WBJ #10 2011

WBJ looks at the companies and trends beautifying the Polish market

WWW.WBJ.PL

A SPECIAL SUPPLEMENT ON POLAND’S COSMETICS INDUSTRY

VOLUME 17, NUMBER 10 • MARCH 14-20, 2011 . z∏.12.50 (VAT 8% included) . ISSN 1233 7889 INDEX-RUCH-332-127

Since 1994 . Poland’s only business weekly in English

REAL ESTATE

Who’s for regulation?

Lokale Immobilia

COURTESY OF PROMOTION

Everybody agrees that Poland’s fast-growing credit unions need to be regulated. So what’s the holdup?

• MIPIM 2011 • Warsaw Spire • Oaza in Wroc∏aw 17-19

8-9

Going in the right direction WBJ looks at multinational manufacturer 3M’s ambitious plans for the Polish market 6-7

A guide to Polish business and industry

Przewodnik po polskim biznesie i gospodarce

Private health care centers in Warsaw 21

SHUTTERSTOCK

In this issue News . . . . . . . . . . . . . . . . . . . . . . .2-4 Listed Firms . . . . . . . . . . . . . . . . . . .5 Industry News . . . . . . . . . . . . . . . . .6 Company Focus . . . . . . . . . . . . . . . .7 Cover Story . . . . . . . . . . . . . . . . . .8-9 Opinion . . . . . . . . . . . . . . . . . . . . . .10 Cosmetics Supplement . . . . . .11-15 Business Environment . . . . . . . . .16 Lokale Immobilia . . . . . . . . . . .17-19 Markets . . . . . . . . . . . . . . . . . . . . . .20 The List . . . . . . . . . . . . . . . . . . . . . .21 Arts & Culture . . . . . . . . . . . . . . . .22 Last Word . . . . . . . . . . . . . . . . . . . .23

Pension reform a go

The gaul of it all

The government has committed to its contentious pension plan, despite fierce opposition

France bullied Sweden and Poland in order to keep “business as usual” with Russia, WikiLeaks reveals 4

2,3

A GUIDE TO POLISH EXPORT will h it sh elves in April 2 0 1 1 !

For advertising and promotion opportunities contact: Agnieszka Brejwo: abrejwo@wbj.pl; (+48) 639-85-68, ext. 226

NEWS

www.wbj.pl

Solidarity with Japan President Bronis∏aw Komorowski extended his condolences to the victims of the earthquake and tsunami which hit Japan last Friday. PM Tusk also expressed his sorrow in a telegram to Japan’s PM, Naoto Kan. Foreign Minster Rados∏aw Sikorski ensured his Japanese counterpart, Takeaki Matsumoto, of Poland’s readiness to provide all necessary aid to the victims. The 8.9magnitude earthquake hit Japan at 2.49 pm local time. As WBJ went to press on Friday, local media reported at least 350 deaths.

No chance for Kaczyƒski?

In an interview for Newsweek, President Komorowski said that while the head of the winning party has the greatest chance of being chosen as PM, he reserves the authority to designate a politician to form a goverment. The president said that he would choose someone who is not only “a supporter of change and modernization, but also of common sense.”

Asked if he would nominate Jaros∏aw Kaczyƒski, leader of the Law and Justice (PiS) party, in the event of a PiS victory, the president politely declined to answer.

Exports surge, imports slow In January, Polish exports rose by 17.3% y/y, reaching €9.3 billion, while imports rose by 9%, to €9.4 billion. “We are noting a continuous positive trend in export growth,” Piotr Bielski, an economist at Bank Zachodni WBK told Parkiet. Import growth, however, has slowed down. In December, imports grew at a rate of more than 20%, whereas in January, this rate had fallen to 9%.

MARCH 14-20, 2011

IN THE SPOTLIGHT

Numbers in the News

Rostowski v. Balcerowicz

31% of directorial and managerial positions in Poland are filled by women

6% of women start their careers aspiring to reach a top corporate post

z∏.16 billion is how much money Poles spent last year on online purchases

z∏.18 million is the estimated amount that Poles will spend on game downloads by 2013

Quote of the Week “[Donald Tusk] has the qualifications to be a fashion model. Probably [fashion] for men.

Middle-aged men”

REPORTER, WORLD ECONOMIC FORUM

2

Jaros∏aw Kaczyƒski, in an interview with Super Express, suggests employment alternatives for the PM following October's election

The long-running debate over the government’s pension reform plan should reach its climax this week with a televised confrontation between Finance Minister Jacek Rostowski and Leszek Balcerowicz, a former finance minister and central bank head. The two have come to represent the opposing camps in the pension debate.

Mr Balcerowicz has been publicly critical of the government’s plans for months; in January his NGO, the Civil Development Forum Foundation, came up with its own counter-proposals on how to reduce public debt. At the beginning of last month, Mr Rostowski called on Mr Balcerowicz to join him in a televised debate.

The government’s official

acceptance of the reform plan last week led Mr Balcerowicz to take up the gauntlet. “Until recently, it was not clear whether the individual ministers were presenting their private opinions or the opinion of the whole government when commenting on the pension reform. The government’s March 8 decision removed that uncertainty,” Mr Balcerowicz said in a statement.

With reference to Mr Rostowski’s invitation to debate the issue, he said he expected the government to designate someone to join him in the debate, but indicated that no one had been officially chosen at that point. “I have nothing against it being Finance Minister Jacek Rostowski,” Mr Balcerowicz said.

The latter has already expressed his satisfaction with Mr Balcerowicz’s willingness to discuss the matter. He told journalists that the debate should last at least an hour so that he and Mr Balcerowicz would have enough time to present their respective positions. As to the format of the event, it should be a one-onone debate, Mr Rostowski said.

As WBJ went to press, no date or time had been announced. Mr Rostowski, however, stressed that the event need not take place before the changes were voted on by the Sejm. The goal of the debate, he said, is to convince Poles that the reform is for the better rather than to influence voting in the Sejm.

Adam Zdrodowski

Figures in focus Moms in charge Percentage of single-mother households in total households, 2009 10 9 8 7 6 5 4 3 2 1

EU27

Greece Poland Germany Czech Rep. France Lithuania

UK

Estonia Source: Eurostat

Company index “Archiplan” Studio Projektowe

Gant Development ....................20 Optimus ......................................20

Ewa Widera ................................18 Gaz-System ..................................6 PBG ............................................20 3M ................................................7 Gazprom Neft ..............................5 Pevonia ......................................15 Access MBA Tour ......................16 Getin Holding ............................20 PGNiG ........................................20 Allegro ........................................11 Ghelamco ..................................17 PKE ..............................................6 AP Szczepaniak studio ..............18 Globe Trade Centre....................20 PKN Orlen ..................................20 Architektury Kontur ..................17 Groupon.pl..................................11 PKO Bank Polski..........................5 Asseco Business Solutions ........5 Grupa Medicover........................21 Polimex-Mostostal ....................20

On WBJ.pl

Asseco Poland..............................5 Gruper.pl ....................................11 Astarta Holding ..........................20 Heitman International ..............19 Atlas Estates ..............................18 Helio ..........................................20 B’ART Pracownia Architektury,

Poland in the Arctic circle It is a little-known fact that Poland has been an Observer State of the Arctic Council since its inception, and that Polish researchers have been active members of the Arctic research community for decades. As the Arctic becomes a hot-spot for research on climate change and for political influence among major powers, Poland aims to be part of the discussion. Log on to WBJ.pl to see what it has to say.

Hellmann Worldwide Logistics

Urbanistyki i Wn´trz ..................17 Polska ........................................19 Bank BPH ..................................17 Hilton Warsaw Hotel & Bank Millennium........................16 Convention Centre ....................18 Bank Zachodni WBK....................2 IBM ............................................17 Berkshire Hathaway ....................3 ING................................................6 BRE Bank ..................................16 Invest Bank ..................................3

PolRest ......................................20 Polsat ..........................................3 Polska Fundacja Europejskiej Szko∏y Onkologii ........................21 Praktycy.com ........................11, 15 PricewaterhouseCoopers ............3 Projektmanagement Polska......19 ProLogis ....................................19 PZU ............................................17

BZ WBK ......................................17 Ipopema Securities....................16 Rosneft ........................................5 CB Richard Ellis ........................17 Jaspers Eyers & Partners ........17 SABMiller ....................................3 Cederroth ..................................14 Jones Lang LaSalle ..................19 Schneider Electric .17 Jutrzenka ....................................6 Segro ..........................................19 Centrum Medyczne Nasze Zdrowie ......................................21 KGHM ........................................20 Sensor Cliniq..............................21 Centrum Medyczne Osteomed 21 Klinika Medyczna IBIS ..............21 SKOK ............................................8 Centrum Medyczne DANTEX-

Krakchemia ................................20 Société Générale..........................3

MED ............................................21 Kredyt Bank ..............................16 Soraya ........................................14 Centrum Medyczne ENEL-MED21 Kulczyk Holding ..........................3 SPA Wilanów ..............................15 Centrum Medyczne Mavit..........21 L’Oreal ........................................14 Spó∏dzielnia Pracy Specjalistów Chemoservis-Dwory ..................20 Landesbank Baden-Wurttemberg

Poles’ banking confidence A survey by consulting firm Ernst & Young has revealed that most Poles are satisfied and plan on staying loyal to their current banks, Gazeta.pl reported. Only 9% are planning to switch their main accounts, according to the survey ●

DATELINE

March 14

CURRENT ACCOUNT DATA

22

INFLATION DATA

Event:

The National Bank of Poland releases current account data for February

Event:

The National Bank of Poland releases January and February inflation data

18-21 COSMOPROF Event:

The world’s most important international event in the beauty and cosmetics sector.

Location: Bologna, Italy www.cosmoprof.com/en

29-30 CEE BANKING Event:

CEE BANKING SUMMIT. Location: Hotel Polonia Palace, Warsaw. www.tcct.pl

Rentgenologów ..........................21 Citeam.pl ..............................11, 15 and Ceskoslovenska ....................3 ST Dupont ..................................23 Cognor........................................20 Lotos ............................................3 Studio Urody Impress ................15 Colian Investement......................6 Lux-Med ....................................21 Synopsys Poland ........................17 CommerzReal ............................19 Mamaison Hotel Le Regina ......16 Tauron ..........................................6 Cyfrowy Polsat ..........................20 Maria Galland ............................15 Tauron Polska Energia ..............20 Dax Cosmetics ..........................11 Maximilian Büsser & Friends ..23 Techmex ....................................20 Deloitte ......................................17 Mayland Real Estate..................18 TNK-BP ........................................5 Deutsche Bank ............................6 McKinsey & Company................19 Torus ..........................................17 Dom Development ....................18 Megapanel PBI/Gemius ............11 Totalserve (Polska) ....................16 e-biznes.pl..................................11 MEMRB ......................................14 TPSA ..........................................20 Echo Investment ........................17 Microsoft ......................................3 Tulipan House ............................19 Elektra Plus ..............................17 Miller, Canfield, W. Babicki, A. UniCredit ......................................5 Energa ..........................................3 Chelchowski & Partners ............9 Ernst & Young ..............................2 Mydeal.pl ....................................11 Warsaw Stock Exchange ..........17 Nordea..........................................6 World Bank ..................................9 Otwock........................................21 Oceanic ......................................11 X-Trade Brokers ........................20 Fastdeal.pl..................................11 One-2-One..................................20 Xelion Doradcy Finansowi ........17 Europejskie Centrum Zdrowia

First Data ..................................17 Ophir Energy, ..............................3 Ziaja ............................................14

NEWS

MARCH 14-20, 2011

www.wbj.pl

Pension reform

Tusk commits to reform plan Despite continuing opposition to the move, the government is moving ahead with its reform scheme

COURTESY OF KRZYSZTOF MYSTKOWSKI/KPRM

After months of debate, Prime Minister Tusk has publicly committed his government to implementing its controversial pension reform plan.

It will slash the pension contributions paid into open pension funds (OFEs) from 7.3 percent of monthly salaries to 2.3 percent. The other five percent will be funneled into ZUS, Poland’s state-controlled social security fund.

By 2017, the percentage of salaries paid into OFEs’ coffers will increase to 3.5 percent.

Without the reform, the government claims it would have to borrow z∏.190 billion between now and 2020 in order to cover ZUS’s shortfalls in making current pension payments. So the changes are expected to help reduce public debt.

is that it has done nothing in the past three years to repair public finances, allowing for the present situation,” he said.

“From the political point of view, it is one of the best moves they could make, because without implementing painful measures that households would feel immediately, they have with one decision greatly improved the budget situation,” Mr Janecki stated.

He added, however, “From the economic point of view, it’s not so good. In my opinion it will halt further moves for budget consolidation and budget reforms, as the government will now have a more relaxed situation.”

A show of debate

Mr Tusk appears determined to implement his plan development and [would] lower the probable size and security of future pensions.”

Another vocal opponent of the reform is Krzysztof Rybiƒski, a former deputy president of the National Bank of Poland. He has announced his intention to file a class action lawsuit against the government for lost income due to the changes in the pension system. Mr Rybiƒski estimates that each taxpayer will lose tens of thousands of z∏oty in pension capital over the next 40 years,

Strong opposition The move has been criticized severely by a number of economists, including Leszek Balcerowicz, a former finance minister and national bank president, who has stated that the changes would “be detrimental to Poland’s economic

which will in turn lead to lower pensions.

But the prime minister doggedly defended the reform last week. “If I have to pay a political price, then I say openly: I would rather lose the [October parliamentary] elections than tell the taxpayers that I will look in their pockets for that z∏.200 billion,” he said.

Commenting on the PM’s final decision, Mr Balcerowicz said that he intended to publish a white paper detailing the government’s “propaganda.”

A necessary solution?

Not all economists are as critical of the move. “This is a compromise which doesn’t make anyone happy, but it is simply a necessary solution,” said Witold Or∏owski, chief economist at PricewaterhouseCoopers and a former presidential economic advisor.

Jaros∏aw Janecki, chief economist at Société Générale in Poland also favors that interpretation. “I am quite close to Mr Or∏owski’s point of view, but I must stress that my problem with the government

A television debate is set to take place, most probably this week, between Mr Balcerowicz and Finance Minister Jacek Rostowski. Yet the outcome of the debate will have little impact on the reform plan.

Parliament is set to start work on the legislation this Wednesday and to finish by March 30. Prime Minister Tusk would like the reforms to come into effect on May 1.

Although the opposition parties are sure to put on a good show in parliament, the ruling coalition will most likely have enough votes to pass the bill comfortably.

Remi Adekoya

Crime

Jan Kulczyk still Furor over presidential pardon Poland’s richest man

Squabbling filled the media last week following the revelation that late President Lech Kaczyƒski granted amnesty in 2009 to Adam S., a convicted fraudster and business partner of his son-in-law, Marcin Dubienecki.

Over a period of eight years, Adam S. defrauded the National Disabled Persons Rehabilitation Fund (PFRON) of z∏.120,000 by illegally claiming compensation for injured workers whom he had never in fact employed. According to press reports, his actions also cost the State Treasury at least z∏.30,000.

Adam S. was defended in court by Mr Dubienecki’s father and later went into business with Mr Dubienecki himself. He was sentenced to a two-year suspended jail term, until Mr Kaczyƒski granted

COURTESY OF WIKIMEDIA COMMONS

Amnesty for a business partner of the late president’s son-in-law stirs a hornets’ nest

Jaros∏aw Kaczyƒski says some are out to “soil” his brother’s name him amnesty via a fast-track procedure.

When confronted by journalists about the situation, Mr Dubienecki’s reply was: “F*$% off.”

Piotr Kownacki, the head of the President’s Chancellery at the time, was the person who initiated the administrative procedures necessary to start the amnesty process. He has refused to comment on the issue.

Fueling the flames of specu-

lation is the fact that the late president ignored the prosecutor’s negative opinion concerning the amnesty and chose not to ask the sentencing court for its view, as is the norm.

Jaros∏aw Kaczyƒski, Law and Justice party leader and twin of the late president, has decried calls for an investigation as part of a campaign to “soil” his brother’s name.

During his presidency Lech Kaczyƒski granted amnesty to Remi Adekoya 200 people.

Forbes magazine’s latest ranking of the world’s billionaires includes four Poles.

Businessman Jan Kulczyk (ranked 440) was found to be the richest man in Poland for the second year running. He was followed by Zygmunt Solorz-˚ak (488), the owner of Invest Bank and Polsat; banking and real estate tycoon Leszek Czarnecki (595); and construction and real estate magnate Micha∏ So∏owow (651).

Kulczyk’s net worth is estimated at $2.6 billion, compared to Mr Solorz-˚ak’s $2.4 billion. Both men increased their wealth compared to the 2010 edition of the list, when the former was worth $2.1 billion and the latter $2 billion.

Jan Kulczyk’s investment

vehicle, Kulczyk Holding, owns a stake in multinational brewer SABMiller (Miller, Grolsch, Lech, Tyskie) and has investments in a wide variety of other industries, including automotive imports, infrastructure, chemicals and energy. Mr Kulczyk has been actively pursuing new investments in the latter sector, in Africa-focused upstream oil and gas firm Ophir Energy, for example. He has also expressed interest in Lotos and Energa.

