PBG drops on share issue plans, uninspiring forecast

By Chris Borowski

WARSAW (Reuters) - Shares in Polish builder PBG dropped more than 5 percent on Wednesday after the company said it was considering a share issue and gave an uninspiring forecast for 2008.

PBG, which like other Polish construction companies has benefited from speedy growth in the sector, said it could issue as many as one million shares worth up to $180 million in the second half of 2008 to fund new projects.

"If it turns out that we win large contracts then we'll need capital to fulfil them," chief executive Jerzy Wisniewski told a news conference.

"Without a new issue prospectus we can issue one million shares which would be worth 300-400 million zlotys at current prices."

PBG currently has 13.4 million shares.

The construction group, which is seeking to expand beyond its core business of building gas and oil installations, said it expects its revenue to rise 40 percent this year to 1.9 billion zlotys ($850.9 million).

It sees its earnings at 143 million zlotys.

"This forecast is disappointing because I expected them to grow a little faster. And the new shares will water down the current shareholders a little," said a Warsaw-based analyst.