By Nicolas Bornozis
Market News
Greek stocks increased this week by 0.79 % closing at 2187.24 points, a small increase for the first week for December. The market gradually and slowly seems to overcome the fear after the terrorists attacks. The FTSE/ASE 20 Index increased by 0.55% closing at 1104.39 while the FTSE/ASE 40 rose 0.84 %, ending the week at 234.45 points. The FTSEASE small cap 80 Index increased this week by 3.12% closing on Friday at 604.36 points.

Economic News

The revised stability pact submitted by the Greek Government to the EU Commission makes provisions for the gradual decrease of corporate tax rates. The tax rate is to be reduced by 1 % p.a. for five years to 30 % from the current 35 %. The government expects the strengthening of the Greek Businesses’ competiteveness by this move. Additionaly, the pact forecasts short-term interest rates to be flat next year at 2.3% and for 2004-2005 the interest rates are expected to hike to 3.2 % – 3.3
% respectively. The estimates for long-term rates are calling for gradual increase until 2006. The jump in interest rates is expected to take its toll in the struggle of the Greek government to reduce public debt.

According to the Ministry of Finance, public investment expenditures reached 7.3 billion in January-November 2003, 30 % higher than the same period last year. Total public investment budget for fiscal year 2003 calls for 8.6 billion euros. The state’s contribution reached 95 % of the yearly target.

The state is expected to complete the sale of a 35 % equity stake in the state-owned Natural Gas company to Spanish peer, “Gas Natural” for 250 million euros in early 2004.

The state revenues from the stock market transactions for the 11-month period January to October 2003 reached 95 million euros, an increase of 40 %. The initial target for this perios was 113.93 million euros, while for 2004 the government has set a more conservative goal at 110 million euros.

According to OECD, Greece is included among the 5 OECD countries with annual GDP growth rates that exceed 4%. Growth is attributed to low interest rates, investments for the 2004 Olympics and partly EU funded infastructure works. A similar pattern with Greek growth rates exceeding OECD average is expected to continue at least until 2005.

The ministry of finance is proceeding to a revision of the third EU Framework scheme entailing redistribution of the current funds as well as distribution of an extra 1.3 billion euros reserve fund during this week.

Corporate News

MOTOR OIL HELLAS S.A.

MOTOR OIL (HELLAS) CORINTH REFINERIES S.A announced that, following the decision of the Extraordinary General Shareholders Meeting of February 19th, 2003 regarding Buy Back of its own shares, during the period September 1st, 2003 – November 30th, 2003 which was defined by the BoD in its meeting of August 21st, 2003, the Company acquired 55,530 common registered shares at an average purchase price of Euro 6.84 per share. Total number of own shares in possession of the Company equals 205,890 (average purchase price Euro 6.73 per share) representing a percentage of 0.1858 % of its share capital.

COCA COLA HBC

Coca-Cola Hellenic Bottling Company S.A., announced on Friday 5th December the completion of its acquisition of the Austrian mineral water company Römerquelle GmbH. The acquisition involves production facilities at Edelstal and Pöttsching and the mineral water and wellness brands Römerquelle and Markusquelle. Doros Constantinou, Managing director of CCHBC, commented: “This acquisition is a significant further commitment to our operations in Austria. Römerquelle and Markusquelle have great potential for continued growth in the rapidly expanding bottled water and wellness drinks segments. The addition of this quality water brand is an excellent example of CCHBC’s strategy to broaden the selection of non-alcoholic beverages that we offer to our consumers.”

PC SYSTEMS

PC SYSTEMS Group, subsidiary of the POULIADIS GROUP, announced that during the first nine-month period of 2003, its turnover amounted to 34.3 million Euros versus 35.9 million in the respective period last year, while the group’s profitability recorded significant growth. Specifically, consolidated pre-tax profits, after subtracting minority rights, amounted to 338.3 thousand Euros versus 126.8 thousand in the nine-month period of 2002. This impressive increase in the profits of PC SYSTEMS is attributed to the its participation in significant IT projects implemented in Greece, in the Private and Public Sector, as well as to the continuous expansion of its services, which rank the company amongst the key players in the sector of integrated IT Solutions in Greece.

BABIS VOVOS INTERNATIONAL CONSTRUCTION S.A.

BABIS VOVOS S.A. revenues from sales noted a decrease of 10.35% and reached Euro 84.14 million. Profits before taxes declined by 21.10% and reached the amount of Euro 23.7 million versus the corresponding period of 2002. This decrease is attributed to the decline by 16.9% in profits from development and real estate sales. On the contrary, revenues from leases recorded an increase of 15%. The Group’s annual figures for 2003 are expected to improve against the respective ones for 2002, since the financial results of the fourth quarter figures so far appear to be significantly increased compared to the corresponding period of the previous year.