Prague-Listed Phillip Morris CR nets CZK 1.692 Bln Last Year, Above Expectations

Source from:  INTERFAX 03/31/2009

Prague-listed tobacco group Phillip Morris Czech Republic (PMCR) posted an unconsolidated net profit of CZK 1.534　bln　(down 36.7% year-on-year), the company said Monday in the invitation　to　the　company's annual general meeting (AGM) on April 29. "PMCR has not given any details as to the amount of dividends to be paid out [as　this]　will　be　decided　on the AGM," Ceska sporitelna analyst Radim Kramule said, adding expectations are the tobacco company will pay out again 100% of its unconsolidated profit. "[That]　should　translate　into　gross　dividend　of CZK 559/share (our estimate　stood at CZK 458/share) or nearly 10% gross dividend yield [as at Friday's　closing　price　of　CZK 5,675)," Kramule said, adding Ceska sporitelna had estimated unconsolidated net profit at CZK 1.257 bln. "The reason　for better than expected results could be - higher exports, higher average　margins on different product mix or higher local volumes sold," Kramule　said.　"All　in　all　we see the results as positive and given the　recent　CZK　1-2/pack　increase　in　retail　prices we remain optimistic　about　the　stock　price　in　2009.　We　maintain　our 'Buy' recommendation and 12M target price of CZK 8,900." Atlantik　FT　analyst Milan Vanicek said the slump in unconsolidated net income likely　stems　from　the　unfavourable stockpiling issue in Czech Republic ahead of the January 2008 tobacco tax hike, as well as the huge stockpiling　in　Slovakia　in　2007　causing　the　2008　Slovak sales to decrease　substantially. Both effects were already seen in first half of 2008 figures. "As the　unconsolidated net income only slightly beat our projection (by 7%) and　due　to　the　rather expected dividend yield (9.9%) we expect a neutral reaction of the stock today [Monday]," Vanicek said. "Due to　the　future net income (dividend) stabilization expectation and due to the　absence of detailed financial figures (released on April 8), we reiterate our long-term 'Buy' recommendation with the one year target price of CZK 7,322." PMCR's annual report will be available only at the day of the AGM. Given the T+3 principle, the record day for 2008 dividends should be April 24. Enditem