Romania's real GDP expanded by 0.2% qoq in 4Q 2012, above market consensus
Romania’s real GDP expanded by 0.2% qoq seasonally adjusted in 4Q 2012, above the market consensus, which was expecting a marginal contraction (-0.1%). This was only a flash estimate, while detailed GDP data will be announced on 6 March. During 2012, economic activity expanded by merely 0.2% as a poor agricultural output took its toll on economic activity. This comes after 2.2% growth in 2011.
Transelectrica - 2012 results close to expectations (neutral)
Transelectrica reported its preliminary 2012 IFRS results, stand-alone. The figures are thus not fully comparable with the quarterly results prepared according to local standards or with our figures. We computed the 4Q results by deducting the 1-3Q results under local standards from the reported 2012 figures.
Quantities transported for the quarter reached 13.8 TWh, 2.7% lower yoy and 1.4% higher than our estimate. Costs were not adjusted for the drop in quantities so the operating profit was negative at RON 14.4 mn. Some of the losses recorded at the end of 3Q from the revaluation of the FX denominated debt reversed due to RON appreciation over 4Q. Overall the company recorded a minor net profit of RON 7.8 mn.
Over 2012, quantities transported dropped by 3.8% yoy and the net profit stand-alone under IFRS reached RON 27 mn, compared with RON 114 mn in 2011.
We had adjusted our estimates to include RON 56.3 mn revenues and net profit recognised in 1H under IFRIC 18 from the commissioned investments for connection to the grid subsidized by third parties. However, the company did not apply this policy and will recognize these revenues over the life of the asset (similar to the policy applied so far under Romanian Accounting Standards). This distorts the comparison to our estimates. If we take out the RON 56 mn the results are relatively close to our expectations. So we see the results as neutral.
It is not clear at the moment what would be the profit used for the payment of dividends, but if it will be the presented profit, using the dividend pay-out ratio of 85% required by the state, the dividend would come close to RON 0.313, providing a dividend yield of 2.2%. Other options would be to use the consolidated results or the figures prepared for fiscal authorities, but we do not expect large discrepancies.
Banca Carpatica’s 4Q 12 net profit surging
Banca Carpatica’s (BCC) assets have increased 10% qoq in 4Q 12 to RON 4.7 bn, driven by a 15% qoq jump in AFS portfolio while net loans contracted 3% qoq. Securities portfolio has now a weight of 55% in total balance sheet. As 2012 was the first year when quarterly figures are reported under IFRS, BCC has not published the 2011 quarterly results under IFRS and therefore, we are not able to comment on the quarterly evolution. NII for FY 2012 stood at RON 84.6 mn, up 30% yoy, driven by interest revenues from T-bills portfolio. NIM for the year seems very low at 2.2%. Annual F&C amounted to RON 36.3 mn, up 35% yoy while trading and gains from AFS portfolio amounted to RON 92 mn, up 42% yoy. Non-interest expenses jumped 35% yoy to RON 152 mn, driven by salaries and general expenses and C/I ratio remains constant at around 71%. Provision charges came in at RON 49 mn, 62% yoy higher, implying a risk cost of around 420 bps. Net profit for the year stood at RON 25 mn, swinging from a loss of RON 32 mn, a year ago. Net profit for the quarter stood at RON 12 mn.
Electroarges – good top line performance, bottom line helped by special financial gains
The producer of home appliances Electroarges (ELGS) has reported a 5% yoy growth in its quarterly turnover to RON 32.7 mn, continuing to rely on its traditional business partner, Karcher. Elevated raw materials expenses (+34% yoy to RON 24 mn), eroded EBIT to RON 1.8 mn, down 22% yoy. Higher financial gains (RON 2.7 mn vs. minor financial losses during 4Q 11), most probably from the revaluation of the listed shares portfolio held in other companies helped the bottom line. Thus, ELGS reported for 4Q 12 a net profit of RON 3.8 mn, more than double yoy.
Over 2012, sales advanced by 10% yoy to RON 138 mn, while EBIT increased by 31% yoy to RON 12 mn, given a tight costs control. Bottom line stood at RON 13 mn, up 78% yoy, positively influenced by the aforementioned special financial gains.
Impact Developer&Contractor reports weak 2012 results
The real estate developer Impact Developer&Contractor (IMP) reported its 2012 preliminary figures under IFRS, reported until now only under RAS. We do not have comparable quarterly figures so we focus on the annual comparison. Turnover increased in 2012 to RON 22 mn, up 3x yoy fuelled by the sale of several houses from stock, which were already included in the P&L in production realized and capitalized. Moreover, it seems that the sales were done at cost value.
The company registered losses from the effects of IAS 40 (which applies to the accounting of property held for rental or capital appreciation) amounting to RON 11 mn during 2012 vs. losses of RON 34 mn during 2011. EBIT for 2012 remained in red at RON 37 mn from a loss of RON 48 mn during 2011. Net result was a loss of RON 39 mn vs. a loss of RON 45 mn during 2011. We remind that under RAS, IMP reported a net loss of RON 16 mn for 1-3Q 12, thus we view these results as negative
