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[loganair] 02/6/2015 14:32

City Sightseeing inaugurates a new service in St. Petersburg:

City Sightseeing St. Petersburg begins operations in ‘The Baltic Pearl’ with four panoramic double decker buses, custom made with a transparent cover for the colder months that can be opened in the warmer months.

City Sightseeing’s tour of St. Petersburg covers the main attractions of the city, especially those in the Central and Admiralty districts, and lasts 90 minutes. During the journey, travelers can access and follow entertaining commentaries created by the historians of St. Petersburg Institute of Hospitality, which can be enjoyed simultaneously in 12 languages: English, Russian, German, Italian, Chinese, Turkish, Finnish, Spanish, French, Japanese, Korean and Arabic.

Founded by Tsar Peter the Great in 1703 in order to become “Russia’s window to the West”, St. Petersburg is a great cultural destination. The city is home to more than 200 museums, many of them housed in historic buildings, with the Hermitage Museum at the forefront of these. Furthermore, the historic centre of the city and other monuments have been classified as World Heritage Sites by UNESCO, highlighting the Baroque and neoclassical buildings style that survived or have been painstakingly reconstructed following the siege of Leningrad during World War II.

City Sightseeing St. Petersburg users can toggle the tourist bus tour with a boat tour on the Neva river organised by Astra-Marine and embark at four piers located along the bus route.

[loganair] 02/6/2015 14:28

Analysts at Rosbank said in a note that for now the dollar's value against the rouble was meeting strong resistance around the 53.50 level, but they expected this level to be breached soon as the rouble retreat resumed.

"There is a wide range of factors capable of encouraging this: the publication of strong data from the U.S., the mood of global investors, local weakness of the oil price, the actions of Russian regulators," they wrote.

[loganair] 02/6/2015 14:27

Analysts at Rosbank said in a note that for now the dollar's value against the rouble was meeting strong resistance around the 53.50 level, but they expected this level to be breached soon as the rouble retreat resumed.

"There is a wide range of factors capable of encouraging this: the publication of strong data from the U.S., the mood of global investors, local weakness of the oil price, the actions of Russian regulators," they wrote.

[loganair] 01/6/2015 09:41

Strong oil move sends Russian market down. The Russian market fell significantly towards the close of trading on Friday, erasing intraday gains and closing down 2.2%, due to the stronger ruble, which was supported by the surge in the oil price. Oil names were among the main losers, as Surgutneftegas prefs fell 5.6%, Rosneft locals declined 4.8% and Gazprom shares lost 4.9%.

[loganair] 01/6/2015 09:39

EBITDA margin surges to 2008 level on weaker ruble - Revenues grow 71% YoY, EBITDA margin expands 20 ppt. Phosagro (PHOR LI – Buy) (JRS 9th largest Investment) published consolidated 1Q15 IFRS results on Friday. EBITDA and net income exceeded the consensus expectations. Revenues grew 71% YoY to RUB50 bln ($0.8 bln), EBITDA almost tripled YoY to RUB24.6 bln ($0.4 bln), and the EBITDA margin expanded 20 ppt YoY to 49%, close to the 2008 level. The net profit increased to RUB14 bln ($231 mln) from RUB2 bln in 1Q14. Despite making a net loss in 2014, mainly due to the non-cash FX impact, the BoD approved a dividend of RUB48/share, which implies a modest dividend yield of close to 2%.

[loganair] 29/5/2015 09:17

1Q15 IFRS review: stabilization, but not recovery - NIM has probably bottomed out. Sberbank (SBER RX – Buy) (JRS 4th Largest Investment) reported 1Q15 IFRS results yesterday. Net income came in 39% above consensus, thanks mainly to a large FX gain. NIM fell 180 bps QoQ to 3.6%, the same decline that was seen from VTB and slightly worse than the 160 bps QoQ drop the market had expected. The loan yield did not change much QoQ, while the effective cost of deposits rose 160 bps QoQ and interbank funding costs jumped 360 bps QoQ. Management suggested that NIM likely bottomed out in 1Q15 and should gradually recover to the 4Q14 level by year-end, before normalizing at no less than 5% in 2016. The effective tax rate, which was pretty high in 1Q15 at 39%, should normalize over the course of this year, according to management.

[loganair] 28/5/2015 08:35

Improvement in sentiment will support economy - Recession not as deep as expected. Although all key sectors, with the exception of agriculture, shrank in 4M15, in many sectors, the contraction was smaller than the market expected at the start of the year. It seems that import substitution was a material factor supporting industry, as industrial production dropped only 1.5% YoY in 4M15. At the same time, retail trade and construction were hit the most severely, due to the sharp drop in consumer demand and capital investment, as a result of the sharp ruble depreciation of late last year and the subsequent hike in consumer prices.

[loganair] 26/5/2015 15:23

Should You Take a Contrarian Bet on Russia?

