Warsaw (Puls Biznesu) – Agora media group disappointed with its quarterly results. Investors started selling the stock in reaction.
In the first quarter of 2006, Agora had PLN 0.8m (EUR 0.206m) of consolidated net income, down from PLN 43.3m a year before. The average estimate of the analysts polled by PAP agency amounted to PLN 9.7m. The operating income fell to PLN 3.3m from PLN 52m in the first quarter of 2005 and was PLN 8m lower than the market expectations. Sales amounted to PLN 295.1m, the level forecast by analysts. The company explained weak first quarter results with the operating loss generated by “Nowy Dzien” daily, which amounted to PLN 21.5m, motivation programs worth PLN 10.7m and worse period in the advertisement market.
Agora said it would possibly buy back its shares for PLN 86m. It also said that the sales of “Gazeta Wyborcza” daily grew to 500,000 issues in March. The stock was falling even 7 percent during the day to PLN 44.9 a share.
“This is going to be a difficult year for Agora. Results will be worse than expected due to high costs of defending the market”, Michal Marczak, DI BRE Bank analyst commented.
Agora had planned before to spend PLN 60-70m for marketing. Yesterday, Wanda Rapaczynka, the company’s CEO said it would be 30 percent more but analysts estimate it may be even more. Axel Springer is going to spend PLN 100m to promote its new daily “Dziennik”.
(PLN 1 = EUR 0.258)