VILNIUS - Lithuania's largest dairy producer, Rokiskio Suris, announced on Aug. 6 that consolidated sales over the first seven months of the year soared 33 percent to 372 million litas (108 million euros), significantly higher than the company's original projections.
Rokiskio Suris, a blue-chip company based in northern Lithuania, also said that sales in July alone surpassed last year's result by 42 percent and amounted to nearly 60 million litas.
The company has forecast that earnings for 2007 would double to 25.6 million litas, while annual sales would grow 16.1 percent.
Company executives are decidedly bullish about their future, as evidenced by an announcement last month that the company has bought back 78,400 's or 1.83 percent 's of its outstanding shares on the open market.
Rokiskio Suris had formed a 20 million litas reserve for the share buy-back plan, and the purchase of the 1.83 percent cost the company 4.7 million litas, the company announced in July.
In 2006 the company also bought back 1.73 percent of its own stock, according to its annual report for 2006, which also stated that as of Dec. 31, 2006 the company owned 10 percent of its own shares.
Orion Securities, a Norwegian investment bank, recently projected that the dairy's annual sales would grow 17.8 percent to 610 million litas and earnings would soar 84 percent to 23 million litas. The firm has placed a buy recommendation on the stock.
Meanwhile, the company is bracing itself for a rise in prices and the recent decision by the European Commission to cut subsidies for dairy exports to non-EU members.
CEO Antanas Trumpa said that the company would have to wait until 2008 before raising its prices since long-term contracts for the dairy's products and milk purchases could not be changed.
"Our losses will equal the amount of subsidies we used to receive," Trumpa was quoted as saying, adding that the dairy used to receive 200 euros for every ton of cheese exported. Given that the company exports approximately 5,000 tons in a six-month period, total losses from the cancellation of the subsidy would amount to 1 million euros.
Last year Rokiskio Suris produced 28,000 tons of fermented cheese, up 12.8 percent from 2005.