 "With the announcement of the third quarter results, there might be some disquiet amongst shareholders ...". So ran the press release which accompanied the first half numbers in early November of this year. It proved something of an understatement, with shareholders in Polish conglomerate Elektrim selling in droves in the immediate aftermath and analysts downgrading recommendations. The Polish team at ABN Amro focused on "soaring debt levels ... lower than expected cash flows". Flemings considered the results little short of "disastrous ... significantly worse than expected". How did Elektrim, to many investors the most effective large capitalization play on the Warsaw Stock Exchange, manage to create such disquiet? The company has certainly come a long way since being one of the five founding stocks listed on the nascent Polish stock market of 1992. Then, as now, an influential domestic player, it ran a rambling empire of over one hundred barely related businesses. Many of these were built on relationships dating from the 1970s and 1980s and put together in the asset grab of the early 1990s. At the time a reputation, a modicum of cash and a stock market listing went a long way. |