Bloomberg News

Benefit Systems Jump as Erste Raises Estimate: Warsaw Mover

June 14, 2013

Benefit Systems SA, a Polish provider of employee-perk programs, headed for the highest in almost two months after Erste Group Bank AG raised its price estimate by 22 percent and maintained its buy recommendation.

The shares gained 4.8 percent to 264 zloty, the highest level on closing basis since April 17, by 12:25 p.m. in Warsaw, valuing the company at 635 million zloty ($201 million). Turnover was 224 percent the daily average from the last three months. Erste raised its price estimate for the company to 306 zloty from 250 zloty.

Benefit Systems seeks to diversify from its flagship Multisport card, which its clients buy to reduce gym fees for their employees, by starting a cinema tickets program as well as catering subscriptions. The Warsaw-based company also invests in fitness clubs by granting loans and buying stakes.

“Benefit continues its fast pace of top line growth, supported mainly by the acquisition of new clients for core products,” Marek Czachor, a Warsaw-based analyst at Erste, said in a report today. “The development of new business lines currently burdens the operating results, but we believe that this will create extra value in the coming years.”

Erste expects Benefit’s new investments to lead to an improvement of the company’s margins in 2015. Benefit Systems has gained 15 percent in 2013, compared with a 2 percent advance in Warsaw’s WIG Index.

To contact the reporter on this story: Piotr Bujnicki in Warsaw at pbujnicki@bloomberg.net

To contact the editor responsible for this story: Wojciech Moskwa at wmoskwa@bloomberg.net


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