Kalin Genchev: Billboard Applies For Class A Investor Certificate

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Kalin Genchev: Billboard Applies For Class A Investor Certificate

Profit.bg talked to Kalin Genchev, chairman of Billboard Jsc Board of Directors about the company's financial results in quarter one, its 2008 prognosis and development plans.

Mr. Genchev what are the company's results for quarter one, and how do they compare with the respective period last year?

This year quarter one sales revenues stand at 2.53 mln leva, financial revenues are at 11,000 leva and total revenue comes at 2.54 mln leva (1.29 mln euros).

Q1 profit amounts to 354,000 leva, which translates into a net 315,000 leva.

Consolidated net sales revenue is 46% up year on year reaching 5.64 mln leva (2.8 mln euros). The company is sustaining a steady growth rate in all areas of activity.

Consolidated profit for the period is 394,000 leva, which is also 46% up from Q1 2007.

The company is continuing to invest in new machines and equipment in order to boost production capacity and increase competitiveness. We expect those investments to have a positive impact on the financial results in the next quarters.

What can investors expect from Billboard this year?

This year we are planning to invest in new advertising facilities as part of our Metro Advertising infrastructure and in relation to the opening of 5 new stations of the subway. The investments will be made in cooperation with Motion Arts, a unit of the Billboard group.

The management is also planning the establishment of new in-store advertisement facilities. Investments here will be made via Instore Media, another unit of our business group.

We are also planning to invest in design and establishment of integrated informational management systems in the printing and advertising business via our subsidiary Nimiseft OOD.

We have allocated funds for personnel related costs, including training, courses for additional qualifications and specialization, as well as to the area of target marketing in view of promoting our new products with the help of our subsidiaries.

In the past three years in Bulgaria we saw a significant growth in the area of both standard and non-standard visual advertising. We are expecting this tendency to be preserved in the next 3 years.

What factors are your prognoses based on?

We think that the increase of production capacities by more than 40% each year will be sustained, which will have a positive effect on results.

We also expect to increase our advertising space in the country, to add more outdoors advertising facilities (billboards etc), to have more materials for POS advertising etc.

We must also note the growing number of events such as exhibitions and fairs, which increase demand for advertising materials. The number of advertising vehicles is also growing, as well as export to neighboring countries and the EU.

Billboard performed a very successful IPO raising nearly 11 mln leva (5.6 mln euros). What will you use the funds for?

As at 31 December 2007 a total of 8.37 million leva (4.2 mln euros) of the IPO proceeds has been absorbed in four directions. First, repaying debts to Piraeus Bank Bulgaria and Post Bank (a total of 5.61 mln leva), as well as for repaying leasing liabilities to HVB Leasing and IBT Leasing (a total of 1.17 mln leva).

1.48 mln leva was used to pay commercial liabilities. Billboard also gave a 110,000 leva loan to Dedrax OOD.

You recently announced the establishment of Hiitset EOOD. Can you tell us more about this new company?

In 2007 Billboard bought land plots in the town of Kostinbrod and we are currently in the process of consolidating the plots and redeveloping them into a sites suitable for the construction of a factory. Our task this year will be to prepare all necessary paperwork and to start the construction of the infrastructure.

The aim is to consolidate land in one 50 decare plot where we will build a printing factory with a total built-up area of round 28,000 sq.m, including a storage area, an administrative building, a truck parking etc.

The company established the subsidiary Hiitset EOOD for this purpose. The focus of this project is offset printing.

We have a applied with the Bulgarian Investment Agency for Class A Investor Certificate for this project in compliance with the Law on investment promotion.

What advice would you give to company owners and managers considering BSE listing?

First of all I want to point out that the public status brings not only prestige but also responsibilities. The companies that plan listing on BSE must be prepared for the challenges of the capital market and must be aware of the respective regulations.

They must also be aware of the transparency they need to have if they want to be public and of their responsibilities to shareholders and concerned parties.

It sounds difficult but if their aim is to attain quality corporate management, thing will get alright in the process. I wish good luck to all future public companies!



Photo: Kiril Genchev, member of the board of directors

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