Mexico’s telecoms tycoon Carlos Slim topped the list.

Microsoft founder Bill Gates came second, while Warren Buffett of Berkshire Hathaway was the third-richest person in Forbes’ ranking.

Katarzyna Piasecka

The richest of Poland’s rich Rank

Name

Net worth

Age

Source

440

Jan Kulczyk

$2.6 billion

61

Telecoms, oil, beer

448

Zygmunt Solarz-˚ak

$2.4 billion

54

TV broadcasting

595

Leszek Czarnecki

$2 billion

49

Finance

651

Micha∏ So∏owow

$1.9 billion

48

Investments

Source: Forbes’ ”World’s Billionaires 2011” list

3

Record year for M&A This year will be a record-breaker in terms of mergers and acquisitions in the Polish market, Rzeczpospolita reported. The potential value of the top 25 transactions due to be finalized this year is z∏.63 billion. Last year, Reuters recorded 423 mergers and acquisitions for a total value of z∏.55 billion. This is good news for the law firms, consultancies and investment banks that deal with M&As.

Z∏oty to gain?

Analysts expect the z∏oty to strengthen against the euro in the next few months. The median euro-z∏oty rate predicted for the end of Q2 2011 by experts surveyed by Bloomberg is z∏.3.83, Parkiet reported.

Whereas the analysts from Landesbank BadenWurttemberg and Ceskoslovenska Obchodni Banka predict that at the end of Q2 one euro will cost around z∏.3.50, Bank Pekao is less optimistic. In a report it predicted that the value of the EUR/PLN would reach z∏.4.12 at the end of Q2.

Alcohol ban costly Legislation proposed by the Senate to prohibit alcohol sales at gas stations could drive fuel prices up by 3-5 grosz a liter, the owner of a major Polish fuel company told Dziennik Gazeta Prawna anonymously. Because alcohol sales account for a quarter of revenues generated at gas station stores, the proposed legislation would negatively affect revenues by z∏.160,000 per year per store.

Czechs eye Polish workers An increasing number of Czech companies are offering employment to Poles, Gazeta Prawna has reported. Although salaries there are similar to those paid in Poland, Czech firms are enticing Poles by offering them bonuses and tax reliefs.

The majority of job offers are directed at Polish builders, marketing and finance specialists, and computer program mers. ●

4

NEWS

www.wbj.pl

Opinion surveys

MARCH 14-20, 2011

WikiLeaks

Polls give mixed messages Poland bullied by France?

Recent voter polls have been all over the place, with some putting opposition party Law and Justice (PiS) under two percentage points behind the ruling Civic Platform (PO) party.

Others, meanwhile, show PO with as much as a 17 percentage point advantage.

Why the huge disparity?

“I am radically skeptical of opinion polls and I think we pay too much attention to them. In fact we are now living in what I would call a pollocracy, which is a bit silly considering how often polls have been proven wrong on election day,” said Wawrzyniec Konarski, a political scientist at the Warsaw School of Social Sciences and Humanities.

Who to trust?

Recent poll numbers for Civic Platform, Law and Justice Civic Platform

Law and Justice

40 35 30 25 20 15 10 5 0 CBOS (March 3-9)

MillwardBrown SMG/KRC (March 6)

Homo Homini (March 4)

“Not knowing the methodology used, it’s even difficult to conclude which of them is more credible. What is clear is that PO’s image and efficiency is very much deteriorating, but on the other hand PiS is unprepared to govern as it is a doctrinaire party with no offer for most of the electorate,” added Mr Konarski.

Sergiusz Trzeciak, a political scientist at Collegium Civitas, was equally wary of putting too much emphasis on poll numbers.

“Seeing such huge differences in the poll numbers brings into question their research methods. The only thing that remains clear is that PO is still in the lead, but by how much, well, that is really difficult to judge,” said Mr Trzeciak.

Mr Trzeciak agreed with Mr Konarski that while many people were dissatisfied with the PO government, they seemed to see no alternative, saying this was especially the case among young people.

“After all the fuss over the pension reforms and all the criticism they have received from not only the opposition, but also from major opinion-makers, what is surprising is that PO still has so much support among Poles.”

Remi Adekoya

Source: Pollsters

Paris was willing to use strong-arm tactics to get its way A US diplomatic cable published by whistleblower website WikiLeaks shows that France allegedly threatened to block the Eastern Partnership, a European Union program to build ties with former Soviet states, unless relations with Russia were normalized.

The threat was made after dialogue between the EU and Russia broke down following the outbreak of war between Russia and Georgia in South Ossetia in 2008. Other cables released by WikiLeaks show that France was reluctant to criticize Russia during the crisis saying it would harm the work of its diplomats.

And it now appears France was prepared to play hardball in order to get relations with Russia back on track.

According to a cable from the US Embassy in Stockholm, Swedish diplomat Johan Frisell said France would stall the Eastern Partnership if “the Swedes and others opposed to business as usual” in relations with the Kremlin refused to resume EU-Russia talks.

Sweden and Poland are the chief architects of the Eastern

COURTESY OF WIKIMEDIA COMMONS

Civic Platform is still in the lead, but by how much?

Nicolas Sarkozy’s government apparently prizes the status quo with Russia Partnership.

“Once the decision on talks on the Partnership and Cooperation Agreement [with Russia] was made, Sweden and Poland ... were given the green light to ‘move ahead,’ Frisell told us,” the cable reads.

The willingness of major powers to ride roughshod over Poland in order to further their own aims was made even more clear by another cable released in early March.

Russia was apparently determined – no matter the strength of Poland’s opposition – to get the Nord Stream gas pipeline operational. Nord Stream will carry Russian gas to the EU via the Baltic Sea. The project is designed to give Russia direct access to

Western markets, bypassing Poland and giving Russia greater leverage in terms of gas politics. Poland has, unsurprisingly, been an outspoken critic of the project, with Foreign Minister Sikorski once comparing it to the MolotovRibbentrop pact – the 1939 deal between Russia and Germany to divide Poland in two.

Rejecting Poland’s opposition, however, Russian Ministry of Foreign Affairs European Cooperation Director Dmitry Polyanskiy told the US Embassy in Moscow that “Nord Stream is an EU priority and one EU member, even a large one like Poland, cannot hold it up,” the US Embassy in Russia wrote in a dispatch.

Gareth Price

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LISTED FIRMS

MARCH 14-20, 2011

Banking

PKO’s 2010 net profit rises 40%, beats forecast Its rival Pekao disappointed the market, but still turned a healthy profit Poland’s largest lender, the state-owned PKO Bank Polski, saw its 2010 net profit rise nearly 40 percent due to higher volumes and lower provisions for bad loans.

The bank booked a profit of z∏.3.22 billion for the year, benefiting from Poland’s strong economic growth last year. The lender’s result was slightly above the market’s expectations.

Chief executive Zbigniew Jagie∏∏o told the press that PKO could make a profit of z∏.4 billion this year, as long as the economy continues to grow at a healthy pace and costs from bad loans fall.

“The gross profit figure for 2010 [z∏.4.08 billion] may be the net profit for 2011,” he said.

In Q4 of 2010 the lender turned in an above-forecast net profit of z∏.867.8 million, compared to z∏.516 million generated in the same period a year earlier.

PKO’s board intends to

recommend a dividend of 40 percent of net profit.

Meanwhile, Bank Pekao, the country’s second-largest bank by assets and one of its more conservative lenders, saw less pronounced growth than many of its rivals in Q4.

It reported a below-forecast five percent rise in net profit for 2010 on weak loan growth. In total, the lender – a unit of Italy’s UniCredit – made z∏.2.53 billion.

Deputy chief executive Luigi Lovaglio said, however, that he expects Pekao’s net

profit to increase this year on cost control and loan growth.

The bank has proposed a dividend of z∏.1.78 billion on its 2010 takings.

On balance, Poland’s banking sector had a strong 2010 as the number of non-performing loans didn’t proliferate to levels feared at the start of the crisis. The country’s banking regulator, the Financial Supervision Authority, has estimated that banks’ combined net earnings in 2010 rose by 41 percent y/y to z∏.11.7 billion.

Natalia Kazik, Gareth Price

Tight at the top Annual consolidated net profits of PKO BP and Bank Pekao (in z∏. bln), 2007-2010 Pekao

PKO

4

3

2

1

zł. bln 2007

2008

2009

2010 Source: Pekao; PKO BP

Lotos sale delayed to avoid election season conflict?

Poland’s Treasury Ministry has once again extended the tender deadline for its sale of a controlling stake in Lotos, the country’s second-largest oil refiner.

The deadline had previously been delayed from February 4 to March 18.

The Treasury is attempting to offload a 53 percent stake, valued at around z∏.3 billion.

Spokesperson Piotr Koszewski said that the Treasury had now extended the deadline until April 29 at the request of potential investors. He did not add any further details.

However, analysts have said that the latest delay could have a political explanation. It will

likely push the sale itself into 2012 – after the parliamentary elections due this October.

“We have polls coming up, so it’s not the best time to carry out such a problematic deal from the political point of view,” said BRE Bank analyst Kamil Kliszcz.

According to Polish media sources, Russian oil companies interested in the asset – including Gazprom Neft, Rosneft and TNK-BP – are likely to offer the highest prices for Lotos. That could prove a tricky sell to an electorate that is touchy about Russian involvement in strategic Polish businesses.

“Lotos is a strategic compa-

ny. [Many] Polish people are afraid a Russian owner could destroy the value of Polish assets,” Mr Kliszcz explained.

The government has set tough conditions for the eventual buyer of the stake. The new owner must support Lotos with capital, new assets and industry know-how. At the same time, the refiner should be politically independent and its assets should remain located in Poland.

“If there is no progress in a year’s time, it’s likely the Treasury will [be forced to] sell some shares to institutional investors and retain control for itself,” said Mr Kliszcz. Gareth Price

ABS nets z∏.30.1 million Asseco Business Solutions (ABS), Asseco Poland’s business software subsidiary, booked a net profit of z∏.30.1 million for full year 2010. The figure marks a 34.2 percent rise on the company’s z∏.22.43 million profit in 2009.

Revenues from sales amounted to z∏.168.6 million in 2010, representing a 7.9 percent rise y/y.

Romuald Rutkowski, president of Asseco Business Solu-

tions, attributed the strong performance to the company’s development strategy. “We are continuously working on expanding our offer, upgrading the level of our services and maintaining long-term relationships with our clients.”

Mr Rutkowski also mentioned that, “Keeping strict cost discipline ... allows us to finance our undertakings exclusively from our own resources.”

Asked whether ABS intend-

ed to pay out dividends, Mr Rutkowski said that it was the company’s policy to pay out dividends which might even be as high as the year’s net profit.

“It has not been ruled out that this will be the case this year as well,” he added.

Last year the company paid out z∏.25.06 million in dividends, which constituted most of its 2009 net profit plus part of its net profit from previous Natalia Kazik years.

www.wbj.pl

5

6

INDUSTRY NEWS

www.wbj.pl

MARCH 14-20, 2011

Emissions

Gas supply

EC proposals upset Polish industry

Massive gas project secures financing

paper that tougher targets would lead to the faster “deindustrialization of Europe.”

At the same time, many Polish power stations are old and are currently being replaced. Hence, Kamil Kliszcz, an analyst at BRE Bank, said that there was great scope for improving energy efficiency and reducing CO2 emissions in Poland. He also said, however, that although “the efficiency potential is huge,” it was “not enough to meet such ambitious goals.”

Five banks have agreed to purchase bonds worth z∏.1.7 billion from GazSystem

Alexander Hayes

The EC wants to see harmful emissions cut drastically

Legal News Contact: Miros∏aw Stefanik ms@pnplaw.pl

New power efficiency provisions On March 4, the Sejm adopted the Act on Energy Efficiency. The new provisions are intended to improve efficiency in the energy industry and promote technologies which mitigate the industry’s influence on the environment. Power producers, distributors and users will be obliged to increase efficiency by nine percent in total by 2016.

Among other things, the act introduces the obligation to obtain power efficiency certificates, known as “white certificates”.

These “white certificates” will be issued by the head of Poland’s Energy Regulatory Office for those projects which lead to a reduction of power consumption.

The energy efficiency obligation will bind the private sector, even though the relevant European law provisions specify that it is the public administration who should serve as an example when it comes to reaching the required level of power savings.

The act is still being considered by the Senate.

New way to establish a limited liability country (sp. z o.o.)

At the end of February, the Sejm adopted changes to the Commercial Companies Code which are intended to speed up the process of establishing limited liability companies. The new legislation introduces a new means of registering a limited liability company – namely online registration on the basis of a special draft of articles of association (the draft will be

defined by the minister of justice).

This new method of registration will mean the end of the obligation to have a limited liability company’s articles of association drawn up in the form of a notarial deed. Articles of association will be concluded at the moment all data necessary have been fed into the IT system and after the data has been certified with an electronic signature.

Should a would-be entrepreneur decide that the draft of articles of association of a limited liability company does not suit his or her needs, he or she will be able to register a limited liability company in the traditional manner.

Two judgments referring to residential parking spaces On March 3, the Supreme Administrative Court passed two judgments concerning the VAT rate applicable to the sale of a parking space together with an apartment. In one judgment (court file no. I FSK 315/10), the Court decided that a developer might apply a decreased VAT rate if it is selling an apartment together with a car parking space located in an underground parking lot. The Court underlined that, in such a case, the parking space was not a separate object in terms of market trade.

In the other judgment (court file no. I FSK 97/10), the Court recognized that if a parking space was a separate real property and might be an object of trade separate from an apartment, then the sale of the parking space should be subject to the normal VAT rate. ●

BROUGHT TO YOU BY PETER NIELSEN & PARTNERS LAW OFFICE

Gaz-System, Poland’s natural gas infrastructure operator, has signed contracts with five major banks to secure financing for the first phase of a large-scale natural gas project.

As part of an agreement concluded last week, banks ING, Nordea, Pekao, Millennium and BRE will purchase bonds worth a total of z∏.1.7 billion from Gaz-System.

Along with Gaz-System’s own funds (z∏.3.6 billion), subsidies from the European Union (z∏.1.7 billion) and various additional loans, this will allow the operator to carry out a strategic development plan valued at z∏.8 billion.

The bonds will be sold in seven tranches between July 1, 2011, and December 20, 2014.

Justifying the decision to issue bonds, Jan Chadam, president of Gaz-System, stated that the move, “Would allow [the] company to complete strategic projects aimed at improving energy security in Poland, such as the expansion of the national industrial

COURTESTY OF GAZ-SYSTEM

The most cost-effective way to meet long-term emissions targets would be for member states to slash greenhouse gas emissions to 25 percent of 1990 levels by 2020, according to the European Commission.

The proposal is outlined in the EC’s just-published “Roadmap for moving to a competitive low carbon economy in 2050” report. The roadmap details a strategy for cutting member states’ emissions and states that they should be slashed by 80 percent from 1990 levels by 2050.

The official EU target for 2020 remains 20 percent of 1990 emissions levels, which is important for the Polish economy and its coal-dependent energy sector.

Nevertheless, power utilities have are already started estimating the cost of the proposals. Stanis∏aw Tokarski, the president of Tauron subsidiary PKE, told Parkiet, “According to our forecasts, from 2020-

2030 investment would have to reach z∏.13-15 billion a year, and then it would have to increase even more [to be compatible with the proposals].”

Tomasz Krukowski, an analyst at Deutsche Bank, agreed.

He dismissed the report as simply a set of proposals and pointed out that “the rest of the world is doing nothing.”

The plan has also divided EC policy makers. The EC’s energy commissioner, Günther Oettinger, opposes raising the 20 percent target. He told the UK’s Guardian news-

SHUTTERSTOCK

Poland is not yet ready to make drastic cuts, analysts agree

Poland’s energy security depends on more of this, says gas infrastructure operator Gaz-System network.”

Over the next four years, the length of Poland’s natural gas network will increase by 1,000 km. New pipelines will be built in southwest, central and northwest Poland, connecting the LNG terminal in ÂwinoujÊcie, on the Baltic coast, with the Czech natural gas network. This will be the first interconnector between the two networks.

Gaz-System will implement the investments in two stages. The first is due to be completed by 2014.

The north-south gas corridor will ultimately stretch from ÂwinoujÊcie to Adria in

Croatia and will increase Poland’s independence from Russian gas. The endeavor is part of a pan-European project, involving the EU, to eliminate “energy islands” – countries isolated from the Western European gas system – Deputy Treasury Minister Miko∏aj Budzanowski told Dziennik Gazeta Prawna.

The EU is helping to finance all major natural gas investments in Poland, including the construction of the LNG terminal in ÂwinoujÊcie, the development of pipeline infrastructure and the construction of the Polish-Czech NK, GP interconnector.