Morningstar Investment Management's Ed Fane says last year Russia was a classic opportunity for a contrarian, offering great value and negative investor sentiment.

Contrarian investing is not simply about buying unpopular assets, but about owning those assets during the recovery process and knowing when to sell. Our holding in Russian equities is a case study of the way these opportunities evolve. Last year Russia was a classic opportunity for a contrarian, offering great value, poor news flow and negative investor sentiment. When purchasing the position we were very confident that value would generate attractive returns.

This has become the most ‘interesting’ of our contrarian positions as many of the key aspects of the original investment case have now changed. Heavy falls in the oil price, the rouble, the intensity of the crisis in Ukraine and associated sanctions, have all reversed to some extent.

As we enter the next phase of the investment journey we have to rely less on compelling metrics and lean more on a nuanced fundamental view.

[loganair] 26/5/2015 15:16

May 26 - First deputy governor of the Russian central bank, Dmitry Tulin, said today that the bank was increasing its gold reserves.

Russia, the fifth-biggest holder of the yellow metal, has increased its stocks by 8.333 tons to 1,246.625 tons in April, buying for the second straight month after a pause early this year.

[arja] 25/5/2015 11:37

it is wrong to say that the west have said that Russia can keep Crimea but not much they can do about it while Putin is in charge ! even post Putin and with some kind of democracy , it is doubtful that Russian will pull out of Crimea .

[loganair] 23/5/2015 20:25

OXMAN - The West have already basically said that Russia can keep Crimea or actually Crimea being returned to Russia as it was an integral part of Russia for around 1,000 years and is home of the Russian Orthodox Church before the Soviet leader the Ukrainian Nikita Khrushchev and his deputy at the time the Ukrainian Leonid Brezhnev gave it to the Ukraine.

Living in Russia myself I'm not at all worried, in my opinion it's a very easy call over the medium and long term as long as one is able to ride out the ups and downs over the short term, over the next couple of years.

[its the oxman] 23/5/2015 20:16

Tempted to add here but Ukraine remains too difficult to call. Shame as undoubtedly cheap.

[loganair] 22/5/2015 09:56

Russian meat producer Cherkizovo (JRS 12th Largest Investment) said today its net profit fell 7.7 percent in the first quarter, year-on-year, to 2 billion roubles ($42 million) while its margins increased to 17% from 15%.

Revenue at Cherkizovo rose 30 percent to 17 billion roubles and its adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) jumped 52 percent to around 3 billion roubles.

Chief executive Sergei Mikhailov said: "Despite the very challenging economic situation in Russia and the slowdown in consumer demand, Cherkizovo Group continued to its robust growth.

"We substantially increased our poultry sales due to the acquisition of Lisko Broiler in 1Q 14 and launch of the first Eletsprom poultry facility in 4Q 14. In the meat processing division, we increased sales of ready-to-cook products and bone-in meat made of pork supplied by the Company's own farms. "We are recovering from the African Swine Fever outbreak at two of our pork complexes in December and January. No new ASF cases were discovered at our facilities. The affected facilities will be relaunched after the quarantine by the end of the year. Due to rapid growth of the pork division, we start the construction of new pork complexes in Voronezh Region."

[loganair] 22/5/2015 09:50

MOSCOW-The Bank of Russia continued intervening in the currency market and bought another $200 million on Wednesday, the bank said on Friday.

The central bank--which reports its currency market activities with a two-day lag--resumed interventions last week in order to replenish the country's depleted reserves. Analysts say the central bank buying foreign currencies is aimed at limiting the ruble's recovery.

Since purchases began on May 13, the central bank has bought $1.18 billion. Russia's international reserves rose $3.8 billion to $362.3 billion in the week to May 15.

[loganair] 21/5/2015 15:46

The International Monetary Fund predicts a less severe recession for Russia and says the country's economy will return to growth in a "mild recovery" next year.

Following a recent staff visit to Russia, the IMF says in a statement that it now predicts a 3.4 percent contraction in GDP this year and says "growth should resume" in 2016.

In its World Economic Outlook last month, the organization had predicted a 3.8 percent contraction this year, with GDP down a further 1.1 percent next year.

On Thursday, the IMF did not estimate the size of Russia's expected 2016 growth, but said medium-term growth would likely be 1.5 percent, accompanied by inflation dropping below 10 percent. "Structural bottlenecks" would impede long-term growth, the statement added.

[loganair] 18/5/2015 12:05

According to Rosstat’s preliminary estimate, GDP contracted 1.9% YoY in 1Q15, which is less than the Bloomberg consensus of 2.6%, the Economic Ministry’s estimate of 2.2%. According to the Economic Ministry’s monthly data, the economy shrank 3.4% YoY in March, 1.2% YoY in February and 1.4% in January. GDP declined YoY for the first time since 2009, as the 4Q14 figures were recently revised up from a contraction of 0.2% YoY to 0.4% YoY growth.

