25.10.2010

Nordic markets rose on average around half a percent to start the week. Eurozone industrial orders for August had been stronger than expected. There was also some uncertainty on Friday ahead of the G20 meeting. Jitters ahead of such things events tend to be to take some risk off the table in the event of the extraordinary happening coming out of it. No news was good news and the somewhat hollow rhetoric could be taken as the explaining thing for the relief felt during early hours of trading. The full fledged currency war and trade war likelihoods were considered somewhat lessened in the aftermath. Europe also threw a bone (or had to give in, however you want to spin it) for emerging economies, given up some seats in the IMF. In today’s news, India’s central bank raised rates to 8.5%.


TeliaSonera reported improving growth and record earnings (EBITDA highest to date at 9,776 Billion SEK at a margin of 36.5%). The company raised its full year sales estimate. Q3 sales were down slightly. President and CEO Lars Nyberg told the press that growth coming from many parts within the group is very encouraging. He also said that smartphones are boosting mobile data revenues and equipment sales in the Nordic region. He also continues to believe, that the switch toward fibre optic networks are a long term differentiation competitive advantage, which justifies to short term difficulties and required CAPEX. The estimated CAPEX to sales was anyhow also revised slightly lower for the year. The stock responded favourably to the report and ended the day up over 1.5%.

Despite the aforementioned result, Swedish markets were underperforming other Nordic indexes as heavy trucks and busses manufacturer Scania traded sharply lower after its Q3 report. The result before taxes was 3,352 Billion SEK, which was half a billion above analysts’ expectations. The company cited sharp growth in Brazil, widespread improvement in Asia and slow growth and low prices in Europe. Revenue and new orders were the big disappointments in the report, contributing to a 4,6% slash for the company’s valuation in the day’s trading. Other somewhat disappointing Q3 numbers in brief: ReadSoft result before taxes 5.6 million SEK,Byggmax 159 million SEK before taxes, Studsvik operating profit -9,1 million SEK.

STX Europe report the following on its website: ”STX Finland Oy and Viking Line ABP have signed a preliminary agreement for the construction of an environmentally friendly, new generation cruise ferry for Viking Line. The agreement includes an option for a sister ship. The ship price will be about 240 million euros, and will be built at Turku shipyard for delivery in the beginning of 2013.”. The agreement hinges on Finnish government’s ”environmental support” (this kind of things are not protectionist, at least if you ask us about them, there are exceptional circumstances when it is done by us and that can never be when someone else does it…). The plan is to have the new ship to be LNG powered. Viking Line is gaining some good PR in the social media for the decision and the stock was up 4,62% for the day.

Biotie Therapies is preparing to possibly tap into a credit line from Yorkville and the board used its authorization from April to issue some 17 million plus stocks to the company itself. Setbacks in early stage partnering deals as of late leave the company without any assured cash flow besides the aforementioned credit line. Biotech companies should typically de-risk as much as possible but regardless any such move is weighed in against the worst case scenario of potential negative news from the late stage project(s) (In Biotie’s case that is Nalmefene for alcohol addiction in late stage, partnered with Lundbeck) or that potential new partnering deal negotiations have come into a standstill. In normal case such a move would be prudent preparation for “the what if”- scenario, just the reputation of the type of financing as a last ditch bandage aid adds into the negative vibe.

Jyske Bank first 9 months of 2010 result reported at 601 million DKK, slightly below estimates. Credit losses and write-downs are still higher than desired but they do continue to drop. Overall the report was pretty much lacking any big negative surprises, so the market reaction was tentatively positive as well. The speculation is running that the mystery offer received by H+H international that I also mentioned on Friday is supposed to have come from German rival Xella.

Marimekko gave a positive profit warning. Teleste’s German subsidiary signed a contract for three years to continue to maintain and upgrade Kabel Deutchland’s networks. The contract is based on a previous two year contract and has an annual sales figure of around 5 million Euros. Finnair is facing yet another strike, this time from technical staff and had to cancel some flights.

Northern Logistic Property ASA extended its loan facility of (NLP or the Company) has exercised its option to extend a loan facility of SEK 3,55 Billion with Deutsche Pfandbriefbank.