Focus on Telecoms
While the overall revenue growth of fixed-line operators was weak in 2002, national operator TPSA managed to increase its sales and net profit. The market is dominated by stock-exchange-listed TPSA, which accounts for about 90.5% of fixed-line telecom connections. Meanwhile Netia, the country's largest alternative fixed-line operator, and Szeptel, a minor telecom and data transmission provider, generated losses, largely due to the economic slowdown.
TPSA reported sales of €4.15 billion (zł. 18 billion) last year, up from €4 billion (zł. 17.331 billion) in 2001. BOŚ brokerage analysts are optimistic about TPSA's financial results this year, saying that its reduction of employment costs as a result of last year's restructuring should have a positive impact on results in 2003.
Investors, however, seem to be discouraged by the treasury ministry's plan to give 46 million TPSA shares to Kompania Węglowa, the coal holding company. Likewise, analysts say the give-away is a risky move which could result in a large supply of shares on the stock market in the short term and thus drive down the share price.
Pekao brokerage maintains its "over the market" recommendation on TPSA, saying that the treasury ministry's decisions regarding the share give-away will have an impact on the company's share price this year, as will potential decisions by Kompania Węglowa.
Analysts at Bank Pekao brokerage forecast that TPSA will end this year with a €397.4 million (zł. 1.721 billion) net profit on sales of €4.32 billion (zł. 18.711 billion). At the same time, Millennium brokerage predicts that TPSA's net profit will increase to €303 million (zł. 1.312 billion) this year from €94 million (zł. 840 million) in 2002. Michał Buczyński, telecoms analyst at Millennium bank, forecasts that TPSA's deep restructuring, especially its continued employee layoffs, as well as the improving performance of PTK Centertel, TPSA's mobile operator, will boost its operational profit, Ebitda and net profit.
Netia reported sales of €195.6 million (zł. 604.4 million) for 2002, up from €124.45 million (zł. 538.9 million) in 2001. It finished last year with a €155.88 million (zł. 675 million) net loss, a decrease from a €265.6 million (zł. 1.15 billion) net loss the previous year. So far this year, Netia has already converted most of its €850 million debt into shares. On February 13, the company issued 312 million new shares, quoted as Netia2.
Analysts at CA IB are forecasting a growing demand for Netia's shares after it replaced household appliances maker Amica on the WIG 20. They believe that national pension funds may absorb 17% of the firm's shares.
Analysts also believe that Netia may become an acquisition target since it no longer has a major shareholder following the new share issue, which could boost its share price. Currently, there is an accumulation of shares being sold by Netia's former creditors.
BRE Bank brokerage puts Netia's sales at around €151.7 million (zł. 656.9 million) this year with a net loss of €21.9 million (zł. 94.8 million). The company should see a net profit of €2.42 million (zł. 10.5 million) in 2005.
In addition, BRE Bank brokerage analysts criticise the country's telecommunications law for its imprecision and loopholes, which allow TPSA to retain its stronghold on the fixed-line telecom market. They consider the law's stipulations to be very unfavourable for independent telecom operators, which ultimately affects their bottom lines. For example, Netia's earnings in 2002 were only 4% of TPSA's total fixed-line earnings. If Netia were able to win over just 2% of TPSA's earnings within the next two years, it would increase its income from €195.6 million (zł. 604.4 million) to €207.8 million (zł. 900 million), the BRE Bank analysts said.
The gradual introduction of new European Union regulations on the telecom market, however, will create a more level playing field for alternative operators like Netia. As a result, analysts forecast that TPSA will lose fixed-line market share after the country joins the EU.
TPSA reported sales of €4.15 billion (zł. 18 billion) last year, up from €4 billion (zł. 17.331 billion) in 2001. BOŚ brokerage analysts are optimistic about TPSA's financial results this year, saying that its reduction of employment costs as a result of last year's restructuring should have a positive impact on results in 2003.
Investors, however, seem to be discouraged by the treasury ministry's plan to give 46 million TPSA shares to Kompania Węglowa, the coal holding company. Likewise, analysts say the give-away is a risky move which could result in a large supply of shares on the stock market in the short term and thus drive down the share price.
Pekao brokerage maintains its "over the market" recommendation on TPSA, saying that the treasury ministry's decisions regarding the share give-away will have an impact on the company's share price this year, as will potential decisions by Kompania Węglowa.
Analysts at Bank Pekao brokerage forecast that TPSA will end this year with a €397.4 million (zł. 1.721 billion) net profit on sales of €4.32 billion (zł. 18.711 billion). At the same time, Millennium brokerage predicts that TPSA's net profit will increase to €303 million (zł. 1.312 billion) this year from €94 million (zł. 840 million) in 2002. Michał Buczyński, telecoms analyst at Millennium bank, forecasts that TPSA's deep restructuring, especially its continued employee layoffs, as well as the improving performance of PTK Centertel, TPSA's mobile operator, will boost its operational profit, Ebitda and net profit.
Netia reported sales of €195.6 million (zł. 604.4 million) for 2002, up from €124.45 million (zł. 538.9 million) in 2001. It finished last year with a €155.88 million (zł. 675 million) net loss, a decrease from a €265.6 million (zł. 1.15 billion) net loss the previous year. So far this year, Netia has already converted most of its €850 million debt into shares. On February 13, the company issued 312 million new shares, quoted as Netia2.
Analysts at CA IB are forecasting a growing demand for Netia's shares after it replaced household appliances maker Amica on the WIG 20. They believe that national pension funds may absorb 17% of the firm's shares.
Analysts also believe that Netia may become an acquisition target since it no longer has a major shareholder following the new share issue, which could boost its share price. Currently, there is an accumulation of shares being sold by Netia's former creditors.
BRE Bank brokerage puts Netia's sales at around €151.7 million (zł. 656.9 million) this year with a net loss of €21.9 million (zł. 94.8 million). The company should see a net profit of €2.42 million (zł. 10.5 million) in 2005.
In addition, BRE Bank brokerage analysts criticise the country's telecommunications law for its imprecision and loopholes, which allow TPSA to retain its stronghold on the fixed-line telecom market. They consider the law's stipulations to be very unfavourable for independent telecom operators, which ultimately affects their bottom lines. For example, Netia's earnings in 2002 were only 4% of TPSA's total fixed-line earnings. If Netia were able to win over just 2% of TPSA's earnings within the next two years, it would increase its income from €195.6 million (zł. 604.4 million) to €207.8 million (zł. 900 million), the BRE Bank analysts said.
The gradual introduction of new European Union regulations on the telecom market, however, will create a more level playing field for alternative operators like Netia. As a result, analysts forecast that TPSA will lose fixed-line market share after the country joins the EU.
