(Adds buyback, updates share price)
By Jan Korselt
PRAGUE, Feb 25 (Reuters) - Fourth quarter net profit at
Czech power firm CEZ <> nearly doubled from a year
earlier to 12.63 billion crowns ($744.2 million) due to higher
output, prices and one-off gains, the company said on Monday.
The net result at the biggest Czech company, with a market
capitalisation of $43 billion, lagged expectations of 13.23
billion crown profit excluding minorities, based on the average
estimate in a Reuters poll of 10 analysts.
The figure was boosted by a one-off gain of more than 3
billion crowns from deferred tax following a government tax cut,
and 2.9 billion crowns accounting income from revaluation of
electricity supplied to clients but not yet invoiced.
CEZ benefited from rising electricity prices and demand in
central and eastern Europe, which raised output by 10 percent
year-on-year in the last quarter of 2007.
"The net profit lagged expectations due to lower currency
gains -- the positive effect of appreciation of the Czech crown
to the euro was almost compensated for by costs of hedging bonds
-- and due to higher-than-expected other financial expenses,"
said Petr Novak, analyst at local brokerage Atlantik FT.
"(Overall) the results did not bring any surprise, therefore
we expect trading with CEZ shares will be driven by the overall
market sentiment," Novak added.
The stock rose by 0.74 percent to 1232 crowns by 1155 GMT,
lagging the Prague bourse's PX index <>, which added 1.7
percent.
Revenues rose 26 percent to 51.07 billion crowns, above the
average market estimate of 50.79 billion.
Earnings before interest, tax, depreciation and amortisation
(EBITDA) rose 26 percent to 20.19 billion, also beating the
average forecast.
Full-year net profit jumped 48.7 percent to 42.76 billion
crowns including minority interests, slightly above the
company's December forecast of 42.6 billion.
CEZ reiterated its full-year 2008 forecast for a 46.6
billion crown net profit including minorities and 85.5 percent
billion crowns.
BUYBACKS
The 66 percent state-owned CEZ has been buying its own
shares since last April and has so far drained an 8.64 percent
stake from the market, against the approved amount of 10
percent.
The buyback has helped to push the stock up 37 percent over
the last year, while the Czech stock market fell almost 10
percent in the same period.
Chief Executive Martin Roman told a news conference the firm
could repeat the buyback programme this year if it does not find
enough acquisition opportunities.
"I think that it could be a legitimate possibility ... It
does not have to be necessarily 10 percent, we can start with
the process and flexibly react according to how successful we
will be in our acquisition policy," Roman said.
The cash-rich company has been bidding for production and
distribution assets in Romania, Bulgaria, Russia, Turkey and
elsewhere in central and eastern Europe.
Roman added that CEZ would most probably cancel the shares
acquired in the ongoing buyback scheme.
CEZ also confirmed it planned to pay 50-60 percent of last
year's net profit including minorities in dividends, adjusted
for some of the one-off gains.
(Reporting by Jan Korselt; Editing by Rory Channing)