Polish mushroom producers conquering European markets Poland is the mushroom champion of Europe, in terms of production numbers. The country produced 250,000 metric tons of white mushrooms in 2010, more than any other European Union country, Krystian Szudyga, the president of the Association of Cultivated Mushroom Producers (SBGU) told the Polish Press Agency last week.

The figure marked a 15,000 ton increase on 2009’s production figures and constituted 25 percent of all white mushroom-

production in the EU last year.

In 2010 Poland exported more than 125,000 tons of mushrooms. The export of fresh mushrooms constituted around 80 percent of the total, with the remainder pickled or frozen.

Germany, the Netherlands, the UK and Balkan-region countries are among the largest importers, but, according to Mr Szudyga, Russia is the largest market for Polish production, having imported around 50,000

tons in 2010. This year exporters may also be targeting the US market with frozen products.

Although Poland excels in the production and export of mushrooms, it lags behind other countries in terms of consumption. In order to boost the consumption among Poles, the SBGU has organized a promotional campaign to educate Poles as to the benefits of white mushrooms.

Natalia Kazik

Jutrzenka looking to buy out Odra Polish confectioner Jutrzenka has announced its desire to purchase a 100 percent stake in Brzeg-based PWC Odra. The latter company is not keen on the idea, however.

Last December, Czes∏aw Greczyn, then Odra’s vice president, tried to sell Jutrzenka a 51 percent stake in the firm together with a group of other shareholders. The deal was blocked by the rest of Odra’s board, however, and Mr Greczyn was subsequently fired.

Nevertheless, Colian Investement, a firm belonging to Jan Kolaƒski (who also owns Jutrzenka), appears to have purchased around 17 percent of Odra’s stock.

“Mr Jan Kolaƒski will not be satisfied with the percentage [of shares] that he has. His vision is to be the future majority shareholder of Odra,” Cecylia Zdebik, Odra’s president, told Radio Opole.

She stated that if Jutrzenka took over her company, many

jobs would be cut and production would be stripped, leaving the firm to make just halva, a confectionery made from sesame seeds or nuts.

Beata Kolterman, a spokesperson for Colian investments, denied that Mr Kolaƒski wanted to strip Odra of its assets. “We want to invest in this company and grow it,” she told WBJ. When asked about possible job losses, she said it was too early to comment.

Alexander Hayes

COMPANY FOCUS

MARCH 14-20, 2011

www.wbj.pl

7

Consumer products and manufacturing

3M details its designs for Poland It’s hard not to notice the laboratories as you approach 3M Poland’s headquarters. Conspicuously visible behind the building’s glass facade, they are cluttered with all manner of tools, tapes and, naturally, Postit notes. Together with another pair of labs on the other side of the building, they serve as locations for testing products and giving demonstrations.

Emerging from one, S∏awomir Ponichtera, a technical service supervisor, explains that part of his job involves finding

3M by the numbers General director: Xavier Douellou Year established in Poland: 1991 Employees (full-time equivalents): 1,414 Manufacturing sites: 4 Investment in Poland 2001-2010: $255.5 million Planned investment in 2011: $60 million Main export categories: medical & health care; home-care cleaning products; abrasives

new uses for existing products.

A man in the corner of the room is carefully applying different kinds of tape to a plastic component. His task, S∏awomir says, is to determine which one sticks best.

In the next room, Wojciech Âlaski, a technical service specialist, offers a breathy history of reflective sheeting materials for traffic signs. He almost makes it sound interesting. The same room is littered with signage bearing the logos of some of Poland’s biggest banks and restaurant chains.

“Prototypes for tenders,” says Mr Âlaski. “Some are clients now. Some aren’t,” he notes with a shrug.

Growth ambitions It may not win every tender, but, judging by its financial results, 3M Poland probably wins more than it loses. The firm, which makes tens of thousands of products, had a compound annual growth rate for sales revenues of 22.9 percent over the 2005-2009 period. In 2010, meanwhile, sales rev-

COURTESY OF 3M

The multinational conglomerate will invest $60 million in the country this year

Mr Douellou wants to manufacture 70 percent of 3M’s CEE-market products in Poland enues hit z∏.1.3 billion, a figure up around 39 percent on the year before.

Xavier Douellou, 3M Poland’s general manager, admits the firm saw some sales compression during the financial crisis, but says that it experienced annual growth throughout the period. He credits this to investments in manufacturing operations, which helped to generate new B2B sales.

At present, 3M has six production facilities in the country (one each in Janinów and Rabka, and four in Wroc∏aw) all with a different focus. Further investments are in the pipeline,

with two more facilities to open in Wroc∏aw, dedicated to automotive and aerospace products, respectively. The $60 million 3M intends to invest in Poland this year will be primarily spent on the latter facility.

These investments are in line with the company’s plan to manufacture 70 percent of its CEE-market products in Poland. According to Mr Douellou, the current figure is “60-65 percent” and it’s “definitely going in the right direction.”

The firm’s expansion plans aren’t limited to organic growth, either. Mr Douellou

stated that M&A targets in different sectors are constantly being evaluated and prioritized in terms of their potential value to 3M. “There are five to six sectors which we’ve identified and in which we have some potential M&A cooking,” he noted.

Though he declined to elaborate on which sectors these might be, Mr Douellou did say that some purchases could be in the offing.

“Some [targets are] for immediate action, some for medium-to-long-term action … so, for 2011-2013 we may make some.”

Innovating in Poland Given its ambitious expansion

plans, it’s perhaps unsurprising that 3M is also broadening the focus of its Polish R&D activities from just manufacturing support to include product development as well. This shift began last year.

“It’s a plan for the next two to three years, where we’re going to invest more in product development. And we expect to have an output of more and more patents to be filed,” Mr Douellou stated.

No doubt new products will find their way to the labs in 3M’s headquarters. In other words, S∏awomir Ponichtera and his colleague could soon be testing adhesives designed elsewhere in Poland, rather than E Blake Berry abroad.

Steady sales Sales revenues for 3M Poland (in z∏oty mln), 2005-2010 1500 1250 1000 750 500 250 zł. mln 2005

2006

2007

2008

2009

2010 Source: 3M Poland

A guide to Polish business and industry

Przewodnik po polskim biznesie i gospodarce

The 2011 edition of book of lists is now available!

• Find key information about the dominant players in the market • Expand your portfolio of contacts • See who’s on top of your sector

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8

COVER STORY

www.wbj.pl

MARCH 14-20, 2011

Credit unions

Ripe for regulation Scared during the global financial crisis that a growing network of credit unions escaping public control could prove the financial system’s Achilles’ heel, the Civic Platform government decided that the time for self-regulation had passed.

In November 2009 it drafted an amendment to the law regulating credit unions, which would have put them under the control of the national Financial Supervision Authority (KNF).

Credit unions countered that the proposed law could severely destabilize them. Late President Lech Kaczyƒski sent the law to the Constitutional Tribunal one month later, where it still awaits review.

No date has been set for the Tribunal’s decision, but the government is moving ahead anyway. The Finance Ministry has officially requested the European Central Bank’s opinion and the KNF has asked the World Bank for a

comprehensive report on the set of regulations that will eventually accompany the law.

The debate is on.

Need for regulation Having appeared in the market in 1992, credit unions (called “SKOKs” in Poland) have to date remained self-

see larger amounts of capital and liquidity, as well as higher risk management.

The government, the IMF, the European Central Bank, the World Bank and even the SKOKs themselves agree that the time has come for the Financial Supervision Authority to oversee Polish credit unions. President Bronis∏aw Komorowski also demonstrated his support for KNF supervision by withdrawing his pre-

“The question then, seems to be not whether SKOKs should be regulated, but how” regulated. The Polish National Association of Co-operative Savings and Credit Unions (NASCU), a body composed of SKOK managers, acts as the national supervisory authority.

While self-regulation is generally considered the norm in the early stages of credit union systems, more sophisticated supervision is needed to over-

supervision and regulation of Polish credit unions.

“Some SKOKs are bigger than banks and they offer a wide range of banking services, so it’s logical they should operate in a similar legal framework,” said ¸ukasz Dajnowicz, a spokesperson on capital markets at the KNF. Poland’s largest credit union, SKOK Stefczyka, has 350 branches and 670,000 members, and manages around one third of the total sector’s assets. In such cases, SKOKs have effectively become competitors for commercial banks.

So far, so good?

decessor’s objection to this specific part of the law on credit unions.

“We think SKOKs are ripe for strengthened supervision, a view we have held for a number of years,” said Marcin Piatkowski, a senior economist at the World Bank, who coauthored a recent report which details proposals for the

Wiktor Kamiƒski, vice president of the NASCU, also agreed that Polish credit unions have grown to a level where state authorities can no longer leave them outside of public supervision.

However, he also argued that the matter was not pressing. “There is really no hurry, and we can assure any authorities and the public that the situation of credit unions is sta-

Credit unions in context Credit unions provide credit as well as other financial services, but unlike regular banks, they cater only to members and individuals. They are generally service- and community-oriented rather than profit-oriented, and target low- and middle-income individuals, families and entrepreneurs.

Given this approach and their members’ relatively modest assets, credit unions might seem like small fry, but their large memberships and important role in countering financial exclusion mean they are significant players in most developed countries’ economies.

According to the World Council of Credit Unions (WOCCU), credit unions serve an estimated 857 million people worldwide and have total assets of over $1.1 trillion. In Canada, credit unions’ assets are equivalent to as much as 17 percent of GDP. That is an exceptionally high figure, but credit unions’ assets in Ireland and the US still equal 6.4 and 8.8 percent of GDP, respectively.

Credit unions in Poland, known as “SKOKs,” oversee z∏.14 billion in assets,

or around one percent of GDP. They service 2.2 million members. SKOKs calculate that they cater to around 15 percent of the Polish workforce and that, assuming one member per household, they reach between six to eight million beneficiaries.

This is a unique achievement in Central and Eastern Europe. Only Ukrainian credit unions have more members, but they manage much smaller assets.

“Elsewhere in the region credit unions have not really developed,” said Marcin Piatkowski, senior economist at the World Bank’s office in Warsaw. “For instance, in Romania there are only slightly more than 70,000 credit union members and in the Czech Republic, Slovakia and Hungary, there is hardly any credit union movement to speak of.”

Even in Europe as a whole, only Irish credit unions oversee greater assets.

Polish credit unions are also breaking records globally; their growth since being created in 1992 has been the most dynamic worldwide, according to the WOCCU. In the last five years, SKOKs

have grown at an average rate above 20 percent per year.

“From 2006 to 2011, total assets of credit unions doubled and in the near future, we can expect they will grow and develop as fast as in the past,” said Szymon Syp, an associate at the Domaƒski Zakrewski Palinka law firm and a Ph.D. candidate at the Warsaw School of Economics.

SKOKs started by serving members of the country’s major industries and specific professions such as the police and teachers. They evolved along with the Polish economy and now offer sophisticated banking services such as deposits, loans, payment and insurance services, debit cards, current accounts and internet banking. They also run one of the country’s largest ATM networks.

They especially target Poles who do not have accounts with other banks, a demographic estimated at about 20 percent of the population. At the same time, SKOKs say that demand for their services is growing among younger Poles. ●

Polish unionity European credit unions by number of members and size of assets, 2009 Country

Members

Assets

Belarus

1,047

$676,620

3,019

$16 million

Estonia Great Britain Ireland

788,257

$1 billion

2,955,000

$20 billion

Latvia

25,194

$20 million

Lithuania

102,403

$366 million

Macedonia Moldova Poland Romania

7,628

$6 million

124,139

$30 million

2,026,120

$4 billion

71,458

$48 million

Russia

207,710

$162 million

Ukraine

2,190,000

$532 million Source: World Council of Credit Unions

ble,” he said.

SKOKs weathered the financial crisis rather well. As Mr Kamiƒski pointed out, the World Bank confirmed in its recent report that credit unions saw no turbulence during the crisis, suffered no bankruptcies, did not ask for any public support, and closed 2010 with a growth in assets and in net income.

“So far, so good,” agreed Mr Piatkowski. But his report for the World Bank also noted that the SKOKs’ growth in assets during the crisis came at the cost of lower capital and lower financial stability.

One such factor of instability is a rising share of non-performing loans, which almost doubled in value between 2008 and 2009, from z∏.1.1 billion to z∏.1.9 billion. They now account for 13 percent of all loans, which is considered high by international standards and amounts to double the ratio found in the regular Polish banking system. Meanwhile, provisions for non-performing

loans have decreased, and the World Bank warns that they might not be sufficient to cover all potential losses.

Even this data is uncertain, as it is provided by SKOKs themselves, who do not apply the same accounting standards as other financial institutions and do not perform independent financial audits.

“The system is currently not transparent enough to evaluate the risks,” the KNF’s ¸ukasz Dajnowicz stated bluntly. Meanwhile, the World Bank’s report did not reveal the quality of the financial data provided by SKOKs, a concern expressed by some market participants.

What lies at the heart of the problem? Mr Piatkowski explained that there were no specific examples of conflict of interest to speak of, but rather a problem inherent to the nature of the self-supervision model.

For example, due to their structure, SKOKs might lack incentive to build up sufficient

Growing in numbers Poland's credit unions – number of branches and members (in thousands), 1992 to H1 2010 2,500 Number of branches 2,000 Number of members 1,500 1,000 500 0

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 H1 2010

Credit unions in Poland are growing faster than anywhere else in the world. It’s time to regulate them, but finding a solution is proving difficult

Alice Trudelle

Source: GUS

COVER STORY

MARCH 14-20, 2011

9

Legal Eye

capital and thus ensure that they can absorb a reasonable amount of loss. Currently SKOK capital ratios stand at around three percent, while the new law is set to establish a five percent minimum. The World Bank estimates that both are considerably below international standards, and it suggests a minimum of eight percent of total assets to enhance individual and systemic stability among credit unions.

For the government’s part, the worry is that a shock to the SKOK system could have a substantial impact on confidence in the whole banking sector, a concern heightened by fears that customers do not necessarily differentiate between self-regulated SKOKs and fully regulated banks.

Who’s minding the other bank?

Paul Fogo is a senior attorney with Miller, Canfield, W. Babicki, A. Chelchowski & Partners. fogo@pl.millercanfield.com

COURTESY OF WIKIMEDIA COMMONS

During the past year the European Central Bank has issued two formal opinions in support of the Polish government’s attempt to exert greater regulatory control over credit unions. To date, however, neither of the two proposed pieces of legislation has become law.

A thorny issue The question then, seems to be not whether SKOKs should be regulated, but how. And it turns out to be highly politicized.

The NASCU’s Wiktor Kamiƒski explained that tensions between thriving credit unions and the banking sector tend to be a global phenomenon.

In today’s Poland, although SKOKs are not officially affiliated with any political party, the conflict has migrated into the political realm, with Civic Platform, the pro-business governing party, on one side and Law and Justice, the largest opposition party, on the other.

In 2009, the conflict crystallized around Civic Platform’s proposal to change the credit union law. The SKOKs and a delegation from the World Council of Credit Unions said that the proposed law was drafted with the advice of the banking sector, and has the potential to destabilize or even destroy the whole credit-union

What’s the fuss?

The largest credit unions, like SKOK Stefczyka, are bigger than some banks system. They also argued that it was largely unconstitutional.

Former President Lech Kaczyƒski, a co-founder of Law and Justice and a longtime supporter of credit unions, referred the law to the Constitutional Tribunal in December 2009, where it still awaits review.

All the people interviewed for this article underlined that the Constitutional Tribunal was a pillar of Polish democracy and that it must be allowed to conduct its work without undue pressure or hurry. Work might begin in the fall and it has been postulated that, if approved, the law might be adopted within 60 days of the Tribunal’s decision.

Meanwhile, the government has decided to move ahead with preparations. The

Finance Ministry requested the ECB’s opinion on the law in January. ECB president Jean-Claude Trichet’s answer, when it came in mid-February, was unequivocal.

“The ECB considers it essential for the legal reform of the regulation and supervision of SKOK credit unions to enter into force as soon as possible. Key elements are the imposition of a supervisory regime equivalent to that applying to credit institutions, the obligation to hold minimum reserves and enhanced legal certainty and transparency of credit union operations,” read the official statement signed by Mr Trichet.

The World Bank’s assessment, requested by the KNF, was published in February.

The report also unequivocally

stated that the SKOKs’ current situation was a subject for concern and that they should be supervised by the KNF. But it also said that aspects of the proposed law were unclear, notably regarding the role that the NASCU and the KNF should play in supervising the SKOK system. It also called for a comprehensive set of secondary regulations and an adequate transition period to ensure that, among other things, the future development of credit unions would not be hindered.

While resistance should be expected, the KNF should be persistent and deal “openly and honestly” with SKOKs, advises the World Bank. After all, “changes have been put forth to protect the members’ savings and the system as a whole.” ●

Credit unions at a glance Breakdown of SKOK loans and investments, March 2010 Types of loans

Types of investments

1.03% 2.57% Small business loans

11.88%

0.74% Money market funds

20.53% Consumer loans

27.21%

KSKO-K deposits Residential credit

8.69%

www.wbj.pl

Bank deposits

60.5% Home improvement loans

66.85%

Government securities

Other loans and credit Source: World Bank

Current law places regulatory authority over credit unions beyond the control of the Polish government.

