SFS Group forecasts EUR 17mln 2007 profit

SFS Group Pcl (SFS), the most widely traded stock on the CSE relative to its market cap is forecasting CYP 10 mln or EUR 17.2 mln in net profit for 2007 following a highly successful 2006, which saw an expansion of business and profits from all main areas of activity, said SFS Chairman Christodoulos Ellinas.

Speaking at the Group’s Annual General Meeting, Ellinas said net profit in 2006 jumped sharply to EUR 13.9 mln from EUR 4.6 mln in 2005 and “is on track to reach EUR 17.2 mln for 2007.”

According to Financial Mirror calculations, SFS shares now trading around EUR 1.70 per share are trading at a 2007 price to earnings (p/e) ratio of 5 times, the lowest among CSE Main Market stocks.

Shareholders approved a Board proposal for the payment of 3 cent or EUR 5 cent final dividend, with the ex-dividend date fixed for 25 May and the payment date for 25 June, 2007.

“Our objective is to distribute a minimum of 30% of our profits in dividend,” said Ellinas adding that the SFS Group wants to maintain leadership roles in all core areas of activities, expand its financial services in Greece, Balkans and the Middle East and boost its shipping activities and target property investments in emerging east European countries.

SFS Group aims to maintain revenue growth rates of over 20% per annum during the next 3 years, contain fixed overhead growth below inflation rate plus 3%, sustain minimum ROE Group of 20% and increase third party funds under management.

SFS Group wants to reduce debt at Group level by at least EUR 15 mln per annum over next 3 years, replace bank debt with own asset backed bonds and partly replace capital growth assets with income generating assets.

The objective is to unlock shareholder value, increase the dividend pay out ratio and proceed with the sell-off and listing of distinct sub-holding groups such as Shipping and Property.