Business News Business News
In this week’s Business News: shake-up at the top of ČEZ; refinery problems in pipeline; spirited performance from drinks giant; transport tenders on the move; and child’s play competition on the rails.
Troubled ČEZ shakes up top management
State controlled electricity giant ČEZ has undergone a substantial shake up at the top. In the biggest change, the trading division has been merged with strategy with the long time head of the former, Alan Svoboda, losing out to strategy boss Pavel Cyrani. Foreign and distribution sections are also combined, as are external affairs and foreign affairs divisions. ČEZ has recently been under pressure from a series of police investigations into former activities and with finance minister Andrej Babiš making critical comments about past investment decisions.
Low capacity use seen fueling refinery shareholder changes
The Czech Republic’ oil refinery sector is threatened by current low margins and use of refining capacity. The daily Dnes reported this week that Italian refinery giant AGIP is ready to exit and sell up its near 33 percent stake in the country’s biggest refiner, Česká Rafinérská. The remainder is indirectly controlled by Polish refinery giant PKN Orlen. One of the main problems is that Czech refineries are only being operated at around 75-80 percent of capacity which makes their profitability borderline at best, the paper said.
Spirits sales and distribution deals boost drinks group
The company behind the country’s biggest spirits producer Stock Plzeň Božkov says it boosted revenues last year by more than 16 percent and profits by just over 21 percent to almost 174 million euros. The Czech sales and profits of the Stock Spirits Group surged by around 17 percent. One of the reasons for the strong Czech performance is a series of deals to become the exclusive distributor for global brand names such as Johnnie Walker, Captain Morgan, and Smirnoff which were sealed in the second half of the year.
Transport tenders promised although state coffers running low
Transport Minister Antonín Prachař has pledged to put in motion construction tenders for around 54 billion crowns this year. Most of that work, to the tune of 38 billion crowns, will be related to rail infrastructure developments. The high volume of transport tenders will require that the coffers of the State Fund for Transport Infrastructure are filled up smartly so that some projects jointly pay rolled by EU funds do not run into problems. A funding shortfall of around 25 billion crowns is expected in both 2015 and 2016.
Childs’ play competition on the rails
The fierce fight for customers on the most competitive Czech rail route has taken a new twist with one of the operators to start offering a kids play corner in one part of a carriage. Train passenger operator Regiojet says it will start offer the play area on all services between Prague and the eastern town of Havířov. The play area should be equipped with games, books, and a television playing fairy tales. Such play areas are common in some parts of Europe, such as Switzerland, but this is believed to be the first time it is being offered on Czech rails.