Ceske radiokomunikace’s AGM, which meets today at 10 am CET, has only one issue on its agenda - the parent company’s subscription of new RadioMobil stock worth CZK 1.18 bil. RadioMobil needs to raise equity (and debt) in order to finance its CZK 11 bil. capital expenditure this year. The parent company must subscribe the new RadioMobil stock if it wants to avoid a further dilution below the current 39% stake, which makes a decision to subscribe very likely.
Separately, Reuters yesterday reported RadioMobil’s 2001 earnings outlook, as presented by the parent company, and we find the figures rather disappointing. RadioMobil expects some 19% revenue growth, to CZK 21 bil. (marginally below our forecast), and a decline in net income to CZK 1 bil. (vs. CZK 1.7 bil. in 2000), which is in contrast to our projections of a modest profit growth this year. Given that the 39% stake in RadioMobil still represents the single-largest component of CRa’s value, the stock is vulnerable to further decline (particularly given that a district court is to rule Monday on the contested validity of CRa’s April AGM, and, thus, on the AGM approved dividend payment).
(Ondřej Daťka)