30 210 6894537

email: research@euroxx.gr

Euroxx Securities S.A.
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