Specifically, credit unions are not deemed to be banks, and therefore are not subject to the control of the KNF, which is charged with regulating the banking sector in Poland.

At present credit unions are self-regulated by a board of directors selected from among member credit unions. In November 2009, the Polish parliament adopted a new law that would bring credit unions within the control of the KNF. The president at the time, the late Lech Kaczyƒski, refused to sign the legislation into law and instead referred it to the Constitutional Tribunal for review. And there it has sat for more than a year.

The second piece of legislation concerns the extension of financial guarantees by the National Bank of Poland to credit unions.

cuting financial transactions.

Credit unions are not permitted to grant residential mortgages per se, but are able to grant loans for residential purposes for up to five years.

Credit union customer deposits are not guaranteed

by Poland’s Bank Guarantee Fund, but instead are insured separately by the credit unions themselves for up to €50,000.

Proposed changes The new legislation, if finally enacted into law as expected, will not only bring credit unions under the direct control of the KNF. Other changes include the imposition of a minimum reserve requirement similar to, or even higher than that required for banks. At present no reserve requirement exists. Unlike a bank, however, this amount will not have to be deposited with the National Bank of Poland, but rather will be placed in a stabilization fund for all credit unions.

Other changes envisioned by the draft law include the right of the KNF to license newly established credit unions, the right to conduct on-site audits and the obligation for a credit union to transform into a bank upon reaching a certain level of assets.

What is a credit union?

Outlook

At present credit unions are subject to the Act on Credit Unions & Savings Co-operatives. In contrast to a bank, a credit union is not a jointstock company, nor may it operate for profit.

A credit union is made up of individual members belonging to a particular trade or professional organization. A credit union may only provide services to its members. Services include the collection of deposits, payment of interest on savings, granting loans and exe-

Most likely the Constitutional Tribunal will rule on the pending law in the near future, especially in light of the current president’s decision to withdraw the primary objection cited by the former president in referring the matter to the Court, that being direct government control over the credit unions by the KNF. By dropping this objection, the president has signaled his intent to sign the legislation into law if and when approved by the Tribunal. ●

Source: World Bank

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10

OPINION

www.wbj.pl

MARCH 14-20, 2011

The economics of diplomacy T

his week Foreign Minister Rados∏aw Sikorski will give his annual address on the state of Polish foreign policy. The speech offers a prime opportunity to reflect on the achievements and failures of the previous year.

In last year’s address, Mr Sikorski said the country’s strategic goal was to “play an increasingly important role in the European Union and NATO” and to see the values, norms and standards of Western civilization present “not only to [Poland’s] west, but to [its] east as well.”

He noted the formulation of road maps leading to visa-free travel for citizens of the Eastern Partnership countries (Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine), as well as Russia and the Western Balkans.

Mr Sikorski ended his speech on the topic of Polish-US relations, saying Warsaw was seeking a stronger US military, economic, technological and intellectual presence in Poland. He emphasized the expected deployment of American Patriot missiles as a step towards achieving this goal.

The ‘potted plant’ dilemma The latter proved something of a fiasco, with Poland receiving a Patriot training battery bereft of live ammunition. They were described by one diplomat as “potted plants,” the WikiLeaks cables revealed.

It is difficult to blame Polish diplomacy for what was ultimately an American decision. But Poland can certainly be blamed for allowing ambiguous wording in bilateral agreements, leaving the US free to interpret the deal as it liked.

On the positive side, Polish President Bronis∏aw Komorowski secured a promise from his US counterpart that American F-16s, along with American military personnel, would be stationed in Poland. If the deal materializes, it will be a step towards the closer ties Poland is seeking with the US.

On the eastern front Visa-free travel for the Eastern Partnership countries and Russia is not yet a reality and Poland’s Belarus policy has completely failed.

Mr Sikorski spent a lot of political capital convincing his German counterpart to join him in a visit to Minsk

before Belarus’ December presidential elections. Aleksander Lukashenko, often dubbed Europe’s last dictator, was offered economic and political incentives if he conducted free and fair elections. This backfired as Mr

“As long as the Polish economy continues to grow dynamically, so too will Poland’s geo-political clout” Lukashenko cracked down hard on the opposition, crushing protests against the rigged elections.

Poland then did an about-face, becoming one of the strongest voices calling for sanctions on Belarus. The EU later adopted many of these sanctions, but concrete results have yet to appear.

Turning to Ukraine, 2011 saw President Viktor Yanukovych’s first visit to Poland, despite his having been in office for over a year. Polish-Ukrainian relations are definitely cooler today than they were under previous

President Viktor Yushchenko. The fact that Mr Yanukovych waited so long to visit Warsaw makes this very clear – his predecessors generally visited Poland within a few months of taking office. Even so – and despite the visit’s lack of results – it was a step in the right direction.

And Poland’s goal of “playing an increasingly important role in the European Union and NATO?” This seems to have been achieved, with no little help from the country’s strong economic growth and its good relations with Germany. And when Mr Sikorski was in Washington this month, US Secretary of State Hillary Clinton offered just enough praise as to acknowledge Poland’s increasing global clout.

Growing clout When it comes to the trickiest bit for Polish foreign policy – relations with Russia – the results have also been largely positive.

Last year, Russian PM Vladimir Putin attended a memorial in Katyƒ along with Polish PM Donald Tusk.

Mr Putin acknowledged that “crimes” had been committed against Polish

officers during World War II. This was a major shift, at least rhetorically, on the Russian side.

The tragic death of President Lech Kaczyƒski and 95 others in Smolensk, Russia, complicated relations. It initially brought Poles and Russians closer together, but inquests into the accident have since strained the two country’s ties.

The government has had to walk a fine line between looking tough for its domestic audience and not aggravating tension with Moscow to the point where relations cool once again. Mr Tusk and Mr Sikorski have done a relatively good job, so far.

So, has Poland’s international stature grown since Mr Sikorski’s last address? It most certainly has.

However, this has less to do with the foreign minister’s Oxford-English and cosmopolitan manners than with the country’s economic strength. As long as the Polish economy continues to grow dynamically, so too will Poland’s geo-political clout.

All the more reason to devote more foreign policy in 2011 to building economic ties with other nations.

Take note, Mr Sikorski. ●

The top and the jigsaw puzzle Joanna Wóycicka

O

ne of the most common traditional toys in Poland is the wooden spinning top. Spun the right way it whirls around mindlessly, entertaining children but offering no intellectual edification.

This humble toy recently raised a few eyebrows when it was chosen to serve as official merchandise for the Polish presidency of the EU Council in the second half of 2011. Perhaps it was chosen for its simplicity, some have suggested, and as a reflection of how the government expected its tenure at the helm of the EU Council would be.

The agenda was set – not too ambitious, yet plenty to do. And speculation had it that the Polish presidency would strengthen the ruling Civic Platform (PO) party’s already healthy position before this autumn’s parliamentary elections.

Poles are very aware of internation-

al perceptions of their country, as well as commentary regarding their leaders’ activities. If the Polish presidency were to pass as planned, without hiccups, then the ruling party would be in a great position to gloat.

The media would be full of pictures of government politicians in the salons of Europe and the world, and proud Poles might be more willing to vote for Civic Platform and its coalition partner the Polish People’s Party.

All the government would need to do would be to show up and spin the proverbial top.

Jigsaw puzzles But the events in North Africa have turned plans for the Polish presidency upside down. The unrest in the south – as well as the threat of chaos spilling over into other countries – will color the EU’s diplomacy for the rest of the

year, if not longer. There are humanitarian catastrophes to deal with and a tide of refugees washing up along the bloc’s southern shores.

Indeed, the situation will have economic consequences for the whole world, many of which cannot be foreseen.

The Polish agenda has necessarily been upset and this will be an especially challenging and unpredictable presidency, one spent improvising. Poland’s successors may face the same challenge.

On the domestic front, the opposition may be able to parlay a difficult presidency into electoral gains.

All of this awaits the Polish government during its presidency. With all these irregular, ill-fitting pieces to deal with, perhaps the jigsaw puzzle is a more appropriate symbol for the Polish presidency than the top.

The South instead of the East The government could yet salvage the situation, at least in part. The centerpiece of the Polish presidency, according to the official agenda, is an Eastern Partnership summit scheduled for this autumn in Warsaw.

The Partnership, a Polish-Swedish project, is the first initiative introduced into the European Union’s newly formed External Action Service. Its goal is to deepen ties between the EU and Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine.

This Warsaw summit was to have been a chance to show off the Civic Platform government’s skill on the international stage and to demonstrate how far the country has come since its period of marginalization during the bellicose Law & Justice government of 2005-2007.

The chance to score points internationally is slim now, but if the government at least manages to hold the summit as planned it could win favor at home. In the international arena, the Polish presidency will be mainly judged on how it copes with the effects of the crisis in the south.

For Warsaw, the situation in North Africa has remained relatively abstract, much in the same way the issue of free speech in Belarus has been for, say, the politicians in Madrid. But this can be reconciled – by making the south the priority during its presidency, Poland also wins support for its Eastern Partnership.

This would benefit all involved.

Moreover, one of the most important lessons we should learn from North Africa is the importance of building the European neighborhood – in all directions. ●

Unless otherwise noted, the opinions here are those of Warsaw Business Journal.

Readers’ comments, opinions and letters should be sent to editor@wbj.pl. Please include a name and contact information and clearly indicate if they are to be considered for publication.

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E-tailing, luxury goods and spas – WBJ takes a look at the companies and trend shaping these and other areas of the cosmetics industry

POLAND’S COSMETICS INDUSTRY W a r s a w B u s i n e s s J o u r n a l ’s s p e c i a l s u p p l e m e n t o n c o s m e t i c s t re n d s

•

MARCH 14-20, 2011

E-tail and cosmetics

Beauty in the eye of the internet Poland’s beauty and cosmetics industry might be among the biggest beneficiaries of the recent groupbuying trend Deal-of-the-day websites are the latest craze in the Polish etail market. And the people most likely to make use of such sites are precisely the target demographic for the beauty industry.

The concept is simple. A company proposes a deal, which is advertised for free on a deal-of-the-day website. If enough people buy it, then the company and the website split the gains. If not enough people sign up, the deal is off, clients are refunded and the company offering the deal walks away with at least a bit of free publicity.

Groupon.pl, the Polish subsidiary of the eponymous American company, opened in April 2010. As of last November it was already in third place in the Polish e-commerce mar-

the parent company shows that the typical client of Groupon is a young woman, single, educated and earning a middle-tohigh income salary. Statistics for Poland are not available, but according to Mr Krawiec, they should not differ significantly.

“Women are much better online customers than men,” he said. “They constitute 60 percent of online buyers in Poland and are more loyal clients than men.”

by promoting services through Groupon was highest among spas and salons, while restaurants seemed to fare the worst.

This, according to the research, is because restaurants get more deal seekers who are unlikely to buy more than the coupon value or to become repeat users. Spas and salons, meanwhile, are well placed to offer multiple products and/or repeated visits.

Local notoriety Beauty before belly

Offers from the beauty industry feature prominently on deal-of-the-day websites ket, in terms of real users (2.6 million), according to research

by Megapanel PBI/Gemius In January, Groupon.pl estimates that it sold an average of 5,000 to 6,000 vouchers per day in January.

Targeting the ladies Smaller sites like Gruper.pl,

Mydeal.pl, Fastdeal.pl and others have also appeared in the market and online auction champion Allegro launched a competitor, Citeam.pl, in February. It hopes to overtake Groupon in this segment within a year.

“I am not sure if Citeam will overtake Groupon in just

one year, although considering Allegro’s 11 million regular users it could be possible,” said Piotr Krawiec, CEO of PR and marketing agency Praktycy.com. “Online group buying is definitely a new and successful trend in the Polish market,” he admitted.

Market research done for

Although deal-of-the-day websites offer a vast range of products, such as deals on classes, restaurant meals and clothes, the focus has tended to be largely on products and services from the health, fitness and beauty industries. Hair salons, spas, depilation and cosmetic dentistry have proven particularly popular in Poland.

Those are also the offers that tend to be the most beneficial for businesses.

A recent study from William Marsh Rice University found that the profit brought

Deal-of-the-day websites usually have very good sales departments, explained Sylwester Kozak, publisher and owner of e-biznes.pl, one of the best-established websites dedicated to Polish e-commerce.

“I bet that they have already visited almost every restaurant and spa in Poland’s biggest cities,” he said.

Small and local businesses tend to have the most to gain from the publicity and wordof-mouth, often via social networks such as Facebook Continued on p. 15 ➡

Luxury products

Sales of luxury cosmetics are on the rise in Poland The cosmetics industry, like few others, is so closely associated with the ideals of beauty as to be (for some consumers) synonymous with them.

Make-up, skincare products, spa treatments – these are among the tools of the trade for actors, models and other professionals for whom physical beauty is a job requirement.

For the rest of the market, these products may not be a necessity, but they are prized as status symbols.

Yet, as the adage goes, beauty has its price. High-end cosmetics are priced accordingly, and the Polish market is no exception to the rule.

On the top shelf The luxury cosmetics market in Poland is still small by European standards but it’s growing. According to data cited by Polish daily Rzeczpospolita, its

value stood at just z∏.800 million in 2008. Estimates for 2010, meanwhile, hover around z∏.1 billion and growth forecasts amount to around four to five percent.

In terms of international cosmetics producers, most of the usual suspects are present in the Polish market. Domestic companies are also strong in the sector though, and have carefully crafted their brand images through locally targeted ad campaigns.

Oceanic, for example, has employed popular singer Kayah to endorse its AA Prestige brand. Anna-Maria Jopek, another well-known singer, has served as the face of Dax Cosmetics’ Yoskine brand. For its part, Dr. Irena Eris has chosen actress and model Izabella Scorupco to represent its brand.

“These days, advertising with the image of a famous person is without doubt an important way of promoting a brand; however, when

deciding to advertise using such an endorsement, it should not be forgotten that the fame and success of a model or actress does not translate directly on to the product they advertise,” cautioned Eris’ Magdalena Górska-Rudzka, a PR specialist at Dr. Irena Eris.

Justifying the price Dr. Irena Eris has followed its own advice. Despite its use of Ms Scorupco, much of the company’s marketing efforts stress the R&D side of the business.

“We are the one producer in Poland, and one of the very few in Europe and indeed the world, to have our own centre for science and research, where we carry out tests in vitro, ex vivo and in vivo, which is exceptional in terms of the cosmetics industry,” Ms Górska-Rudzka stated.

Her firm’s R&D center has created products such as the Telomeric 60+ range of facial

care creams. And putting an emphasis on technical advancement is one way for it, or any cosmetics firm, to justify a luxury price point for its products.

Another is to appeal to older consumers, as they are statistically more likely to be able to afford high-end goods.

This strategy makes sense in Poland, as the market is greying, and all of the country’s major cosmetics firms have developed products to meet demand. These include Eris’ Telomeric brand, Oceanic’s AA Prestige 50+ product line and items within Dax Cosmetics’ Yoskine range.

COURTESY OF PURE PRESTIGE

Top-shelf glamor, at a price

Singer Kayah has endorsed Oceanic’s AA Prestige brand The growth of luxury Consumer spending power, even among the older members of society, is certainly lower than in Western Europe.

But Poland has come a long way in the 20 years since communism ended.

Its luxury cosmetics market is growing at a respectable

clip, and will not only be fueled by growing affluence and demographic shifts, but also by concurrent trends such as the growing popularity of spa services and the explosion of online sales (see other articles in this supplement).

Brendan Melck

In this supplement Online sales . . . . . . . . . . . . . . . . .11, 15 Luxury cosmetics . . . . . . . . . . . . . . . .11 Skincare products . . . . . . . . . . . . . . .14 Spas . . . . . . . . . . . . . . . . . . . . . . . . . . .15 Cosmetics for men . . . . . . . . . . . . . .15

OCEANIC Factory, Trąbki Małe near Gdańsk

Consistency, exceptional philosophy, the wise strategy of implementation of new products and, most of all, top quality standards are the factors responsible for the international success of the AA brand. OCEANIC S.A., a joint-stock company in whose laboratories these unique cosmetics are produced, has been present on the Polish market for 29 years.

Owned by Dorota and Wojciech Soszyńscy, Oceanic was established in 1982. At the beginning of the 1990s it developed a famous semi-rich cream from the “orange” line for allergy sufferers.

Since that time the company has developed dynamically, owing its success to the consistent strategy of development of cosmetics for persons with a sensitive and allergy-prone skin.

The year 2004 is a milestone in the history of the company due to the opening of a new factory meeting the highest safety standards in Trąbki Małe near Gdańsk. Together with a laboratory and a logistic & distribution centre, the factory occupies 12,000 sq. m. It is situated within an ecologically clean zone in a 4 ha area of land. It is the only Polish cosmetics factory where pharmaceutical GMP (Good Manufacturing Practice) standards were implemented. Those standards are attested by a certificate and guarantee the top quality which is the priority of the company.

