EARNINGS POLL-Czech Zentiva Q1 net profit seen up 10.7 pct

...million) 
     
    By Jan Korselt 
    Czech drugmaker Zentiva 
 is expected to post an 11 percent rise in 
first-quarter net profit compared with a weak quarter a year 
ago, helped by continuing expansion abroad, a Reuters poll 
showed on Thursday. 
    Nine analysts in the survey gave an average net profit 
forecast of 565 million crowns, up from 511 million in the first 
quarter of 2006. Revenues are expected to have risen by 14 
percent to 3.62 billion crowns. 
    "The first quarter of 2006 was particularly weak for Zentiva 
due to falling Czech sales caused by new regulations on drug 
prescriptions," said Lukas Dufek, an analyst at Komercni Banka. 
    "The first quarter of 2007 will thus show solid growth 
dynamics, supported also by the continued expansion on Zentiva's 
other markets," he added. 
    In the first quarter last year, revenues in the company's 
key Czech market fell by 16 percent after the former leftist 
government introduced limits on drug prescriptions. 
    Zentiva then also booked one-off costs, worth 76 million 
crowns on the operating profit level, due to integration of 
Romanian generic drugmaker Sicomed . 
    On the other hand, this year's results will be burdened by 
higher marketing costs to introduce new products and expand to 
new markets, analysts said. They expected the EBITDA margin to 
shrink by 1 percentage point to 29.8 percent. 
    Zentiva, the leading central European generic drugmaker, has 
been expanding throughout the region. Its biggest markets are the 
Czech Republic, Romania, Poland and Slovakia, but the company is 
also looking for growth in the former Soviet Union or the 
Balkans. 
    France's Sanofi-Aventis  is the firm's largest 
shareholder with a 24.9 percent stake. 
    The stock has jumped by one fifth since 2006 results 
released at the beginning of March, when the firm announced 
acquisition of 75 percent in Turkish drugmaker Eczacibasi 
Generic Pharmaceuticals for 460 million euros ($622.7 million). 
    Zentiva trades at almost 21 times forecast 2007 profits, 
according to Reuters Estimates, compared with nearly 17 times 
for the DJ Stoxx health sector index . 
    Following is a breakdown of analysts' forecasts for 
Zentiva's Q1 2007 results. 
 
 Figures in CZK bln    Average   Median    Q1 2006      Range 
 SALES                  3.615     3.550     3.176    3.471-3.817 
 EBITDA                 1.087     1.090     0.979    0.995-1.181 
 OPER.PROFIT (EBIT)     0.838     0.818     0.760    0.746-0.971 
 NET PROFIT             0.565     0.560     0.511    0.496-0.679 
    The following equity houses took part in the poll: Atlantik 
FT, BH Securities, Cyrrus, Deutsche Bank, Erste Bank, Komercni 
Banka, KBC/Patria Finance, UBS and Wood & Company. 
    All 9 analysts provided forecasts for sales, EBIT and net 
profit, but only 7 of them gave EBITDA estimates. 
  
 ($1=20.85 Czech Crown) 
 ($1=.7387 Euro) 
  Keywords: ZENTIVA RESULTS/  
    

[PRAGUE/Reuters/Finance.cz]