Daily monitor

Dniprovagonmash [DNVM UZ, BUY], a Ukrainian railcar producer, produced 300 cars in January 2010, according to Interfax Ukraine. The Plant produced 364 cars in the whole of 2009, which averages out to be about 30 cars per month.

Ukrzaliznytsia (UZ), otherwise known as Ukrainian Railways, has announced its intentions to repair 30.8 thsd railcars in 2010 and to purchase 2.225 thsd new railcars. It also plans to execute capital repairs of 1.4 thsd railcars, and to extend the useful operational life for another 1 thsd railcars.

Kyivenergo [KIEN UZ] registered a UAH 130 mln net loss. KIEN's CFO noted that the Company's operating profit totaled UAH 464 mln, whereas the negative net income was mainly a result of fixed assets’ revaluation. The Company noted that the Kyiv City Administration owes KIEN compensation in the amount of UAH 1.5 bln for heat tariffs in 2008-2009.

The Minister of Agrarian Policy of Ukraine, Yuriy Melnyk, has announced delays in the sowing campaign in Ukraine due to unfavorable weather conditions. In the previous season, a few hundred thsd ha were sown at a similar date. Another factor that makes this season less favorable than the 2008/09 season is the fact that 7% of the winter crops sown are covered with a crust of ice, which will probably cause the loss of these crops.

According to the Yieh Corporation, global iron ore market leaders – namely BHP Billiton, Rio Tinto and Vale – have increased the iron ore price for China’s metallurgical companies by 40% to USD 80 per tonne for FY2010. At the same time, China’s consumers noted that this is only a preliminary agreement and that negotiations will continue.

According to the Managing Director of Arcelor Mittal Kryvyi Rih, Jean Rue, the Company plans to invest up to USD 200 mln in the modernization of production capacities and the fulfillment of its investment obligations.

Motor Sich [MSICH UZ, BUY], the largest CIS producer of the aviation engines, plans to finish testing of the MC-500B helicopter engine in 2010. This engine was developed for light class helicopters and is intended to be installed in the Russian Ansant helicopter, which experienced some problems with Pratt & Whitney’s engines. As a result, they plan to use Motor Sich’s engines instead of the Canadian ones.

The Ukrros sugar union, a major sugar producer in Ukraine, has announced its plans to produce 50 thsd tonnes of cane sugar out of raw cane sugar, which was imported according to WTO quotes for 2010 for the Palmir Sugar Mill. The Holding has already produced 15.7 thsd tonnes of cane sugar, which was also imported according to WTO quotes for 2009.

The South-Western Ukrainian railway intends to repair 844 passenger railcars in 2010. It is planned to conduct capital repairs of 57 railcars with in order to further prolong their period of exploitation. As well, 16 passenger railcars should be modernized by replacing their interior and a further 673 railcars should be exposed to minor repair.

IFC plans to provide USD 75 mln in financing to the Mriya [MAYA GR] agro holding, a major producer of crops in Ukraine. The issue is to be considered by the IFC’s Board of Directors on March 31, 2010. Preliminarily, the IFC financing should consist of a USD 25 mln subordinated loan, another USD 25 mln one-year loan with an option of prolongation, and USD 25 mln in warrant purchases. A warrant is a security that gives its owner the right to purchase a certain number of shares at a specified future date at a specified price.