The laboratory and two halls where pharmaceutical and face/ body care products are manufactured are provided with state-ofthe-art equipment and comply with top standards of hygiene and safety. Production is automated and all operations are supervised by top-class specialists. Each process is recorded, which eliminates the risk of error and ensures full production control. In 2009 a logistic & distribution centre was put to use and a SAP Enterpise Resource Planning system expanded with a quality management module was implemented.

Research concerning the implementation of new products is a key part of activities carried out by OCEANIC S.A. It is conducted in a scientific research laboratory which is one of the most modern facilities of this kind in Poland. The company lays great emphasis on research, new technologies and investments, e.g. in specialistic equipment. The laboratory employs 30 outstanding specialists, including dermatologists, pharmacists, biotechnologists, microbiologists, chemists and cosmetologists.

For ensuring the highest safety of AA products, each cosmetic smetic and dermocosmetic line is subjected to a detailed allergorgological test process using the patch test method in the Allergological Laboratory of the Dermatological Clinic of the Medical University of Gdańsk.

These detailed tests with the participation of patients with ha sensitive and allergy-prone skin contrast OCEANIC S.A. with other producers.

THE COMPANY’S OFFER CAN BE DIVIDED INTO 5 CATEGORIES OF PRODUCTS: AA COSMETICS – antiallergic mass market cosmetics designed for care of the sensitive face and body skin in every age AA PRESTIGE – exclusive, technologically advanced antiallergic cosmetics for care of the face and body skin AA ECO - complementary line of ecological cosmetics for face and body care developed for people with sensitive skin prone to allergies.

AA PRESTIGE INSTITUTE – professional treatments and cosmetics designed for SPA centres and beauty salons AA THERAPY & AA PHARMACEUTIC – dermocosmetics, i.e. medicinal products developed for persons suffering from diseases such as atopic dermatitis or diabetes.

With a 10% market share in the face care cosmetics category, the AA brand is one of the leaders of the Polish cosmetic industry.

AA cosmetics are also exported to 27 foreign countries. The biggest export markets are European markets, such as Slovakia, Hungary, Lithuania and Belarus, and the USA. There is a very dynamic sales increase in the Ukraine and Russia, and the AA brand is also present in South Korea, Georgia, Armenia and the Lebanon.

The cosmetic lines that are the most popular abroad include antiwrinkle AA PRESTIGE lines (AA Prestige Age Corrector Concentrate 40 +, AA Prestige Morpho Creator) and AA lines (AA DNA Regeneration, AA Intensive Lifting, AA Sensitive Skin, AA Intimate Product line). Other products that are highly appreciated by foreign customers include specialistic dermocosmetics designed for specific skin s problems, such as AA Therapy Acne products for oily and acne-prone skin care, AA Therapy skin care products prod for diabetics or Oillan products addressed to children child and adults with an atopic skin.

OCEANIC OCE S.A. intends to develop its export in the future.

In the th next few years, the company will focus mainly on expansion expa to markets of North Africa, the Far East and the Middle East. The aim and ambition of OCEANIC S.A. is to turn AA into a brand of global reach.

14

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POLAND’S COSMETICS INDUSTRY

MARCH 14-20, 2011

Skincare products

Soft skin, tough markets Skincare products constitute a major element of the cosmetics industry and the Polish market is no different than any other in this respect. Unlike many smaller national markets, however, there is a healthy mix of international and domestic firms competing for consumers’ loyalty.

According to market intelligence firm MEMRB, the top three firms in the Polish skincare products industry are Germany’s Nivea, French giant L’Oreal and Ziaja, a homegrown firm. During the first 10 months of 2010, Ziaja was in second place, behind Nivea, in terms of sales volumes and third in terms of value.

The rest of the top 10 in the skincare sector comprise a number of other Polish firms, including Dr. Irena Eris and Oceanic (which markets the AA range of products).

Another firm on the list is Soraya, which is owned by Sweden’s Cederroth but

the economic crisis without great hardship. Indeed, sales in 2009 were up 12 percent y/y in terms of value and seven percent in terms of volume.

Some observers put this down to the “lipstick effect,” which posits that consumers turn to less expensive luxury goods during a financial crisis.

Last year saw more modest growth. MEMRB’s figures put the annual growth in terms of both value and volume at just three percent. This could be due to a high base effect, a delayed impact from the eco-

nomic slowdown or a combination of factors.

Whatever the reason, there seems to be greater price consciousness in the market.

“In Poland, there is a need for differentiated pricing of cosmetics – there are consumers who are ments, but some firms have stronger mid-market portfolios than others.

Serving foreign markets

SH UT TE RS TO CK

Polish companies are recently acquired Polish firm well represented in the Dermika. The resulting firm could rival the market leaders. domestic skincare product market and sailing are expanding abroad Smooth The skincare sector endured

looking for cheaper products – in particular body-care products – but then for more specialized products, such as facial and eye skin-care products – the same consumers are willing to pay more,” explained Jolanta Górska, PR and advertising manager of Oceanic.

All of the main Polish producers have strongly diversified product portfolios in terms of price and market seg-

Looking at last year’s sales data, Dax Cosmetics and Ziaja were among the firms to beat the trend of slow growth. They each saw annual sales rise by over 20 percent.

In contrast, Dr. Irena Eris, one of Poland’s best-recognized cosmetics producers, witnessed an eight percent decline, according to information from Polish daily Rzeczpospolita.

Nevertheless, the firm experienced success with products marketed under its value brand Lirene, which it launched last year in Germany.

Polish skincare producers

have generally been well received in the markets of Central and Eastern Europe, as well as Asia, but have traditionally found Western European countries more of a challenge.

“Three product lines of the Lirene brand were recently made available in Germany through the Rossmann chain, and they have found popularity amongst the very demanding German clientele,” said Magdalena Górska-Rudzka, a PR specialist at Dr. Irena Eris.

Her firm is not the only one in Poland seeking its fortune in foreign markets. Oceanic, for example, is present in most EU markets as well as the US, South Korea and Egypt.

“Our dermo-cosmetics are sold in pharmacies, and they are much cheaper than other product lines sold in pharmacies – that is definitely our strength in export markets,” stated Oceanic’s Jolanta Górska.

In sum, Polish firms account for more than half the domestic market and are even finding success abroad in markets where to profit you need to have, well, thick skin.

Brendan Melck

POLAND’S COSMETICS INDUSTRY

MARCH 14-20, 2011

www.wbj.pl

15

Spas

Putting a new face on the Polish spa The spa and wellness industry has been the subject of much attention in recent years, and the Polish market has received more than its fair share. The country has a tradition of spa usage dating back hundreds of years and, more recently, EU accession has brought down formal and mental barriers separating it from potential clients.

Although country-specific figures are hard to come by, the global wellness industry is big money. A recent study commissioned by the Global Spa Summit evaluated the industry at nearly $2 trillion worldwide.

Spas alone accounted for $60.3 billion.

Spas making a splash “There has been an explosion of therapeutic spa services worldwide,” said Sarah Ward, publisher and editor-in-chief of European Spa. Changing mentalities about health and wellness, in particular preven-

tive health, are leading many people to embrace the spa tradition as well as services, like massages or acupuncture, which only a certain type of people were using 10 years ago, she explained.

Factors driving the change include aging populations, growing health problems such as obesity and stress-related ailments and increasing workloads, all of which also apply more and more to Poland.

“The spa industry has definitely developed a lot since EU accession,” agreed Agnieszka Joel of SPA Wilanów in Warsaw.

The spa market is composed of two main types of facilities, namely health resorts and urban-day spas.

The latter have grown almost directly from the beauty industry, while the former spring from a tradition of curative resorts which is strong in Poland. The hotel industry is also becoming an important driver for expansion, as very few high-end hotels are now built without spa facilities.

A retail experience Both health resorts and urbanday spas are major retail points for cosmetics, although tradi-

tional health resorts tend to perform less well in this area, and often need to adapt to new standards in the industry.

Spas need to have premium products to offer their services, but they are also important retailers, especially for luxury professional skincare products, explained Ms Ward. Spa clients experience the products during their treatment and are often given consultations on skincare regimes, which helps improve sales for more expensive products that are normally difficult to sell.

And this applies to a large range of products which help to re-create the spa experience at home, not just face creams.

“Retailing is certainly an area which is expanding, and a good indicator of this is that the biggest players in the cosmetics markets are moving in,” said Ms Ward.

After buying an expensive and relaxing treatment, clients want to buy the same line of products, and do not feel like going into an ordinary shop to buy a cheaper product, confirmed Ms Joel.

Her own spa has been partnering with high-end French and American brands Maria Galland and Pevonia.

Reviving tradition Health resorts have existed in Poland since the 13th century, but might now be undergoing their most important transformation yet.

Built around therapeutic mineral waters, over 40 locations in Poland have been centers of treatment for different ailments over the generations.

But as Poles’ living standards and salaries increase, so is the amount of money they are willing to spend on relaxation and beauty treatments.

One indicator of this is that health resorts all over the country are seeing an increasing number of people ready to pay out of pocket, as opposed to individuals seeking publicly funded health treatment.

At the same time, revenues generated by National Health Fund-subsidized clients are falling, forcing Polish health resorts to adapt to the expectations of their growing privatesector clientele. According to the Polish Health Resorts Association, state expenditure on health resorts in 2010 fell by about 20 percent compared to 2009.

Several state-owned health resorts are also preparing to undergo privatization, and the

Cosmetics for men

in the country. Many of these men definitely fit the “metrosexual” description.

Purchasing habits are also changing.

For example, according to research done by the International Advertising Bureau, one Polish man in five now visits websites offering cosmetic products “several times a week,” compared to one in three women. The survey also revealed that Polish men look mainly for cologne.

SHUTTERSTOCK

The Polish cosmetics market for men is estimated to have been worth just over z∏.100 million in 2010. That compares to a value of z∏.7.2 billion for the entire market, according to figures from MEMBR, a market intelligence firm.

That’s not a huge sum in comparison, but the data show that sales of products for men have exhibited a strong growth dynamic in recent years. From H1 2009 to H1 2010, for example, sales of male facial cosmetics grew by 7.6 percent in terms of value, as opposed to a 2.1 percent drop in sales for women – and this despite the financial crisis. For the H1 2008 to H1 2009 period, male facial product sales grew by 10 percent.

“Indeed, when it comes to the male cosmetics market, I see the biggest potential in facial care products which are seeing a marked increase in popularity in Poland. Many other types of products focus-

Not quite ready to embrace beauty

Polish men are learning to love cosmetics, but women may have something to do with this ing on energy-giving qualities are also becoming more popular, like aftershaves and bathing gels,” said Bartosz Gutkowski, product manager at L’Oreal Paris Men Expert.

Stereotypes and habits Sales of male cosmetics have been, to some extent, hindered by stereotypes. To illustrate the point, take the term “metrosexual.”

Coined by English journalist and writer Mark Simpson in 1994, the word describes men who pay a lot of attention to

their physical appearance and constitute the ideal demographic from the point of view of cosmetic companies and other firms dealing in beauty or fashion products. It is well recognized in Poland, but has had a strongly negative connotation (being associated with homosexuality).

The situation has changed, to some extent. An increasing number of Polish men are paying more attention to their looks today than they did five or 10 years ago, partly because of growing purchasing power

Beauty treatments are increasingly popular in Poland new investors, which include major resort operators, should be well placed to modernize the facilities and make them ready for tourists.

Traditional Polish health resorts could indeed benefit from a growing interest in wellness tourism from Western Europeans who seek authentic experiences and can benefit from ever cheaper air travel rates.

“This has already started,”

said Ms Ward. But she warned that the industry will need to adapt. And adjustments apply not only to product and service standards, but also to culture and language, as feeling comfortable is crucial to the spa experience.

Ironically then, it seems that putting a good face on the employees, and not just the clients, may be one of the industry’s biggest challenges.

Alice Trudelle

Beauty in the eye of the internet

Redefining masculinity The market for male cosmetics is growing as old stereotypes change and purchasing power increases

SHUTTERSTOCK

Poland’s spas and health resorts have strong potential, thanks to both tradition and growing modernity

Mr Gutkowski said that there was still a lot of work to be done in getting Polish men to embrace beauty products. “[They] are still less educated about face products and creams than their Western counterparts, which is why it is often women who purchase such items for them, which is a very interesting aspect of the Polish market,” he said.

But an increasing number of men are becoming interested in “looking good,” he said, especially in bigger cities. And, he noted, the term metrosexual is no longer equated directly with homosexuality.

Remi Adekoya

➡ Continued from p. 11 (Groupon.pl has nearly 30,000 Facebook fans, for example).

Dorota Kask, owner of beauty salon Studio Urody Impress in Warsaw, had her first promotion on Groupon.pl last week. For z∏.199 (a 73 percent discount) she offered a series of three facials and hand treatments. She said she did not expect to see skyrocketing profits, but rather hoped that her small business would gain greater recognition in the process.

Risk-of-the-day But there are also risks involved in working with dealof-the-day sites, warned Mr Kozak. The offer must involve a discount of at least 50 percent (up to 90 percent), which not all businesses can afford.

Moreover, the websites take sizable commissions (Groupon typically takes between 30 to 50 percent, while Citeam has emphasized it will take only 10 percent).

Small businesses can also have a difficult time dealing with a sudden surge in number of clients, which creates the risk that these clients will be unimpressed and not come

back. Alternatively, businesses located outside of major cities may find it more difficult to find a sufficient number of people interested in their offer.

Not all types of retailers will be tempted, said Praktycy.com’s Piotr Krawiec. “It is a good idea for lower- and medium-tier businesses, but it will probably not be consistent with the brand policy of luxury or more expensive brands to promote big discounts,” he said.

Bigger, but by how much?

For all these reasons, Mr Kozak believes that growth in the online group-buying sector will continue, but at a slower pace than it experienced in 2010.

Not everyone agrees, though.

“Awareness of group purchasing in Poland is still very small,” Marta Krauze of Citeam.pl said in a recent interview with Bankier.pl. “In 2010 the market was worth around z∏.40 million, but in 2011 it will certainly be several times larger.”

Alice Trudelle

16

BUSINESS ENVIRONMENT

www.wbj.pl

GDP

Bank tax bill to be discussed this week

Central bank forecasts 2012-13 GDP slowdown

The Finance Ministry has announced that draft legislation regarding a new bank tax is almost ready. Consultations on the bill should start this week.

Deputy Finance Minister Dariusz Daniluk told the Polish Press Agency that the tax would be calculated from liabilities minus basic funds and money guaranteed by the Bank Guarantee Fund (BFG).

In other words, the greater the percentage of deposits guaranteed by the BFG, the lower the

WBJ ARCHIVES

The NBP expects domestic demand to fall next year

A predicted fall in domestic demand is partly to blame The National Bank of Poland (NBP) expects the economy to cool off a bit after 2011. It is predicting a robust GDP growth rate of 4.2 percent for this year, followed by 3.6 percent in 2012 and 3.1 percent in 2013.

This stands in contrast to the IMF’s latest prognosis, published in January in its flexible credit line arrangement documentation. “Economic growth is projected to moderate slightly in 2011 and then stabilize at close to four percent in 2012-13,” the document read.

The central bank’s latest quarterly report states that the driving force behind economic

growth in the last few quarters, strong domestic demand, will continue only in 2011. This will fall in 2012 and 2013, according to the NBP, and there will also be less public investment caused by a reduction in EU fund transfers and a slowdown in restocking orders among companies which had, during the crisis, put orders on hold.

Both of these factors are expected to contribute to a decline in domestic demand.

Coupled with a marginal net export contribution to growth, this could translate into a GDP growth slowdown over the 2012-2013 period.

“The lower levels of public investment should be compensated for by private investment, which was very poor in the last two years but is expected to

improve this year. Also, we are more optimistic about private consumption, which, according to our calculations, should rise by around four percent this year,” said Grzegorz Maliszewski, chief economist at Bank Millennium.

“What I would be more worried about are the high prices of commodities such as crude oil, which could lead to increased prices of basic products, leaving people with less disposable income,” he added.

The NBP expects unemployment in Poland to drop to 9.5 percent in 2013, while inflation should remain at an average stable rate of three percent, according to the report.

Remi Adekoya

MARCH 14-20, 2011

bank’s tax base.

During the Polish Bank Association’s Bank Forum 2011 event last week, Finance Minister Jacek Rostowski emphasized that the form and scope of the bank tax would be “sensible and rational” enough to ensure greater security for the Polish banking system.

Yet, Tomasz Bursa, an analyst at Ipopema Securities noted the drawbacks of the bank tax. “Its structure means that it will be most severe to banks which have big loans

from their mother companies and bank market financing,” Mr Bursa told Parkiet. “Such is the case with BRE Bank and Kredyt Bank,” he added.

At the end of January, Prime Minister Donald Tusk said that the bank tax was not at the top of the Finance Ministry’s agenda and was therefore unlikely to be introduced in 2011. He spoke not long after Finance Minister Rostowski suggested that the tax could indeed appear this year.

