VIENNA (Reuters) - Czech power firm CEZ (CEZPsp.PR: Quote, Profile, Research, Stock Buzz) expects profits to continue rising at a double-digit pace next year and in 2010 on the back of electricity prices and demand, sales chief Alan Svoboda said on Tuesday.
Svoboda told the Reuters Central European Investment Summit that wholesale prices for the next year were being locked in above this year's levels, which would largely be reflected in the company's bottom line.
Asked if CEZ expected to maintain double-digit profit growth in 2009 and 2010, he said: "Yes. Unless there is a combination of several negative factors," such as plant closures or market collapses.
CEZ has forecast net profit rising 14 percent this year to 48.6 billion crowns.
Svoboda said the impact of the credit crisis on CEZ, central Europe's largest company with market capitalization of $24.4 billion, would be neutral as demand in the region would still keep rising next year, although possibly at about half of the 4-5 percent pace seen in the past years.
He said power prices, driven by the German market, have dropped but should find support.
"Power prices came down from the 90 euro level (per magwatthour) to 70-75 euros and that's where I believe they will more or less stabilize," he said.
Svoboda said the company still planned to go ahead with a share buyback plan, and reiterated its size would be determined by alternative investment options.
The stock price, which has dropped by 40 percent this year to 820 crowns on Tuesday, is interesting, he said, but so were expansion opportunities.
He said conditions on the debt markets were difficult but added CEZ was in no rush and could wait for the situation to settle down before raising new debt.
He added CEZ need to refinance about 500 million euros worth of debt within the next about half a year.
(Reporting by Jan Lopatka)
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