Poltava Iron Ore Posts A 61.5% Increase In Sales And A Seven-Fold Increase In Net Income.

The company (PGOK: BUY) reported sales of USD 441.4 mln and net income of USD 50.8 mln in 2005. Last year, PGOK increased tonnage pellet sales by 4% to 7.5 mln mt, of which exports comprised 99%. Concorde Capital: Despite significant y-o-y improvement, PGOK’s reported financials fall short of our projections by 10% for sales and 35% for net income. We believe this is due to the company transferring a larger than expected portion of its sales to its trader and a controlling shareholder, Ferrexpo AG. The company has come a long way in reducing transfer pricing, though we were hoping for even greater improvements in transparency.