The combined profits of the listed companies on the Cyprus Stock Exchange (CSE) reporting their results for the January-March period showed an 18.5% year-on-year decline in profits, which, according to Financial Mirror records, is the first drop in earnings since 2005 when the recovery in equity prices started in earnest.
Total first quarter profits reported by CSE listed companies amounted to EUR 243.75 mln, down 18.5% YoY compared to EUR 298.96 mln reported in the first quarter of 2007, the Financial Mirror data showed.
At this rate, and based on the first quarter results, there is a good possibility that the CSE listed companies will show a decline in profits compared to the previous year, when total profits reached EUR 1.7 bln.
This may help explain why the stock market has already marked CSE prices by average 37% lower since the start of the year.
Main Market
The 13 component stocks listed in the CSE’s Main Market, which are required by law to announce their first quarter results reported a 16.2% decline in profits to EUR 245.5 mln from EUR 292.9 mln in 1Q07.
Among the majors, Marfin Popular Bank takes most of the blame for the decline since its profits fell 38% to EUR 104.4 mln, while the profits of Hellenic Bank were 5.6% lower at EUR 22.9 mln.
MPB has warned that its 2008 profit will range between EUR 500-600 mln from EUR 617 mln reported in 2007, while HB has also issued a negative warning and forecasts 2008 profits to drop by 15% to EUR 113 mln.
Bank of Cyprus on the other hand lifted its 1Q08 profit by 9.3% to EUR 116.05 mln in line with its forecast of lifting total 2008 profits by 11% to EUR 540 mln.
In percentage terms, the best performance was reported by Aspis Holdings, increasing its profit by 207% to EUR 7 mln from EUR 2.2 mln a year ago. Despite the exceptionally positive performance however, ASP has forecast that its total 2008 profit will increase by 17% to EUR 30 mln.
The second best performance was delivered by SFS Group, which lifted first quarter profits by 180% to EUR 6.6 mln, mostly on the back of ship disposals. Similar to Aspis, for the full year SFS is predicting a moderate 2% increase in profit to EUR 31 mln.
Not all bad
In the Parallel Market, the three reporting companies, Ermes Departments Stores, Woolworth (Cyprus) Properties and Laiki Investments reported combined losses amounting to EUR 1.1 mln compared to a profit of EUR 5 mln reported in 1Q07.
In the Alternative Market, Cyprus Trading Corporation reported a similar deterioration in results, as its 1Q07 profit of EUR 1 mln turned into a 1Q08 loss of EUR 646,000. CTC blamed a big share of the loss on the dismal performance of Ermes and Woolworth.
Nevertheless, CTC revealed that it expects its final 2008 profits to be better than the EUR 13.8 mln reported for 2007, which means a substantial improvement is also to be expected from Ermes and Woolworth.
Meanwhile, the results of three investment companies showed a massive deterioration in their performance, in tandem with the massive decline in equity prices both in Cyprus as well as in Greece where most of the investments have been made.
Cytrustees Investments showed a loss of EUR 24.1 mln for the first quarter compared to a profit of EUR 4.4 mln a year ago in the same period. Interfund reported a loss of EUR 31.8 mln vs. a profit of EUR 388,000 a year ago and Athena Inv. reported a loss of EUR 9.4 mln compared to a profit of EUR 2 mln reported a year ago in the same period.
Cytrustees and Interfund are majority owned by BOC, while Athena is majority owned by HB.
