1 february 2007. 2 profile f.h.l. kiriakidis is a specialist in: ■ marble quarrying ■ marble...
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February 2007
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ProfileProfile
F.H.L. KIRIAKIDIS is a specialist in:
■ Marble quarrying
■ Marble processing
■ Distribution and sale of marble products
■ Production, sale and distribution of dry mortars
■ Working force 682 (Greece: 226; MACEDONIA: 403; China: 53)
■ Major Distribution centres in Athens, Salonica, Italy, China
F.H.L. KIRIAKIDIS is:
▲ An international player (65% of revenues in 2005 stem from abroad▲ The leading regional marble producer▲ A global leader in the manufacture of premium quality snow-white marble
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HistoryHistory
▲ FHL Kiriakidis was established in 1991
▲ FHL was listed on the Athens Stock Exchange in 1998
■ FHL acquired Mermeren Kombinat in 2000
■ FHL owns 88% of Mermeren Kombinat
■ FHL Mermeren was listed on the ASE in 2004
► FHL established Cosmos Building in China in 2000
► FHL owns 49% of Cosmos and Mermeren owns 51%
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Production CapabilityProduction Capability
▲ FHL Kiriakidis group currently has an annual marble production capacity of 22,000 m3
▲ FHL Mermeren (FYROM) has an annual marble production capacity of 25,000 m3
▲ FHL owns excavation sites (marble quarries) in:
■ Greece (Thassos, Granitis, Volakas, Nevrokopi)
■ Macedonia (Prilep)
▲ FHL has marble reserves of 5.3 million m3
■ 70 years of production with current capability and speed
▲ Product line includes:
● a diverse range of high quality marbles
● marble by-products such as processed plates, floor tiles, etc.
● prefabricated mortars
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Strategic
Business
Units
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Mermeren KombinatMermeren Kombinat
Acquisition 100% of Mermeren Kombinat at Prilep in October 2000
Acquisition cost: 16,3 million €
FHL acquired 12 new quarries in Prilep
Excavation of the snow–white Sivec marble
Total marble excavation: 90.000 tons in 2004
80.000 tons in 2003
Turnover: 13.4 ml € in 2006 13.9 ml € in 2005
11,2 ml € in 2004
The factory’s total area is 45,000 m2 The factory’s main building, covering an area of 9,000 m2
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Strategy
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Strategic IntentStrategic Intent
■ To utilize our know-how and production capabilities for projects like the Grand Mosque
■ To target added value, “artistic” marble projects globally
■ To increase productivity at the our quarries and factories
■ To establish the new factory at Kilkis
■ To proliferate into more dry mortars products
■ To increase sales in the Far East region through Cosmos
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SWOT Analysis SWOT Analysis
Company reputation
Near monopoly on high quality white marbles
Experience & high quality of personnel and management
High experience in the quarrying and processing of marble
Strong worldwide distribution network
Highly leveraged
Spread out facilities
Potential to expand further FHL operations in China
Acquisition of monopolistic position in beige and white marbles
Large raw materials deposits
Significant experience in the management of large quarries
Expansion of the worldwide distribution network
Significant competition from both domestic and international competitors creating pricing pressure
A significant economic downturn in one of the Company’s key markets, may significantly impact its results as marble products are considered as luxury items
Regulatory problems regarding marble quarrying in Greece
Strengths
Threats Opportunities
Weaknesses
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Financials
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FHL Group: Income Statement (ml FHL Group: Income Statement (ml €)€)
2004 2005 2006e 2007F
Revenues 39.4 45.90 44.07 47.25
EBITDA 11.5 11.4 11.7 14.1
Margin 29,3% 24.8% 26.2% 29.9%
EBT 4.8 5.6 5.5 6.6
Margin 12,4% 12.2% 12.5% 13,9%
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FHL Group: Balance Sheet (ml FHL Group: Balance Sheet (ml €)€)2004 2005 2006F 2007F
Assets 62.02 62.6 77.7 77.7
Inventories 27.1 33.5 31.0 31.4
Other current assets
40.2 50.9 50.3 48.2
Total Assets 129.3 146.9 159.1 157.3
Total shareholders’ equity
43.2 46.2 60.0 64.0
Long term debt 52.6 53.2 61.4 56.4
Short term debt 33.5 47.5 37.7 36.9
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Athens Stock Exchange FHL
Athens Stock Exchange: KYPMReuters: KRKr.ATBloomberg: KYRM GAShare Price (20/3/07): € 2.20Average Trading Daily Volume: 67,424Capitalization Feb 2007: € 54,5 ml Shares Outstanding: 24.772.000
Shareholders’ Structure
Kyriakidis family 53.0%Institutional Investors 8.3%Retail Investors 38.7%Total 100%
Shareholders’ Structure
FHL Kyriakidis Group 88%Employees 2%Investors 10%Total 100%
FHLMAthens Stock Exchange: MEPKOReuters: FHLr.ATBloomberg: MERKO GA Share Price (20/2/07): € 7.60 Average Trading Daily Volume: 2,155Capitalization Feb 2007: € 35.6 ml Shares Outstanding: 4,687,000
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Investment CaseInvestment Case
▲ FHL Kiriakidis Group:
► is a major force in the global marble industry
► has a worldwide reputation for delivering on time
► has the visibility as an artistic marble entity
► has prime marble stock for almost 100 years
► has expanded into the fast growing economies of
the Far East
► has penetrated the Middle East markets