Oslo shares close lower, led down by Norske Skog, Storebrand UPDATE

Oslo shares close lower, led down by Norske Skog, Storebrand UPDATE

	Published : Thu, 19 Apr 2007 16:48 By : Agencies Print this Story

(Updating with full report)

OSLO (Thomson Financial) - Share prices closed lower, led down by Norske Skog after the group said its first-quarter earnings will be hit by energy hedging costs, and by Storebrand after Kaupthing's CEO dismissed takeover talk, brokers said.

The OSEBX Benchmark index closed 1.43 points lower at 464.83 and the OSEAX All Share index shed 1.61 points to 525.64.

Total turnover amounted to 11.03 bln nkr.

Norske Skog closed 3 nkr lower at 93 nkr after the company said its first-quarter figures, due at the start of next month, will show an expense of 380 mln nkr related to energy hedging during the quarter.

It said this is an unrealised change in value that has arisen because 'future energy prices relate to some extent to underlying derivatives'.

Meanwhile, under financial items, the firm said currency effects during the quarter will contribute a gain of approximately 80 mln nkr, also largely unrealised.

Yara International was unchanged at 166.5 ahead of its first-quarter results tomorrow. The consensus is for EBITDA of 1.91 bln nkr, up from 1.49 bln on sales of 13.20 bln, up from 11.74 bln.

DnB NOR Markets sees the EBITDA at 1.945 bln nkr, saying there are indications in the market that Indian fertiliser buyers are starting to enter agreements for supplies from the Middle East at higher prices -- which could have a positive knock-on effect on Yara, too.

'We believe the share has more to go on,' said the broker, which has a 'buy' and a 185 nkr target price for the Yara stock.

Storebrand was 1 lower at 102.75 after Kaupthing chief executive Hreidar Mar Sigurdsson dismissed takeover talk, dealers said. In today's Dagens Naeringsliv newspaper, Sigurdsson is quoted as saying he has no interest in bidding for Storebrand.

DnB NOR shed 1.4 to 86.7.

Tomra Systems fell 1.2 to 44.3 on negative broker comments, dealers said.

Orion Securities maintained its 'sell' recommendation following the firm's first-quarter report earlier this week, dealers said.

The brokerage said that while the better-than-expected numbers had surprised both itself and the market, it was not enough to justify changing the house view on the stock.

Orion also maintained its 47 nkr price target.

Danske Equities kept its 'hold' recommendation on Tomra, describing the first-quarter report as 'a positive surprise,' despite the overall results coming in well down on the previous year.

The Danish broker, which has a fair-value range of 50-60 nkr on the stock, also said it had revised its 2008-9 estimates upwards by about 6-7 pct.

Aker Kvaerner added 0.25 to 132, reversing earlier rises that arose on rumours that the engineering firm's investor relations department has been unofficially guiding analysts lower ahead of next week's first-quarter report, dealers said.

This, one said, appears to have resulted in a series of estimate cuts and sell recommendations.

Carnegie, however, reiterated its 'outperform' recommendation on Aker Kvaerner.

Aker Yards shed 1 to 105.

EDB Business Partner added 0.5 to 54. Investors declared themselves 'satisfied' with the IT firm's first-quarter results, which were largely in line with expectations at the operating level, but fell below forecasts at the pretax level on higher expenses, and particularly interest payments, dealers said.

One analyst said he was reiterating his 'accumulate' recommendation, and would now be waiting for guidance about how management expects to extract synergies from the firm's recent acquisitions.

Tandberg closed up 1.25 at 133.5. The group's first-quarter earnings, published after the market close, met consensus for operating profit of 29.2 mln usd compared with 17.7 mln last time on sales of 126.3 mln compared with 82.7 mln, dealers said.

Tandberg Data shed 0.15 to 8.15. The group said the introduction of its LTO2 drive for new servers to a OEM customer has taken longer than expected, and this has in turn led to reduced sales in first quarter, compared to fourth quarter of 2006.

Nevertheless, the product margin for the first quarter and the net result are in line with the company's budget. The volume to other OEMs and Tandberg Data's distribution channel are satisfactory, the group said.

Telenor fell 0.25 to 110.75.

Orkla rose 7.5 to 467.5 and Renewable Energy Corporation added 2 to 154. UBS raised its target price on Orkla to 535 nkr from 500 nkr after the broker raised its stance and target on Renewable Energy to 'buy' and 190 nkr.

The European Commission said it has cleared Alcoa and Orkla's proposed joint venture in soft alloy extrusion. Both companies will contribute their entire soft alloy extrusion businesses to the joint venture, including their production facilities and employees. No financial details were disclosed.

Elsewhere, Norsk Hydro shed 1.25 to 201 and Statoil fell 1 to 164, while Petroleum Geo-Services rose 1 to 162.5 and Seadrill added 0.2 to 98.3.

michael.delaine@thomson.com

mdl/jsa

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