Natalia Kazik

Polish managers looking into international MBAs Access MBA, an international campaign which organizes business-education events around the world, recently came to Warsaw to bring together leading international business schools and almost 200 Polish executives interested in pursuing an MBA program.

The key part of the event was a host of one-on-one counseling sessions between candidates and specialists from major MBA programs, such as Kellogg-WHU, IE Business School, Hult International Business School and Lisbon MBA. These personalized meetings were aimed at helping potential MBA students identify which programs best correspond to their inter-

ests and career paths.

Specialists provided candidates with in-depth information about the programs offered at their schools.

Before the individual sessions took place, candidates registered online and were matched to schools that meet their expectations.

Explaining the benefits of participating in the event, Dhiraj Saha, the international project manager at Access MBA Tour, said that “it’s the best way for [the candidates] to know ... if they could be admitted before applying.”

He added, “many MBA candidates make a final decision regarding the school they will enroll in shortly after the event.”

The event was organized by the Paris-based communication agency Advent Group and held in Warsaw’s Mamaison Hotel Le Regina. Warsaw Business Journal was a media partner.

The Access MBA initiative encompasses over 100 accredited business schools. With the aim of encouraging candidates to further their careers by applying for MBA programs, it targets around 30 destinations every year in Europe, the Middle East, Africa and the Americas, holding around 50 events.

This year Access MBA will visit Abu Dhabi, Sofia, Bucharest, Montreal, Boston and other major cities.

Natalia Kazik

Tax Eye

Changes in Ireland: politics and tax Richard Wernick is managing director of Totalserve (Polska) Sp. z o.o.

He is a chartered tax advisor and a registered trust and estate practitioner and has been practicing in Poland since 1997 February’s elections in Ireland were a defining moment in Irish political history. The ruling Fianna Fáil-Green coalition was wiped out as voters took their revenge for the collapse of the “Celtic Tiger” and the resulting economic crisis.

The Green Party lost all their seats and Fianna Fáil, which had been in power for 61 of the last 79 years, has been reduced to a rump faction in the Dáil (the lower chamber of Ireland’s parliament).

Fine Gael has formed a coalition with the Labour Party, which is now the secondlargest party, and there have been several Fine GaelLabour coalitions in the past. It looks likely that Fine Gael’s Michael Noonan will become

finance minister.

This means the end of Civil War politics in Ireland. Fianna Fáil was founded in 1926 and represented those who had supported the creation of a fully independent republic in the brief Civil War of 1922-23, while Fine Gael was founded in 1933 and represented those who had supported the Irish Free State (a self governing dominion within the British Empire) in that conflict and who had run the young country until 1932. These almost tribal differences were an important although declining factor in Irish political identification until the present.

Political scientists describe Fine Gael as a center-right party, though it describes itself

as a “party of the progressive center.” The party lists its core values as equality of opportunity, fiscal rectitude, free enterprise and reward, individual rights and responsibilities. It is strongly pro-EU and is a member of the European People’s Party (EPP); Fine Gael’s MEPs sit with the EPP Group.

Tax forecasts The 12.5 percent corporate income tax rate will remain unchanged and Mr Enda Kerry, the new taoiseach (prime minister), is on record as stating that this remains central to Ireland’s competitiveness. In fact there is a broad political consensus on the need to preserve and protect this rate. It is the second-

lowest CIT rate in the EU, just behind Cyprus and Bulgaria, which offer 10 percent, while Ireland was assessed first in Europe last year for ease of paying taxes for the third year running (PwC’s “Paying Taxes 2010” report).

Only a company’s active income, such as that gained from the sale of goods and services, is taxed at this rate.

Passive income, such as bank interest, capital gains and dividends, are taxed at a 25 percent rate.

Ireland will continue to offer a research & development tax credit of 25 percent for trading companies. This is additional to the standard tax deduction, meaning that an Irish company receives a 37.5

percent R&D tax deduction.

There is a participation exemption for Irish companies acting as holding companies. In order for a sale of shares to be tax exempt, the Irish company must own a minimum of five percent of the ordinary share capital of the foreign company for a continuous 12 month period.

The company whose shares are sold must be tax resident in an EU member state (including Ireland) or in a country with which Ireland has concluded a double-taxation avoidance agreement.

Double tax agreements and VAT On January 1, 2011, new double taxation avoidance agree-

ments with Georgia, Moldova and Serbia came into effect. A new agreement with Hong Kong signed on June 22, 2010, came into force on February 10, 2011, and will be effective from January 1, 2012.

Ireland’s new Job Creation Bill is expected to reduce the lower 13.5 percent VAT rate to 12 percent and it will exempt from VAT service companies that export more than 90 percent of their output. The standard VAT rate is expected to be retained at 21 percent.

No increase in personal income tax rates are envisaged but PRSI (social security) rates may be reduced as part of the aforementioned Job Creation Bill. ●

Lokale Immobilia looks at MIPIM 2011 from the Polish perspective

Dom Development has big plans for the Wroc∏aw market

19

18

LOKALE IMMOBILIA

W a r s a w B u s i n e s s J o u r n a l ’s w e e k ly s u p p l e m e n t o n re a l e s t a t e , c o n s t r u c t i o n a n d d e v e l o p m e n t

Zielona Przystaƒ green-lit Developer Elektra Plus has just obtained a building permit for its Zielona Przystaƒ retail and recreation scheme in Gorzów Wielkopolski, Lubuskie voivodship. The shopping center is scheduled for delivery in spring 2011. The process of selecting a general contractor for the development is already underway, as are talks with potential tenants. Zielona Przystaƒ, valued at approximately z∏.60 million, will offer 10,500 sqm of commercial space, which amounts to about 65 retail and services units. The mall was designed by the Pi∏a-based Studio Architektury Kontur. ●

In this issue Warsaw Spire work . . . . . . . . . .17 Aurus redesigned . . . . . . . . . . .17 ConceptHouse Mokotów . . . . .18 Dom Dev in Wrocław . . . . . . . .18 Mayland’s Jantar financed . . . .18 Property-related stocks . . . . . .18 MIPIM 2011 . . . . . . . . . . . . . . . . .19

Ghelamco launching projects in Warsaw, Wroc∏aw Construction on the long-awaited Warsaw Spire tower should start in Q2 Developer Ghelamco presented two new Polish projects at the MIPIM international real estate fair last week in Cannes, France. In Q2, to mark the 20th anniversary of its presence in Poland, the company plans to launch construction on the Warsaw Spire skyscraper, its flagship scheme in Warsaw.

Upon completion, it will be one of the tallest buildings in the Polish capital.

“We originally planned to start the realization of the investment right after we received the building permit in H1 2010,” said Jaros∏aw Zagórski, commercial and business development director

at Ghelamco Poland. “Because of the still difficult situation in the Polish office property market, however, we decided to postpone the project until 2011.”

He added that the company had spent last year optimizing the scheme with the use of the latest technologies. And potential tenant interest in the tower, Mr Zagórski assured, is high.

“Although construction will launch in Q2, we are already in talks with many potential clients including large international firms,” Mr Zagórski said.

Located in the city’s Wola district and designed by the Jaspers Eyers & Partners architectural studio, Warsaw Spire will comprise a 220-meter tower and two accompanying structures. These will together

deliver a total of 100,000 sqm of office, service and retail space.

Completion is scheduled for Q1 2014.

Construction on Ghelamco’s second investment in Wroc∏aw, Synergy Business Park, is also expected to launch soon. The scheme will comprise some 60,000 sqm of office space. Ghelamco’s first project in Wroc∏aw, Bema Plaza, was completed in 2008.

Last year the firm completed two office projects in Poland – Crown Square and Katowice Business Point – delivering a total of 34,000 sqm of space.

The company is currently developing the Mokotów Nova and Senator office developments as well as the Woronicza Qbik residential project, all of which are located in Warsaw.

Adam Zdrodowski

COURTESY OF PARTNER PROMOTION

Developer Torus has appointed CB Richard Ellis as the leading agent for its Arkoƒska Business Park project in Gdaƒsk.

The complex comprises five class-A office buildings which were completed in two phases in the 2008-2010 period and offer a total of 29,900 sqm of space. Tenants include Bank BPH, First Data, IBM, Deloitte, BZ WBK, Schneider Electric, PZU, Synopsys Poland and Xelion Doradcy Finansowi.

MARCH 14-20, 2011, LI 16/10

Office investments

The Warsaw Spire project will deliver 100,000 sqm of commercial space

Commercial development

Echo redesigns Aurus project The developer has also completed shell-andcore work on Galeria Echo’s expansion Developer Echo Investment has presented a new design for its Aurus office development in ¸ódê.

According to the new concept, Aurus will comprise two 10-storey buildings offering a total of 20,000 sqm of leasable space, including 18,500 sqm of office space. The facility will also house a parking lot for 381 cars and space for services will be found on the buildings’ ground floors.

The original design of Aurus called for three connected buildings with a total of some 28,000 sqm of GLA as well a

COURTESY OF ECHO INVESTMENT

CBRE for Arkoƒska

•

The Aurus scheme will be completed next year different parking arrangement.

The changes to the design, according to Echo Investment,

are meant to make it easier to develop the complex in stages and to sell it in the future.

Designed by the Warsawbased B’ART Pracownia Architektury, Urbanistyki i Wn´trz Bart∏omiej Bie∏yszew studio, the Aurus office complex will be built on ¸ódê’s Al. Pi∏sudzkiego, in the vicinity of a number of existing modern commercial developments.

The complex is scheduled for completion in 2012.

In separate news, Echo Investment has announced that the expansion of its Galeria Echo shopping center has been completed in shell-andcore condition. The property is located in Kielce, Âwi´tokrzyskie voivodship.

The expanded Galeria Echo encompasses 700,000 sqm of retail space, housing 300 stores and points of servic-

es. It also features a parking lot for 2,300 cars. The new section of the center is already 95 percent commercialized and the first tenants are preparing to fit out their shops. It is due to open in August.

Expansion of the shopping center reportedly cost around €100 million.

Listed on the Warsaw Stock Exchange since 1996, Echo Investment is one of the largest Polish real estate investors and developers. To date the firm has completed over 80 projects in 28 cities, totaling some 700,000 sqm of space. The developer is also present in the Hungarian, Romanian and Ukrainian markets.

Katarzyna Piasecka

Warsaw Business Journal presents Real Estate weekly newsletter • Know about the newest projects before they’re on the market • Keep up to date on the latest tenders and auctions • Learn the latest trends in Poland’s dynamic office, residential and retail sectors • Find out who’s who in Polish real estate To subscribe: e-mail subscribe@wbj.pl c +48 22 639 85 68, ext. 201 and sign up for free two-week no-obligation trial subscription or call

LOKALE IMMOBILIA – REAL ESTATE

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Residential

COURTESY OF M+G

Dom Development moves into the Wroc∏aw market

Construction has launched on Oaza, which will bring 460 units to the Wroc∏aw market

The first phase of its Oaza project will be delivered in Q3 2012 Warsaw Stock Exchange-listed developer Dom Development has launched construction work on its Oaza residential project

in Wroc∏aw, the housing giant’s first venture into that market.

The scheme, located at the intersection of ul. Nyska and ul.

Pi´kna in the city’s Krzyki district, will comprise 460 units.

“We are starting our activity outside the capital and bringing

our best standards to the Wroc∏aw market, [these] have been valued by buyers and market experts alike for 15 years, since the start of our operations,” Jaros∏aw Szanajca, president of Dom Development’s management board, said in a statement.

He added that the company was planning further investments in regional Polish cities.

“In the long-term perspective, we are thinking about the Poznaƒ, Tri-city and Kraków markets, among others, but in 2011 we will most probably concentrate on Warsaw and Wroc∏aw,” Mr Szanajca said.

The Oaza scheme was designed by the Wroc∏aw-based AP Szczepaniak studio; Wrobis is the general contractor for the project. Phase I of the development, which will deliver 116 units sized from 28.9 to 96.3 sqm, is scheduled for completion in Q3 2012.

Prices range from z∏.5,700 to z∏.7,250 per sqm.

Dom Development is currently involved in 17 residential projects. The company has been listed on the Warsaw Stock Exchange since 2006.

Adam Zdrodowski

MARCH 14-20, 2011

Atlas Estates launches sales on ConceptHouse apartments

COURTESY OF SOLSKI BM

18

ConceptHouse Mokotów has been redesigned to appeal more to mid-market buyers Developer Atlas Estates has launched sales of apartments in its latest residential investment in Warsaw.

The company’s ConceptHouse Mokotów project will be built at the intersection of the capital’s ul. Cybernetyki and ul. Obrze˝na. It will deliver a total of 160 units sized from 36 to 167 sqm, with prices ranging from z∏.7,500 to around z∏.10,000 per sqm.

“Seeing a rebound in the residential market, we decided it was high time to realize this investment, whose concept had been born earlier, in a

somewhat revised form,” Micha∏ Witkowski, sales and marketing director at Atlas Estates, said in a statement.

He added that the building had been redesigned so that it comprises a wide range of twoand three-room units and thus better suits buyers’ current needs.

ConceptHouse Mokotów has been designed by “Archiplan” Studio Projektowe Ewa Widera. Atlas Estates is currently in the process of choosing the general contractor and is negotiating bank financing for the scheme. Con-

struction is expected to launch within the next few weeks and finish in 2013.

Warsaw Stock Exchangelisted Atlas Estates is present in the Polish, Hungarian, Romanian and Bulgarian markets, with the former accounting for approximately 75 percent of the company’s investments.

Its Polish projects include the Hilton Warsaw Hotel & Convention Centre, the Millenium Plaza office building as well as the Platinum Towers and Capital Art Apartments residential schemes.

Adam Zdrodowski

Property-related stocks Security

Closing price on Mar 10

% change (week)

52-week low

52-week high

% change (year)

Total shares

Market value (z∏.mln)

BUDIMEX

97.70

0.21

84.55

106.10

17.71

25,530,098

2,494.29

CELTIC

21.65

-1.59

17.43

60.55

N/A

34,068,252

737.58

DOMDEV

46.49

2.18

38.52

61.00

-12.94

24,560,222

1,141.80

ECHO

4.95

-0.40

3.95

5.40

16.47

420,000,000

2,079.00

ELBUDOWA

158.00

0.00

155.00

188.40

-7.06

4,747,608

750.12

ENERGOPLD

3.80

0.80

3.57

4.50

-12.24

70,972,001

269.69

ERBUD

41.85

-9.14

41.85

61.00

-21.48

12,602,711

527.42

GANT

13.58

-17.04

13.58

26.00

-38.83

20,499,953

278.39

GTC

20.59

-2.14

20.58

25.00

-8.89

219,372,990

4,516.89

HBPOLSKA

2.66

-4.32

2.54

3.90

-26.11

210,558,445

560.09

JWCONSTR

14.04

-1.47

12.90

18.69

7.26

54,073,280

759.19

LCCORP

1.65

-1.79

1.41

1.73

0.00

447,558,311

738.47

MARVIPOL

9.77

2.73

8.83

22.31

-39.69

36,923,400

360.74

MIRBUD

4.70

0.00

2.71

4.75

66.67

75,000,000

352.50

MOSTALWAR

47.10

-3.03

46.91

77.00

-29.96

20,000,000

942.00

MOSTALZAB

2.98

5.30

2.63

4.84

-33.33

149,130,538

444.41

ORCOGROUP

35.40

10.59

19.00

36.50

18.20

14,053,866

497.51

PBG

204.00

3.08

190.40

252.00

-2.16

14,295,000

2,916.18

PLAZACNTR

3.79

-2.07

3.71

6.39

-38.67

292,647,720

1,109.13

POLAQUA

16.90

-5.16

16.00

22.50

0.96

27,500,100

464.75

POLIMEXMS

3.68

-1.87

3.33

5.29

-21.37

521,035,327

1,917.41

POLNORD

31.95

-1.69

30.50

44.00

-16.08

22,242,031

710.63

RANKPROGR

10.70

4.90

9.59

10.96

N/A

37,145,050

397.45

ROBYG

1.80

-1.10

1.70

1.94

N/A

257,390,000

463.30

RONSON

1.46

3.55

1.36

2.10

-13.10

272,360,000

397.65

TRAKCJA

3.46

-2.54

3.46

4.97

-15.20

160,105,480

553.96

ULMA

82.40

-0.72

70.00

86.20

3.06

5,255,632

433.06

UNIBEP

7.95

-8.73

7.30

10.30

3.79

33,927,184

269.72

WARIMPEX

10.65

0.47

7.64

10.85

31.48

54,000,000

575.10

ZUE

13.90

2.96

13.50

15.14

N/A

22,000,000

305.80

Mayland gets €65 million in financing for Jantar Mayland Real Estate has obtained €65 million in bank financing for the Jantar shopping center project in S∏upsk, Pomorskie voivodship. The funds will be used to cover the cost of expanding the scheme.

Jantar currently amounts to more than 22,000 sqm, but this will soon grow to a total of 46,000 sqm. Construction has already started and is

expected to finish in April 2012.

Jantar was developed by Mayland Real Estate in 2008 and in December last year the center was sold to EPISO, a fund managed by AEW Europe and Tristan Capital Partners, for €92 million.

