/Daiga Auziņa-Melalksne, Chairman of the Management Board, NASDAQ OMX Riga, AS/
/Kārlis Krastiņš, Chairman of the Management Board, AS IBS Prudentia/
Prudentia together with Nasdaq Riga have prepared another TOP 101 of Latvia’s most valuable enterprises and continues to implement this socially important initiative, which aim is to provide support to the development of education within society, encourage the growth of nascent entrepreneurs and provide understanding about company’s value and meaning of qualitative corporate management.
Overall, this year's TOP101 has brought good news – mostly the value of the enterprises has increased. It has been affected by company’s cash flow and profitability indicators improvement, as well as stock exchange share price rises in Europe. Positive changes can also be witnessed in the evaluation of Corporate Governance practice.
We should especially point out the value increasment in timber industry companies and banking sector. Withing timber companies in 2013 are observed high improvement in EBITDA (earnings before amortization, depreciation, interest expense and income taxes), even greater impact has left the European exchange share growth in 2014. Banks in 2013 have shown a good profit and equity increasement, which is a base for value growth.
In terms of state-owned enterprises, which traditionally have gained high places in TOP 101 of Latvia’s most valuable enterprises, - for those enterprises corporate management is specially important, since those enterprises play big role in Latvian economy as an employers and works in important national economic sectors and produces signicant part of GDP. If we compare the best global practice in the management of state assets, we can make conclusion that the value potential of many state-owned enterprises is still not fully fulfilled. However, companies in which the state works alongside with he private shareholder, management level is approaching the best global pratice. Observance of good corporate management principles depends on shareholders’ understanding about its importance and proper motivation, especially in companies with dominant shareholder. World practice shows that well-managed companies are more competitive because they can involve capital in more favourable terms and thus compete better not only in Latvia, but also Baltic level.
However, we once again emphasize that TOP 101 is its organizers opinion about enterprise value, it is not a price which can be used when selling or buying these companies. Price is determined by the buyer and seller in a particular transaction.
