CEZ held a conference call to the IFRS 9M2004 results yesterday. The company said that despite an electricity consumption growth of 3.1% y/y in 9M the growth going forward should be between 1.5 – 2.0% p.a. Dividends are to increase linearly from the current CZK 8 per share to CZK 12 per share in 2006/2007. CEZ expects acquisitions in Romania to stand at 60% of the Bulgarian investments (cCZK9.0 bn), i.e. CZK 5.4 bn. CEZ plans to use some external capital next year to improve its leverage. Its target D/E by 2010 should be around 0.3 as investments into replacement of about 5 thousand MW of capacities are expected to be at around CZK 150 bn onwards. As a result, CEZ’s acquisition capacity is about EUR 3 bn (combination of own cash and external leverage), nevertheless, it does not expect it to use it all. We believe the comments are mostly in line with market perception of the current situation and future development.
Tomáš Gatěk, Patria Finance