Mayland is still responsible for the development of the Jantar project, as well as for

the management of the property. The mall, including its new section, is currently over 75 percent leased out.

Mayland Real Estate has to date developed three regional shopping centers in Poland. The company’s Polish pipeline includes a number of retail projects totaling 240,000 sqm of GLA. Adam Zdrodowski

MARCH 14-20, 2011

LOKALE IMMOBILIA – REAL ESTATE

www.wbj.pl

MIPIM 2011

The message from MIPIM: believe the Poland hype

CEE investment doubles Retail investment turnover in CEE reached €1.8 billion last year following the completion of a number of prime transactions. That’s twice the level seen in the region in 2009, according to a recent report by CB Richard Ellis. Poland stood out from the crowd, being the most liquid market and seeing strong cross-border investor support, unlike most other CEE countries, in which local buyers and non-institutional purchasers have gained in significance, the study said.

Andrew Kureth

Though cautious, participants at this year’s annual real estate extravaganza were bullish on Poland

Global appeal Much of the focus was on real estate markets in France and the UK (this year’s “Country of Honor”), where the best – and safest – opportunities are to be found, according to general consensus. Increasingly, however, Poland was also mentioned in the same breath.

Some disagreement still exists as to whether Poland has yet reached “core” status, but an oft-repeated mantra at the conference was that all of the biggest, most serious players in the market were either looking at Poland, moving into it, or already there.

“It’s becoming more globalized,” said Otis Spencer, cohead for Europe and CEE at investment management firm Heitman International. “Increasingly we’re hearing investors not just from Europe, but from the United States and Asia, say that they want exposure to France and the UK, and also Poland.”

Mr Spencer was speaking during a panel discussion host-

New leases in Silesia SHUTTERSTOCK

With real estate markets around the world clawing their way towards recovery after the global economic crisis, participants at this year’s MIPIM – the annual real estate exhibition and meeting event held each year in Cannes, France – exuded a cautious optimism.

Industry representatives noted with satisfaction that while the lavish parties of precrisis MIPIMs had still not returned, there were still plenty of deals to be done. Attendees often remarked that this year’s edition of the event had a more professional, business-driven air. Those present were there to concentrate on business.

19

The Polish real estate market is building on its strengths ed by Warsaw Business Journal on investment throughout the CEE region, where opportunities in Poland were decidedly the dominant topic. This was a recurring theme during the four-day MIPIM event, and players in the Hungarian and Czech markets expressed their jealousy – and sometimes even frustration – at all the attention Poland was getting.

All sectors of the Polish property market garnered interest, but the lion’s share surrounded three specific areas: office development in Warsaw, shopping center development in secondary cities, and the country’s stable and steadily growing residential market.

& Wakefield’s Polish branch.

“The Warsaw pipeline is relatively restricted,” he added.

And there’s been a tremendous amount of interest in Warsaw offices. Transaction volume reached €1.96 billion last year, the highest level since 2007.

However, the increased investment activity has pushed down yields to around 6.5 percent.

The consensus was that Warsaw has solidified its position as the regional business hub, and therefore more inter-

Office on the up

national corporates will be looking to move in as they look to establish footholds in the region.

“The corporates are there,” said John Duckworth, managing director for Central & Eastern Europe at Jones Lang LaSalle. “The developers are doing well, the financing is coming along, so the investors like that.” He also said that vendors are selling at reasonable prices, and buyers buying at reasonable prices, which was a sign that Poland is becoming a mature market.

opportunities exist in Warsaw, they also said good locations are becoming increasingly difficult to find.

In Poland’s secondary and tertiary cities, however, there is still a pronounced lack of shopping centers and retail parks where Poles can spend their growing wealth.

Tenants are becoming more confident as well, said Rafa∏ Twarowski, managing director of ECE Projektmanagement Polska. “The mood in the mar-

“It’s not a gold rush, but there are lots of opportunities, especially for experienced partners”

and encouraging young people to come back to the market. He contrasted that with France, which has a high level of state support for mortgage-takers.

In the short term, REAS doesn’t see prices increasing.

However, in the medium term – around 2013 – it expects them to start rising, as demographic trends start to push demand higher. Getting in on a residential project in the development phase is a good bet, Mr Kirejczyk said, as long as the project is a good one and the price for land is decent. He estimated that developers would be able to achieve margins of up to 30 percent.

Don’t believe the hype?

Though Warsaw has seen plenty of office development in recent years, the market is far from saturated, experts agreed.

The city could easily see its existing new stock of some 3.4 million sqm increase to six million sqm in the short term.

Offices in Warsaw are a good investment over the next few years, said Richard Petersen, managing partner at Cushman

SHUTTERSTOCK

Shopping centers go regional

Poland’s residential market is growing at a stable pace

That Polish consumers fueled the country’s economic growth during the crisis period is now widely understood by investors.

It’s also no secret that Poland is forecast to grow at a faster pace than its neighbors this year, and that wages and spending power are rising. All of that makes for good prospects in the retail sector. And while experts at MIPIM acknowledged that

ket from tenants is improving,” he said, “they are beginning to believe more in the market.”

Stable homes According to research by advisory REAS, Poland has been the most successful residential market in the region over the past few years, and this isn’t expected to change in the near term. The Polish market didn’t see the dramatic price drops in 2008-2009 as did some countries in the region, primarily due to its gradual development, according to Kazimierz Kirejczyk, partner and president of the board at REAS. “Poland’s [residential] market developed in a sustainable way – with a relatively low level of state subsidies,” he said.

Although Poland did institute the “Family on its Own” mortgage subsidy program during the crisis, Mr Kirejczyk saw the program as having more of a “psychological effect” on the market than anything else: It indicated that the state was supporting the return to lending

All of this naturally begs the question as to whether Poland is at risk of overheating, or if it is overhyped.

When asked about the danger Michael Kroeger, executive vice president for real estate lending at Helaba, was sanguine. “Every time we start talking about something, in two weeks there’s always the question of whether it’s overheating,” he said.

Mr Petersen agreed, saying he didn’t see any danger of overheating.

For his part Mr Duckworth, from Jones Lang LaSalle, emphasized caution, despite Poland’s good placement.

“Poland does tend to get hyped a bit,” he said. “People love being in Poland because of the macroeconomic element. But we can’t paint with too broad a brush. Caution is important, and it’s easy to go wrong.”

“It’s not a gold rush,” he said, “but there are lots of opportunities, especially for experienced partners.” ●

Global warehouse space developer ProLogis has recently concluded five new lease deals for a total of 42,800 sqm at its distribution parks in Silesia. The new tenants include ID Logistics, Hellmann Worldwide Logistics Polska, “Latex” Groehl Gerard and ArchiDoc. In addition, Wincanton extended its lease agreement for 16,600 sqm at a ProLogis distribution park in Sosnowiec.

Segro’s anniversary British industrial space provider Segro is celebrating its fifth anniversary in Central Europe. The company’s Central European portfolio now comprises more than 575,000 sqm of predominantly industrial and warehouse assets.

This space is located within nine parks located in or near Prague, Ostrava, Gdaƒsk, Gliwice, ¸ódê, Poznaƒ, Stryków and Warsaw. In 2008, Segro also completed the Tulipan House office project in Warsaw, which it sold to CommerzReal.

McKinsey in Malta Consultancy McKinsey & Company has leased 2,700 sqm of space in Echo Investment’s Malta Office Park complex in Poznaƒ.

The project, which comprises six buildings, offers almost 31,000 sqm of GLA. Work on Malta Office Park started in August 2007; construction is currently underway on the last phase of the scheme. ●

20

MARKETS

www.wbj.pl

MARCH 14-20, 2011

Stocks report

world stock indices DJIA

NASDAQ

S&P500

FTSE100

DAX

Market malaise

NIKKEI225

11,986.16 (March 10 close)

2,705.40 (March 10 close)

1,296.87 (March 10 close)

5,807.66 (March 10 close)

7,041.91 (March 10 close)

10,425.51 (March 10 close)

-2.28% (for the week)

-3.29% (for the week)

-2.56% (for the week)

-3.29% (for the week)

-2.47% (for the week)

-1.50% (for the week)

CHANGE: 3.53%

CHANGE: 1.07%

CHANGE: 3.12%

CHANGE: -1.56%

CHANGE: 0.98%

CHANGE: 0.71%

(year to March 10)

(year to March 10)

(year to March 10)

(year to March 10)

(year to March 10)

(year to March 10)

52-week high: 12,418.00

52-week high: 2,840.51

52-week high: 1,344.07

52-week high: 6,105.80

52-week high: 7,441.82

52-week high: 11,408.17

52-week low: 9,596.04

52-week low: 2,061.14

52-week low: 1,010.91

52-week low: 4,790.00

52-week low: 5,607.68

52-week low: 8,796.45

After experiencing a series of upward movements recently, the WSE’s main indices saw only moderate shifts last week.

On Monday, despite lingering uncertainty concerning the situation in Libya and the price of oil, investors tried to break the resistance levels of the main WIG and the blue-chip WIG20. The largest companies of the latter index, including KGHM, Bank Pekao and Orlen accounted for the increases.

By the end of that day, however, both indices had weakened following corrections on international markets. During the rest of the week, the WIG20 failed to reach the psychological barrier of 2,800 points at the closing bell.

Some analysts think the market will be unable to continue growing in the short term without the WIG20

Major indices WIG

47,929.59 (March 10 closure)

WIG20

2,760.25 (March 10 closure)

10.03

09.03

08.03

07.03

04.03

03.03

02.03

01.03

28.02

25.02

24.02

23.02

22.02

10.03

09.03

08.03

07.03

04.03

03.03

02.03

01.03

28.02

2,600

25.02

46,000

24.02

2,640

23.02

46,600

22.02

2,680

21.02

47,200

18.02

2,720

17.02

47,800

16.02

2,760

15.02

48,400

14.02

2,800

11.02

49,000

21.02

52-week low: 2,270.13

18.02

Change year to March 10: 0.20%

17.02

52-week low: 39,109.37

16.02

52-week high: 2,794.73

Change year to March 10: 0.59%

15.02

Change for the week: -0.10%

14.02

52-week high: 48,421.80

11.02

Change for the week: -0.22%

Top 5 POLREST KRAKCHEM CHEMOS OPTIMUS COGNOR

Closing 0.51 4.80 0.52 7.27 4.75

% change (week) 52-week high 41.67 1.06 29.03 5.10 20.93 0.97 18.99 7.78 14.18 4.89

52-week low 0.24 3.55 0.41 1.15 2.40

Top 5 PKNORLEN TPSA TAURONPE PBG GETIN

Closing 50.05 17.08 6.45 204.00 13.39

% change (week) 4.93 4.46 3.37 3.08 2.61

52-week high 50.50 18.65 6.89 252.00 13.47

52-week low 35.48 14.10 5.04 190.40 9.35

Bottom 5 TECHMEX HELIO GANT ASTARTA ONE2ONE

Closing 0.05 13.74 13.58 80.00 5.39

% change (week) -44.44 -17.63 -17.04 -15.57 -14.98

52-week low 0.05 13.74 13.58 49.10 5.10

Bottom 5 KGHM PGNIG GTC POLIMEXMS CYFRPOLSAT

Closing 169.00 3.83 20.59 3.68 15.60

% change (week) -8.10 -2.30 -2.14 -1.87 -1.27

52-week high 188.90 3.94 25.00 5.29 17.30

52-week low 88.20 3.16 20.58 3.33 13.36

52-week high 2.30 26.25 26.00 102.00 11.15

Currency report

Terror in Japan

Other indices mWIG40

2,874.88 (March 10 closure)

sWIG80

12,716.64 (March 10 closure)

NewConnect

58.38 (March 10 closure)

WIG-Banki

6,979.00 (March 10 closure)

Change for the week: -0.34%

52-week high: 64.23

Change for the week: 0.91%

52-week high: 7,262.73

Change year to March 10: -7.93%

52-week low: 54.64

Change year to March 10: 0.24%

52-week low: 5,751.39

60.0

7,100

59.4

7,000

58.8

6,900

58.2

6,800

57.6

SOURCE: WSE

10.03

09.03

08.03

07.03

04.03

03.03

02.03

01.03

28.02

25.02

24.02

23.02

22.02

21.02

18.02

17.02

16.02

15.02

11.02

14.02

6,600

10.03

09.03

08.03

07.03

04.03

03.03

02.03

01.03

28.02

25.02

24.02

23.02

22.02

21.02

18.02

17.02

16.02

15.02

14.02

6,700 11.02

57.0

Adam Narczewski, X-Trade Brokers Dom Maklerski SA

10.03

09.03

08.03

07.03

04.03

03.03

02.03

01.03

28.02

25.02

24.02

23.02

10.03

09.03

08.03

07.03

04.03

03.03

02.03

01.03

28.02

12,600 25.02

2,800

24.02

12,660

23.02

2,820

22.02

12,720

21.02

2,840

18.02

12,780

17.02

2,860

16.02

12,840

15.02

2,880

14.02

12,900

11.02

2,900

22.02

52-week low: 10,980.45

21.02

Change year to March 10: 3.81%

18.02

52-week low: 2,361.69

17.02

Change year to March 10: 2.39%

16.02

52-week high: 12,855.31

15.02

Change for the week: -0.31%

14.02

52-week high: 2,904.35

11.02

Change for the week: -0.35%

first consolidating around the 2,800 point level.

Nevertheless, the performance of Poland’s bluechip index is expected to be negatively influenced by the fact that it features a large number of raw materials companies. The raw materials markets have been seeing a deepening correction of late.

Moreover, the current correction, which is expected to continue on the main international bourses, does not bode well as far as the prospects for reaching new highs on the Warsaw bourse are concerned. This is despite the fact that last week the Polish market showed some degree of resilience to bad news from abroad.

Last Friday the WIG20 and WIG closed at 2,749.30 and 47,689.93, seeing 1.21 and 1.25 percent decreases on the week, respectively. ●

The events of last week could bring some “relief” from growing concerns about political changes in Libya and other countries in the Middle East.

The first three days of the week could be described in a few words: low volatility and no important events. On Thursday sentiment changed. Negative figures for the US trade balance and unemployment claims fueled strong declines on all important stock markets, with the New York Stock Exchange at the forefront.

The situation got much worse on Friday. The opening of European stock markets coincided with information about the terrible earthquake and tsunami in Japan. As this commentary was being written, the situation and potential consequences of this catastrophe

were still unclear, but global markets reacted strongly.

The prices of index futures fell and global risk aversion hit emerging market currencies, including the z∏oty. The euro and British pound declined against the usual safe havens, the US dollar and Swiss franc.

Prices of most key resources and precious metals didn’t change drastically, but volatility was incredibly high.

Oil dropped about three percent, to under the $100 level. Paradoxically, the yen appreciated strongly, probably due to Japanese savings being brought back to country and converted into domestic currency.

