Motor Sich 2011 profit misses expectations

Motor Sich (MSICH UK) increased its net profit 8% yoy to UAH 1.34 bln in 2011, according to preliminary results announced yesterday. The figure implies 4Q11 profit was down 13% yoy to UAH 474 mln, which is unexpected after 23% yoy stronger income in 9M11. Complete financials for 2011 have not yet been published. In the same report, the company announced its AGM will take place on March 22.

Roman Dmytrenko: As 2011 income fell significantly short of market expectations (25% below Bloomberg consensus and 15% below its most conservative component), there could be a short-term negative market reaction to the news. We attribute the drop in the company’s bottom line to foreign exchange losses (e.g. due to ruble devaluation) and higher income tax in 4Q11.