By Denes Albert
BUDAPEST, Aug 28 (Reuters) - Hungarian busmaker NABI said on Thursday it expects to return to profit in the second half of 2003 despite continued sluggish conditions in its main United States market.
Chairman Peter Rona told a business conference organised by the Budapest Stock Exchange that NABI would be back in profit by the year-end after posting a first half loss of $9.97 million on sales of $147.4 million. He gave no specific forecasts.
Rona said the first half loss was mainly due to a delay in deliveries which had since been sorted out.
He said the company's order books were promising, though there was little sign of an upturn among the big U.S. cities that are a mainstay of the company's business.
"Our orders are still very strong, although the U.S. market shows some signs for concern," he said, noting financial conditions for U.S. municipalities were increasingly difficult.
He said this would increase competition for orders from the better-off municipalities, eroding potential margins.
Rona said development costs for NABI's lightweight CompoBus were beginning to bear fruit.
"With the CompoBus, we have a monopoly," he said. "U.S. prospects are not promising, but we can handle that."
He said NABI had recently won new orders for 400 buses, taking the total orderbook value to around $1.2 billion.
Rona also said NABI had to increasingly rely on developing its technologies as the economy's competitive position had steadily eroded -- partly due to a strong forint.
"By now, Hungary's competitiveness is gone, so what remains is technological development," Rona said.
At 1017 GMT, NABI shares were up 75 forints, or 3.3 percent at 2,350 forints, while Budapest's broader BUX index was up 0.85 percent. For main central European company news, double click on [.CEE] E.Europe hot stocks [HOT-EEU] Main E.Europe news [TOP/EAST] Related stories on [HU] [PL] [CZ] [EEU-STX] [EEU-RES] [EEU-E] For real-time index quotes, double click in brackets: Warsaw WIG20 Budapest BUX Prague PX50