Battle between fashion retailers heats up

In recent years, the Estonian market has seen the arrival of several so-called fast fashion retailers that have become very successful and taken market share away from established brands, writes Äripäev.

One of such retailers is Polish listed company LPP S.A. that in Estonia operates through its subsidiary LPP Retail Estonia and last year saw retail sales go up 18%. The company’s profit amounted to almost EUR 1.5m.

Commenting the company’s results, board member Hendrik Ilja Pass said that one reason behind the success was the launch of its new retail brand Mohito. The company’s other retail brands are Reserved, Cropptown and House.

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Estonia is Europe’s largest pillow and blanket maker

Estonia is Europe’s largest maker of pillow and blankets in per capita terms, Meelis Virkebau, head of the Estonian Clothing and Textile Association, told Äripäev.

„We have several large producers in Estonia. The biggest of them is Wendre that has production in Estonia, Poland and China,” said Virkebau.

Speaking of Wendre, Virkebau said that it has been a long-term supplier of IKEA and is now increasing sales in UK where it has successfully entered several retail chains.

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Only Slovaks poorer than Estonians in Eurozone

Among 17 Eurozone members, Estonians are one of the poorest by net value of their assets, shows statistics published by Swedish business newspaper Dagens Industri, writes Äripäev.

In a survey in which Credit Suisse and Oxford University measured the net value of assets held by residents of Eurozone countries in 2012, Estonian households had in average 21,000 euros worth of assets and citizens of Slovakia 19,000 euros per person. France was first with 206,000 euros and Finland for example tenth with 113,000 euros.

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Tourism services accounted for 7.4 pct of exports in 2012

The share of tourism services in the export of goods and services from Estonia was 7.4% in 2012, Enterprise Estonia said. The total value of export of tourism services was 1.24 billion euros last year, according to data from the Bank of Estonia. Exports were bigger by 32 million euros or 2.7% than the previous high from 2011. The export of travel services, or spending by foreign visitors in Estonia, grew 6% year on year to 950 million euros.

Foreign visitors paid Estonian transport companies 286 million euros in 2012, 6.6% less than in 2011. Payments to shipping companies decreased 1.4% and payments to airlines fell 31%. During the year, 1.87 million foreign visitors stayed at accommodation establishments in Estonia, 3.6% more than in 2011.

Foreign tourists spent 3.82 million nights in Estonia overall, 2% more than in 2011. In the two previous years the annual rate of growth was 17%. In 2012, tourism received a boost from new transport connections, aftermath of media coverage of the European Capital of Culture 2011, marketing by the private and public sector, and an overall upward trend in European tourism, Tarmo Mutso, chief of tourism development at Enterprise Estonia, said in a press release.

Just like in 2011, the number of tourists from Russia and of the nights spent by them in Estonian accommodation establishments grew the most last year, including in all counties of Estonia. The number of Russian tourists was 266 192, 31 % bigger than in the year before.

The share of the Finnish market in incoming tourism declined and overnight stays by Finns accounted for 43% of all overnight stays by foreign tourists. Finnish tourists numbered 829 225, 1.4% fewer than in 2011. A factor reducing demand was the rise of the prices of accommodation services to almost the pre-crisis level, Enterprise Estonia said.

Third place in incoming tourism belonged to Germany. Altogether German tourists spent 111 251 nights in accommodation establishments of Estonia, 7% more than a year ago. The increase in the number of nights spent by German tourists was the biggest in Tallinn.

Source: BNS news through Estonian Review

Head of Employers’ Confederation: labour taxation is a problem

Estonian industrialist Jüri Käo who was last week elected the new chairman of the Estonian Employers’ Confederation says that for employers the main problem is taxation of labour force.

Q: If you could influence the government policy, what would you change?

The main issue is taxation of labour force. If you look at other European countries, our labour taxes are very high. This is restricting business development in Estonia, new job creation and overall development.
Today, labour in Estonia is very highly taxed and this is putting us at a disadvantage in Europe.
Lack of qualified workforce is also becoming a major problem. All countries in Europe are competing for workforce. You must have a good business climate that helps enterprises to grow and workforce will come.”

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Bonnier to create a leading cinema business

Swedish privately owned media group Bonnier that is parent company of Äripäev and owns film distributor SF Bio and Ratos, owner of film distributor Finnkino, has agreed to merge their cineme distribution operations and form the Nordic region’s largest cinema group, announced the companies.

The new business will be owned 60 percent by Ratos and 40 percent by Bonnier. Finnkino operates in the Baltics under the name of Forum Cinemas. The new company will be operating in Sweden, Finland, Norway, Estonia, Latvia and Lithuania.

SF Bio is the biggest cinema group in Sweden. Finnkino Oy is the largest cinema operator in Finland and the Baltic states.

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Tallink may be delisted

This week Baltic Cruises Holding L.P., subsidiary of CVCI Growth Fund II that is large shareholder of Tallink Group since December 2012 paid another EUR 5.25m for buying more Tallink shares and now owns 16.5% of the ferry company, writes Äripäev.

This has again triggered speculations that the end objective of the new shareholder is to delist Tallink from the stock exchange.

In December 2012, Baltic Cruises Holding paid 116m euros for buying 15.7% of the shares of Tallink from large shareholders including Infortar.

One of the financial professionals who believes that this is all part of eventually delisting Tallink is Ago Lauri, board member of Kawe Kapital.

„Why buy a large block of shares at a high price, ban others to buy shares from the market and later give up a cheaper possibility to buy shares,” asks Lauri.

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Contracts becoming a burden to city government

City of Tallinn is already spending 5% of its annual budget on paying a small group of companies that have won private public partnership or PPP contracts from Tallinn for renovating the capital’s school buildings and building municipal houses, writes Äripäev.

By the new act on financial management of local governments, PPP amounts are included in the local government’s loan burden that cannot exceed 60% of the local government’s net budget revenues. City of Tallinn’s loan burden is at present 55%.
The businessmen who have entered into PPP contracts with the City of Tallinn include Jaanus Otsa, Olaf Herman, Tiit and Toomas Kõuhkna, Aivar Tuulberg and Raivo Rand.

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PM envious of salary of Enterprise Estonia’s new CEO

Estonian Prime Minister Andrus Ansip is convinced that 6,500 euros a month that the new head of Enterprise Estonia will be receiving is not justified, reported ERR.

“This is almost twice more than 2,890 euros that the head of PRIA, another agency that is distributing EU aid in Estonia, is receiving every month. Also the head of the Environment Investment Centre or KIK is receiving twice less. There can be no justification,” said the PM in the parliament’s Q&A yesterday.

Ansip added that while in general, a comparison with private sector salaries shows that heads of state enterprises are earning less than executives in the private sector, there were some organizations where top wages were unjustifiably high.

Ansip earns 3,999 euros a month as PM.

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Eesti Energia, Skype regarded as most attractive employers

Estonian state power company Eesti Energia is the most coveted employer in Estonia for job seekers, shows a survey by CV Keskus. Eesti Energia was followed by Skype and Elion (telecom).

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