Most large companies that have filed reports with the Bucharest Stock Exchange so far have posted weaker results in the third quarter against the same time last year.
The nine-month financial results, which investors and brokers alike eagerly awaited to end the downward trend of the Bucharest Stock Exchange of the last few months, have been disappointing for the most part until now.
Losses and reduced profits reported by companies overlapping the bad news in the macroeconomy department and the still troubled international markets are hardly reassuring for investors, after three and a half months of decline during which the market lost 7.7 billion euros of its capitalisation.
Until now, out of the 16 companies that reported their nine-month results, seven posted losses in the third quarter, and four more saw their profit go down.
At the same time, half of them posted declines in turnover.
Grid company Transelectrica Bucharest (TEL), the fifth largest company on the Bucharest Stock Exchange in terms of capitalisation, posted 21.9 million RON (6.5 million euro) losses in the third quarter, compared with 53.6 million RON (15 million euro) profit during the same period in 2006.
"The decline in Transelectrica's profit comes as a surprise, considering that utility companies are generally among the most stable in terms of the trend of results. I believe this decline is already showing in prices, considering shares have been constantly going down when traded in large volumes for the last couple of months now, while I think they could drop even further in the coming days," says Adrian Ceuca, deputy general manager of Broker Cluj.
Transelectrica's nine-month profit is five times lower compared with the same period last year. Company officials say the slump in profit was caused by its own power consumption and by the regulated rates, which generated additional costs nine-times higher than budgeted.
Transelectrica has fallen by around 25% over the last five months compared with its peak in June.
Another unpleasant surprise came from piping producer TMK Artrom Slatina (ART), which posted 15 million RON (4.47 million euro) losses in the third quarter, compared with a 5.9 million RON (1.7 million euros) profit during the same time in 2006. These are the first quarterly losses Artrom has registered in the last two years, which were caused by the 25 million RON (7.46 million euro) losses in the July-September period, probably because of the unfavourable RON/EUR and RON/USD exchange rate trends. The record profit Artrom posted last year was largely due to financial income.
TMK Artrom's shares are among those that registered the highest increases on the Bucharest Stock Exchange over the last few years.
Kandia-Excelent Bucharest chocolate (EXC) in turn posted losses in the third quarter, while paint and enamel maker Policolor Bucharest (PCL) saw its profit go down.
Rompetrol Rafinare Constanta (RRC), Oltchim Ramnicu Valcea (OLT) and Zentiva Bucharest (SCD) are further examples of companies that slipped into the red in the third quarter.
Pentru alte știri, analize, articole și informații din business în timp real urmărește Ziarul Financiar pe WhatsApp Channels
