AvtoKrAZ AGM Decides To Invest In Development

AvtoKrAZ’s (KRAZ: HOLD) AGM yesterday approved the company’s 2006 financials: Net revenues decreased by 6.6% to USD 113.4 mln while net income fell by 30.8% to USD 11.4 mln.  AvtoKrAZ shareholders decided to direct all of their net income from 2006 into expanding production. Roughly 10% of 2007 net income will be directed toward dividends. Inna Perepelytsya: The management attributes the decline in net revenues to the inability to replace the company’s stalled Iraq orders with a large number of smaller orders. The management plans to increase orders by 20% in 2007.  Net income, though down, was almost twice higher than we expected due to the company’s inflated 2005 comparison base (the USD 6.6 mln the company officially reported as income in 2005 from tax we consider an extraordinary one-time amount).