[loganair] 17/5/2015 12:48

It was interesting to note that while Kerry said that he was certain US and EU sanctions against Russia would be lifted if the Minsk agreement was fully respected, he did not even utter a word about Crimea. It has become quite clear that the international community is willing to forget about Crimea (annexed illegally by Russia) in return for an end to the conflict in eastern Ukraine and a guarantee of Ukraine’s territorial integrity (minus Crimea). This is simply a matter of realpolitik and in the circumstances make sense.

There was no major breakthrough at the end of the talks but the discussions were soft and cordial in tone, perhaps signalling a new willingness by both sides to reverse the setbacks that their relationship has gone through.

[loganair] 15/5/2015 09:53

Russian inflation ended an eight-month climb in April, decelerating for the first time since July. Year-over-year growth in consumer prices will probably slow to 5% in the next 18 months from the current level of 16.4%.

[loganair] 15/5/2015 09:45

Russia has managed to wrench investors away from the world’s best currency trade without denting demand for its bonds.

While the central bank halted the ruble’s advance on Thursday by purchasing foreign exchange for the first time since November, government debt denominated in the Russian currency extended the biggest gains in emerging markets this year.

The rally underscores bondholder confidence that the recovery in oil prices and reduced tension in Ukraine will enable Bank of Russia governor Elvira Nabiullina to reverse last year’s emergency interest-rate increase without stoking inflation. The ruble has strengthened 21 percent against the dollar this year, more than twice as much as any other currency.

“The central bank still has room to cut rates as long as the ruble behaves itself,” said Edwin Gutierrez, who helps oversee $13 billion at Aberdeen Asset Management in London.

Russian inflation ended an eight-month climb in April, decelerating for the first time since July. Year-over-year growth in consumer prices will probably slow to 5 percent in the next 18 months from the current level of 16.4 percent, Bank of America Corp. strategist David Hauner said in a research note on May 14. The decrease in inflation makes him bullish on Russia’s OFZ bonds longer term, he said.

The slowdown in inflation and the gains in the ruble will allow for more easing of monetary policy, reviving economic growth and benefiting investors, according to James Barrineau, co-head of emerging-market debt relative at Schroder Investment Management. He forecasts a reduction in borrowing costs of as much as 400 basis points before the end of this year if consumer prices keep falling.

[loganair] 15/5/2015 09:21

New earnings high - Net interest income rises above expectations. Moscow Exchange (JRS 3rd Largest Investment) published 1Q15 IFRS results yesterday. EBITDA and net income set new all-time highs and exceeded the consensus by 7% and 9%, mostly thanks to net interest income being even higher than forecast, supported by higher yields (the effective yield rose 30 bps QoQ to 2.4%) and the average daily investment portfolio rising almost 50% QoQ, with the ruble part of client funds growing 17% QoQ. Fees were in line with the consensus, falling 24% QoQ, but increasing 8% YoY. Also, starting from this year, Moscow Exchange recognizes part of income earned through long-term instruments in FX transactions, in the money market and through derivatives as deferred, which, for example, amplified the decline in derivative fees to 43% YoY; otherwise, they would have fallen 31%.

[loganair] 15/5/2015 09:19

Consolidated sales growth contracts 4.1 ppt MoM to 20.5% YoY. Dixy Group (JRS 10th Largest Investment) published a disappointing trading update for April yesterday. Growth in consolidated revenues slowed 4.1 ppt MoM to 20.5% YoY to RUB21.9 ($415 mln). Revenue growth was much weaker than Magnit’s (JRS 2nd Largest Investment) revenue growth of 28.7% YoY in April. Also, the slowdown in food inflation could only be attributable to a fraction of the deceleration of Dixy’s revenue growth, in contrast to Magnit. Segment-wise, sales grew the fastest at Dixy neighborhood stores, increasing 22.6% YoY to RUB17.7 bln ($333 mln), while sales at the Victoria and MegaMart divisions rose 13.3% YoY to RUB2.8 bln ($43 mln) and 10.5% YoY to RUB1.5 bln ($28 mln).

Still 20% growth rate far far better than we have in the UK or the rest of Europe or the US and Canada.

[loganair] 15/5/2015 09:15

1Q15 operating update: production and sales volumes grow YoY - Fertilizer sales grew 2.8% YoY in 1Q15. Yesterday Phosagro (PHOR LI – Buy) (JRS 9th Largest Investment) published an operating update for 1Q15. Fertilizer production and sales increased 8.3% and 2.8% YoY. Nitrogen-based fertilizer sales volumes declined 3.3% YoY to 0.4 mln tons, while sales volumes of phosphate-based fertilizers increased 5.0% YoY to 1.3 mln tons. Phosphate rock production volumes remained almost flat, growing just 0.6% YoY to 2 mln tons.