It is too soon to predict the potential range of further declines, but the disaster could bring a strong correctional move on both stocks and resources. ●

currency rates

SOURCE: NBP

3.4784

3.5360 11.03

3.4577 09.03

10.03

3.4608 08.03

3.4710

3.4562

11.03

10.03

04.03

0.1018

0.1013

3.5

07.03

PLN-100JPY

3.6

3.4

09.03

0.1009 07.03

04.03

08.03 0.1008

0.1016

3.0929

3.1277 11.03

0.100

0.1012

PLN-RUB

0.102

10.03

3.0698 09.03

3.0627 08.03

07.03

3.0794 04.03

4.6641

4.6787 11.03

3.05

3.0658

PLN-CHF

3.15

10.03

4.6360 09.03

4.6185 08.03

07.03

4.6519 04.03

2.8849

2.9212 11.03

4.5

4.6308

PLN-GBP

4.8

10.03

2.8644 09.03

2.8549 08.03

2.8372 07.03

2.8646 2.5

04.03

4.0316 11.03

3.9915 10.03

09.03

08.03

PLN-USD

3.0

3.9758

3.9795 07.03

3.9

04.03

3.9988

3.9756

PLN-EUR

4.1

THE LIST

MARCH 14-20, 2011

www.wbj.pl

21

Private Health Care Centers in Warsaw Ranked by total revenue in 2009

www.bookoflists.pl Gastrology / Gynecology / Internal diseases / Cardiology

Laryngology / Occupational medicine / Nephrology / Neurology

Orthopedics / Pediatrics / Psychiatry / Psychology

Pulmonology / Rheumatology / Urology / Ophthalmology

Dentistry / Maternity ward / Emergency services

NFZ services / Laboratory tests / Home visits

Rehabilitation Corporate packages / Medical diagnostics / Physician on duty

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓

36 811,495(2) 1992

Anna RulkiewiczKaczyƒska

2,500 WND

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓

WND ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓

10 WND 1994

Ma∏gorzata Kowalska

998 WND 611 546

720 WND

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ -

✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓

7 300,000+ 1993

Adam Rozwadowski

WND 2.5 2.9 4.2

WND 188 WND 143

97 69

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ -

✓ ✓ ✓ ✓

✓ ✓ -

✓ -

✓ ✓ ✓ -

✓ -

3 100,000 2000

8.8 17.8 17.0 15.0

2.0 4.1 4.0 2.0

92 90 81 71

230 185

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ -

✓ -

✓ ✓ ✓ ✓

✓ -

3 264,000 1956

El˝bieta ¸ukowskaSawicka

Centrum Medyczne Mavit Sp. z o.o. ul. PodleÊna 61, 01-673 Warsaw 6 22 569-5900/22 569-5919 info@mavit.com.pl www.mavit.com.pl

9.6 16.4 14.6 10.0

WND WND WND WND

WND WND WND WND

28 28

-

-

-

-

✓

-

✓ -

-

✓ -

2 90,200 1999

Andrzej Màdrala

Polska Fundacja Europejskiej Szko∏y Onkologii ul. Nowogrodzka 62A, 02-002 Warsaw 7 22 331-4140/22 331-4145 przychodnia@pfeso.edu.pl www.pfeso.edu.pl

2.2 5.0 5.2 4.3

0.1 0.6 0.6 0.4

11 14 16 WND

58 18

✓ ✓ ✓

✓ ✓ ✓

✓ -

-

✓ -

-

✓ -

✓ ✓ -

-

1 185,000 1990

W. Ró˝yckiGerlach

Centrum Medyczne Nasze Zdrowie Sp. z o.o. ul. Czerniakowska 161, 00-453 Warsaw 8 22 851-0642/22 851-0643 cm@nasze-zdrowie.pl www.nasze-zdrowie.pl

2.0 4.0 4.0 3.0

1.0 2.0 2.0 WND

WND WND WND WND

34 23

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓

✓ ✓

✓ ✓ ✓ ✓

✓ -

✓ ✓ -

✓ ✓ ✓ -

-

1 37,400 1993

2.1 3.2 WND WND

WND WND WND WND

WND WND WND WND

36 32

✓ ✓

✓ ✓ ✓

✓ ✓ ✓ ✓

✓ -

✓ ✓ ✓ ✓

-

✓ ✓ -

✓ -

-

2 36,000 1994

Andrzej Sawicki

Europejskie Centrum Zdrowia Otwock Sp. z o.o. ul. ˚ytnia 16 lok. C, 01-014 Warsaw NR 22 710-3001/22 710-3160 biuro@ecz-otwock.pl www.ecz-otwock.pl

WND WND WND WND

WND WND WND WND

WND WND WND WND

25 15

✓ -

✓ ✓ ✓

✓ -

✓ ✓

✓ -

-

✓ ✓ -

✓ ✓ -

✓ ✓ ✓

1 WND 2004

Anna KieszkowskaGruda

Klinika Medyczna IBIS Sp. z o.o. i Wspólnicy Sp.k. ul. Kacza 8, 01-013 Warsaw NR 22 322-8130/22 322-8180 szpital@szpitalibis.pl www.szpitalibis.com.pl

WND WND WND WND

WND WND WND WND

12 12 10 8

73 60

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓

✓ ✓

✓ ✓ ✓ ✓

✓ -

✓ ✓ -

✓ ✓ -

✓ -

3 98,000 2001

Katarzyna Wojtowicz Medical Director

Sensor Cliniq Sp. z o.o. i Wspólnicy Sp.kom. ul. Kacza 8, 01-013 Warsaw NR 22 322-8183/22 322-8181 szpital@szpitalsensor.pl www.szpitalsensor.com.pl

WND WND WND WND

WND WND WND WND

12 12 WND WND

70 52

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓

✓ ✓

✓ ✓ ✓ ✓

✓ -

✓ ✓ -

✓ -

✓ -

2 96,000 2001

Medical Director

Rank

Allergology / Surgery / Dermatology / Endocrinology

Specialization Company name Address Tel./Fax E-mail Web page

Revenue from Number of Number of Total revenue healthcare clients Physicians: (z∏. mln) package served Total / sales (z∏. mln) min. 5h/week 1st half of 2010 / 2009 / 2008 / 2007

Lux-Med Sp. z o.o. (1) ul. Post´pu 21C, 02-676 Warsaw 1 22 332-2888, (801) 800 808/ 22 322-7642 marketing@luxmed.pl www.luxmed.pl

WND 559.3 302.0 144.1

WND WND 175.0 WND

WND WND 4,345 WND

3,950 WND

Grupa Medicover w Polsce (3) ul. Bitwy Warszawskiej 1920r. 18, 2 02-366 Warsaw 500-900-500/22 592-7001 www.medicover.pl

WND 435.0 409.0 253.0

WND WND WND WND

WND 5,500 5,000 4,205

Centrum Medyczne ENEL-MED ul. S∏omiƒskiego19/524, 00-195 Warsaw 3 22 431-7700/22 431-7703 enel@enel.pl www.enel.pl

WND 120.7 112.0 75.2

WND 60.0 55.0 39.8

DANTEX SA - Centrum Medyczne DANTEX-MED ul. P∏ocka 9/11, 01-231 Warsaw 4 22 887-3390/22 887-3391 med@dantexmed.pl www.dantexmed.pl

WND 36.1 66.8 25.1

Spó∏dzielnia Pracy Specjalistów Rentgenologów ul. Waryƒskiego 9, 00-655 Warsaw 5 22 621-2366/22 629-3296 biuro@rentgen.pl www.rentgen.pl

Centrum Medyczne Osteomed Sp. z o.o. ul. Bia∏obrzeska 40A, 02-341 Warsaw 9 22 868-2927, 868-2936/868-2942 osteomed@osteomed.pl www.osteomed.pl

Notes: Notes: NR = Not Ranked, NA = Not Applicable; WND = Would Not Disclose. Research for The List was done in November 2010.

Number of employees and ownership structure are as of October 2010. All information pertains to the companies’ activities in Poland. Companies not responding to our survey are not listed. Footnotes: (1) Consolidated financial data of CM LIM, LUX MED, Medycyna Rodzinna, PROMEDIS i AVI. (2) Data as of July 2010. (3) Consolidated financial data of Medicover Sp. z o.o., Medicover Forsakrings SA (in Poland), Synero Polska Sp z o.o., Medicopharma, Centrum Medyczne Damiana

Offices in Family Warsaw / Top local packages / Registered executive / Hospital / patients / Title Ambulance Year founded

President

Vice President

President

Wojciech Kossut Managing Director

President

President

President

Katarzyna Hosaja Managing Director

President

Director

Katarzyna Wojtowicz

To the best of WBJ ’s knowledge, the information is accurate as of press time. While every effort is made to ensure accuracy and thoroughness, omissions and typographical errors may occur. Corrections or additions to The List should be sent, on official letterhead, to Warsaw Business Journal, attn. Joanna Raszka, ul. Elblàska 15/17, 01-747 Warsaw, via fax to (48-22) 639-8569, or via e-mail to wbjbol@wbj.pl. Copyright 2011, Valkea Media SA. The List may not be reprinted or reproduced in whole or in part without prior written permission of the publisher. Reprints are available.

ARTS & CULTURE

www.wbj.pl

Lord of the Dance Torwar Stadium March 17 & 18, 7:30 pm Irish icon Michael Flatley first earned international acclaim with “Riverdance,” a theatrical step-dance show that took the world by storm in 1994. He’s also put together a few other shows, including the hit “Lord of the Dance,” which has been running since 1996.

Having spent much of the last decade on hiatus, Flatley has now dusted off his prancing shoes and returns to War-

COURTESY OF WWW.MICHAELFLATLEY.COM / BRIAN MCEVOY

A reel good time

Pluck of the Irish St. Patrick’s Day celebrations Teatr Rampa March 17, 11 am & 7 pm

JRM group, has been around since 1990. JRM’s performances are informed by “jig and reel” dances and inspired by Celtic harmonies, as well as elements of jazz, reggae, funk and fusion. In other words, this is “Celtic Groove.”

Ellorien, by contrast, is a Wroc∏aw-based Irish dance group set up in 2004. In 2007, the all-girl group joined forces

In honor of St Patrick’s Day, Teatr Rampa is putting on “Irish Days at Theatre Rampa,” a celebration of Celtic music and a dance. The event features two groups of artists. The first, Poznaƒ’s

saw to front this dance extravaganza. The March 17 and 18 performances are in Warsaw, but the show will

appear in a total of eight cities in Poland. ● Tickets start at z∏.101. Visit www.eventim.pl for more details

A people of the land COURTESY OF PME

Mapuche: the grain of Chile The State Ethnographic Museum in Warsaw (through June 4) The latest exhibit at Warsaw's Ethnographic Museum showcases the lives of the Indian Mapuche people of Chile.

Over 300 artifacts (including jewelry, weaponry and ceramics) as well as photographs and audio-visual materials form a lively introduction to one of

MARCH 14-20, 2011

South America's most intriguing regions.

The exhibition is in Polish and English, and details the practice of shamanism, tex-

tiles, home-life, death rituals and the relationship of the Mapuche people to the land.

It also explores the traditional Mapudungun language. ●

Get an Insider’s glimpse at all that Warsaw has to offer with the Warsaw Insider!

with Sarah Clark (of “Lord of the Dance” fame), under whose guidance they’ve gone on to perfect such Irish dance standards as the jig, double-jig, slip jig, hornpipe, polka and reel. ● Tickets for the 11 am show z∏.25; tickets for the 7 pm show z∏.60.

Log onto www.teatr-rampa.pl for more info

Latin rhythms, African beats Omar Sosa Afri-Lectric Quintet Warsaw Palladium March 19, 8 pm Omar Sosa, a pianist and master of the marimba, plays Palladium as part of the annual Era Jazzu festival. Born in Cuba, Sosa brings with him the best of AfroCuban music, mixing up jazz with Latin sounds and African percussion. Politically and spiritually charged, his music has been lauded the world over for its unique sound. ●

COURTESY OF ERA JAZZU

22

Tickets available via the usual channels, (EMPIK, ticketpro,

bileterie and eventim). More info at www.jazz.pl

French connections Francophonic Festival March 18 & 19 (Stodo∏a) March 24 (Palladium) March 25 (Kamienio∏omy) The fifth Francophonic Festival opens on March 18 with a concert headlined by Polish singer Monika Brodka. The festival is a platform for collaboration between Polish and French artists.

Joining Ms Brodka for the opening concert are Oh La La!,

a French rock band headed by Natasha Lejeune (described as a “French Franz Ferdinand”) and Pony Express, an indiefolk-rock mix.

Acts performing on other nights include Melissa La-

veaux, Pako Sarr, Nouvelle Vague and Turzi. ● Tickets start at z∏.75 for the first three nights; visit www.eventim.pl for more details. No presales for March 25 concert

Some content provided by the Warsaw Insider. For more information on culture and entertainment in Warsaw this month, pick up the March issue.

Museums, galleries and venues in Warsaw Centre for Contemporary Art at Ujazdowski Castle ul. Jazdów 2 www.csw.art.pl Czarna Gallery ul. Marsza∏kowska 4 www.czarnagaleria.art.pl Galeria 022, DAP, Lufcik ul. Mazowiecka 11a www.owzpap.pl Galeria 65 ul. Bema 65 www.galeria65.com Galeria Appendix 2 (Praga) ul. Bia∏ostocka 9 www.appendix2.com

Warsaw’s most popular Englishllanguage lifestyle lif t l magazine i ffeatures: t : • top shopping reviews and listings • monthly calendar of parties, eventss and exhibitions • latest art, design, fashion and beauty trends • hotel, spa and fitness club reviews • up-to-the-minute resto, bar, cafe and club reviews

Subscribe to the Insider! Contact t t kwilinski@valkea.com k ili ki lk

Galeria Foksal ul. Foksal 1-4 www.galeriafoksal.pl Galeria XX1 Al. Jana Paw∏a II 36 www.galeriaxx1.pl Galeria Zoya ul. Kopernika 32 m.8 www.zoya.art.pl Green Gallery ul. Krzywe Ko∏o 2/4 www.greengallery.pl Katarzyna Napiórkowska Art Gallery ul. Âwi´tokrzyska 32, ul.

Krakowskie PrzedmieÊcie 42/44

and Old Town Square 19/21 www.napiorkowska.pl

Królikarnia National Gallery ul. Pu∏awska 113a www.krolikarnia.mnw.art.pl Le Guern Gallery ul. Widok 8, www.leguern.pl Museum of Independence Aleja SolidarnoÊci 62 www.muzeumniepodleglosci.art.pl National Museum in Warsaw Al. Jerozolimskie 3 www.mnw.art.pl Polish National Opera at Teatr Wielki Pl. Teatralny 1 www.teatrwielki.pl Pracownia Galeria ul. Emilii Plater 14 www.pracowniagaleria.pl Rempex Art and Auction House ul. Karowa 31 www.rempex.com.pl

State Archaeological Museum in Warsaw ul. D∏uga 52 (Arsena∏) www.pma.pl State Ethnographic Museum ul. Kredytowa 1 www.ethnomuseum.website.pl Historical Museum of Warsaw Old Town Square 28-42 www.mhw.pl History Meeting House of Warsaw ul. Karowa 20 www.dsh.waw.pl Warsaw Philharmonic ul. Jasna 5 www.filharmonia.pl Warsaw Rising Museum ul. Grzybowska 79 www.1944.pl

Royal Castle Pl. Zamkowy 4 www.zamek-krolewski.com.pl

Wilanów Palace Museum and Wilanów Poster Museum ul. St Kostki Potockiego 10/16 www.milanow-palac.pl www.postermuseum.pl

Simonis Gallery ul. Burakowska 9 www.simonisgallery.com

Zachęta National Art Gallery Pl. Ma∏achowskiego 3 www.zacheta.art.pl

LAST WORD

MARCH 14-20, 2011

www.wbj.pl

23

Tech Eye

Unbeknownst even to our closest friends, Techeye suffers from a crippling fear of samurai. Sure, we kid with the other guys, joking about how awesome it would be to don the heavy Ō-yoroi, take up the katana and follow the code of bushidō. But it’s all a charade.

The very thought of a samurai creaking towards us, beady eyes staring out beneath a vulgar kabuto helm ... it makes us cry like a little girl splattered by the finale of a pony-lawnmower showdown. So

take note of the bravery it took to write this week about ST Dupont’s Samurai limited edition lighter and pen set.

What’s that, you wonder with astonishment etched across your face? Techeye’s actually discussing a samurai-themed product, having just professed a mortal fear of Japan’s medieval warrior? Oh yes, but it took two full boxes of tissues. And half an hour spent hiding under our childhood blanket.

In terms of tech, there’s not

much to the product. The set comes with a chunky-yet-attractive lighter and a couple of chunky-yet-attractive fountain pens, all of which are chunkily ornamented. Would the samurai have approved? Bah, who cares what they would have thought.

Pricing and availability is a bit confusing. Apparently the limited edition part of “Samurai limited edition” means that only 888 basic sets will be produced, but ST Dupont is also selling 20 “Samurai Prestige” sets. According to some reports, the latter cost a rather chunky $60,000 each.

If you’re interested, we suggest you have a look for yourself at www.st-dupont.com.

The right watch An item which bears blessedly little resemblance to anything samurai related is Maximilian Büsser & Friends’ HM3 ReBel timepiece. The company technically refers to it as a “horological machine,” but we’re pretty sure it’s a watch.

MB&F’s sales pitch is compelling. “James Dean was a Hollywood Rebel Without a Cause; Billy Idol had a Rebel Yell; Star Wars had

its Rebel Alliance; and now MB&F pokes the establishment firmly in its conservativelyfocused eye with the HM3 ReBel.” Take a moment to soak that in – this is a gadget which mixes Dean’s stylish disaffectation and Idol’s toothy sneer together with Wookies. It may or may not poke you in the eye (depending on how entrenched you are in the establishment). And it tells the time (although it is probably hard to read if you’ve been poked in the eye).

There’s only one response to a gadget like that. To quote Chewbacca (in “The Empire Strikes Back”) – “Vrowarrrk!”

Pushing our Wookie-inspired enthusiasm to the side for a moment, there are a few things to keep in mind about the HM3 ReBel. First off, it’s adorned with black PVD-treated white gold, boasts “blackened movement” and has a 22K gold rotor.

COURTESY OF MB&F

COURTESY OF ST DUPONT

The sharp edge of fear and the ReBel yell

Second, it’s meant to sit on a right wrist. As opposed to a left wrist (and not a wrong wrist). Why is that?

We’re not sure, but it’s probably has something to do with Billy Idol.

And finally, it does have a few things in common with the Samurai set – both are chunky, expensive and only available in limited quantities.

Only 18 HM3 ReBel timepieces will be made and, as far as we can tell, the company is asking for about $84,000 per watch.

In other words, the right wrist for the HM3 ReBel will be a right wrist attached to a right hand holding a fat wallet. ●

Ever quoted Chewbacca out loud, silencing all those around you? Let us know: techeye@wbj.pl

To advertise in WBJ’s classifieds section, contact Ms Agnieszka Brejwo, at (+48) 222-577-526 or abrejwo@wbj.pl