Engineering company SES Tlmace, producing heavy equipment for energy sector, said its profit will probably remain on an upward trend in 1998, but added that it will still not be able to pay any dividend due to a need to cover losses from previous years.
SES Tlmace, whose shares have just started trading on the main listed floor of the Bratislava Stock Exchange, said it expected to post a pre-tax profit of around 111 million Sk ($3 million) for 1998, compared with a gross profit of 87.6 million Sk in 1997. The company posted an unconsolidated pre-tax profit of 76.8 million crowns in the first seven months of this year.
"Although we will probably meet the planned profit of around 111 million Sk, we will not pay any dividend since the funds will be used to redeem losses from previous periods," SES financial director Pavol Bobok said. "The earliest that we may be able to pay dividends could be on profits from 1999," Bobok added. The company, which now has around 4,300 employees, posted a 431 million Sk loss in 1996 after a loss of 659 million Sk a year ago.
SES Tlmace has become one of Slovakia's most open companies in terms of information standards, as bad financial discipline among its domestic customers forced it to find its own way to secure financial sources to cover its contracts. SES has recently successfully issued two bond issues on the local capital market, totalling 300 million and 200 million Sk respectively.
Although the company's main project is now completion of a water power station in Vojany, eastern Slovakia, SES exports around 60 to 70% of its production, focusing mainly on markets in the Czech Republic, Hungary and Poland. "We now have a contract at a power station in Cuba, worth around 16 million dollars, which we consider a smaller project," SES General Director Stefan Izold said.
SES shares closed at 250 Sk on September 9. The company's overall market capitalization is 391 million Sk at present. Its main shareholder is the management-led company SES Trading with a 29.88%. Other shareholders are unknown, as only depositors of the holdings - such as ING Barings or Royal Trust Corporation of Canada - were made public.