International Property News

ECM REI makes loss of CZK 555m in Jan-Sept

27th November 2008

The developer ECM Real Estate Investments (ECM REI) recorded a loss of EUR22.15m (about Kc555m) in the first three quarters of this year, according to consolidated unaudited results, the company said in a press release Wednesday.

In the same period last year ECM posted net profit worth EUR4.43m.

The loss is slightly above analysts' estimations.

ECM REI shares are traded on the Prague Stock Exchange (BCPP).

The company's administrative costs increased by 61 percent to EUR11.1m year-on-year, mainly in connection with business expansion in Russia, China and Poland as well as due to ongoing domestic projects.

ECM REI's net lease income, on the contrary, increased by 32 percent to EUR8.4m, with City Tower, City Empirium and CCS headquarters in Prague, Varenska building in Ostrava, north Moravia, and hotel Diplomat in Plzen, west Bohemia, the biggest contributors.

Despite the current crisis on global markets ECM REI still plans to sell the projects it has completed as advantageously as possible, financial vice-president Kamil Ziegler said. The company wants to continue operating on the emerging markets, including the Czech Republic and China, he added.

Milan Janku, ECM founder,chairman of the board of directors and the main shareholder via the ECM Group, made a voluntary takeover bid to other shareholders at the end of October, offering Kc303 per share.

Last week Janku confirmed he wanted to take part in a non-public issue of 2 million new shares, which ECM REI plans to issue before the year's end. He could thus become majority owner. At present he controls slightly over 30 percent of ECM.

Wednesday, no trade with ECM shares took place in the blue-chip SPAD system on the BCPP and the title closed at Kc289.20 per share.

ECM REI's portfolio consisted of 13 developer and 9 investment projects with total area of over 518,000 square metres at end-September.

Source: Prague Monitor