On the occasion of announcement of the financial results for fiscal year 2008, MICHANIKI Group states the results' main points:
On a Group level, the consolidated Turnover (Sales) for 2008 amounted to euro 230,94 million, against euro 226,14 million of the respective year of 2007, an increase by 2,12%. EBITDA amounted to euro 80,45 million versus euro 78,80 million, depicting an increase by 2,1%. Income before taxes amounted to euro 45,29 million, lower by 36,76% due to the significant effect of the payable loan's interest and the increased financial expenses. Net Income after tax amounted to euro 27,87 million versus euro 53,51 million in 2007. The Net Income payable to equity shareholders of the parent company is euro 21.96 million, lower by 50,40% and the Earnings per share derives to euro 0,2378 per share versus euro 0,5094 of 2007.
On a parent company level, Turnover (Sales) increased by 24,51% achieving sales of euro 181,31 million against euro 145,62 million in 2007. EBITDA amounted to euro 35,79 million, depicting an increase by 47,37% which is due to the increase of sales by euro 35,69 million. Income before tax amounted to euro 8,87 million, depicting a decrease of 71,40% due to the significant effect of the loan interest payments and the increased financial expenses (an increase by euro 20,51 million). Net Income after tax amounted to euro 2,26 million against euro 24,77 million in 2007, decreased of 90,89%; and the Earnings per share derives to euro 0,0245 per share versus euro 0,2677 of 2007.
The Group's Gross Profit Margin against the Total Turnover (Sales) remained at a satisfactory level for 2008 and came up to 22% from 17,3% (2007). Gross profits increased by 30% at euro 50,85 million against euro 39,13 million of the respective year-end of 2007 due to the decrease of the cost of raw materials during the last two quarters which positively affected the cost of sales.
On a Company level the Gross Profit Margin against the Total Turnover (Sales) came up to 21,8% from 19,4% in 2007 (gross profit euro 39,59 million vs. euro 28,20 million), an increase of 40,4%.
The decreased profits of the Group and the parent company are caused mainly due to (a) the decrease of financial income, (b) the increase of financial expenses (increase of loan interest rates during the last three quarters of 2008), (c) losses due to derivatives products and contracts; and (d) due to the international economic recession of countries abroad that has as a result the reduction of activities and financial results of the subsidiary companies.
The Group today operates and has under construction 25 infrastructure projects in the whole area of Greece and will participate in biddings that will be held by the State and which will involve projects whose financing is assessed from the 4th Community Support Framework. The remaining balance of the un-executed contracts of Michaniki SA and its subsidiary company THOLOS at the end of 2008 amounted to euro 260,19 million. (Michaniki : euro 223,36 million, Tholos : euro 36,82 million).
Michaniki management focuses on the continuous development and exportation of Greek entrepreneurship to promising foreign markets, such as Ukraine's, Russia's, Bulgaria's and Egypt's. The usage and economical development of real estate plots, owned or leased, is the area of concentration that the Group gives great emphasis, based on the general orientation of the schemes "construction-financing-utilization" from international real estate development companies and joint ventures schemes.
Apart domestic construction projects, abroad Michaniki is proceeding with an intensive rate a) the construction of the building complex "Alexander the great" of a total area of 166.000 sq.m. in Moscow, b) the construction of the building complex "Artemis" of a total area of 53.000 sq.m in the eastern suburbs of the town of Kiev, and c) the construction of the building complex "Hera" of a total area of 15.000 sq.m. in Moscow. Michaniki portfolio's Net Asset Value (NAV) abroad, appraised by the international real estate valuators of Cushman & Wakefield (Russia, Ukraine, and Bulgaria) and CBRE (Egypt) as of December 2008 is euro 496,55 million versus euro 513,03 million in 2007 (down by 3.21%).
The prospects for 2009 are expected to be affected from the deceleration of the global financial development and the obvious dissociation of developed and mature markets. Even though emerging markets may continue their development in lower paces, the opinion that seems to prevail foresees the correction possibility of the U.S. market and the deceleration of the economy in Europe for the whole year of 2009. Under these hard and unstable circumstances it is hard to make any precise forecast regarding the real estate markets abroad and domestically for 2009. The management of Michaniki S.A. will continue on slower pace with carefulness its long term investment plan and strategy, focusing in the increment of the Greek non executed portfolio/contracts, in the continuation of the in progress construction projects locally and internationally taking advantage of the decrease of the prices in expendable supplies, and proceeding with caution on the management of capital reserves.
The Company's Management, intends to suggest to the General Assembly of its shareholders for 2008, the distribution of a dividend amounting to euro 0,09 per share which after the proportion of the dividend that is proportionate to the own shares, amounts to euro 0,09057 per share, of which dividend after the tax retaining obligation for dividends of 10% in favour of the Greek State (par. 1, article 18, l. 3697/2008) the remaining dividend amounts to euro 0,081513 net per share, with the dividend yield stand at 5.90% on a yearly basis.
The publication and analytical information with regards to the company's financial results can be found in the Company's website www.michaniki.gr on Friday 27th of March 2009.