MSE Index ends June at 7-year high

The MSE Index soared by 5.5 per cent throughout the month of June, to close at 4,090.619 points, thus ending Q2 8.3 per cent higher. Turnover amounted to €6.6m and was spread across 18 equities of which 11 increased - six of which registered double-digit gains, six fell and one closed unchanged.

Mapfre Middlesea plc shares were the top performers having rallied by €0.425 or 30.4 per cent across 44 deals of 71,813 shares, closing at a multi-year high of €1.825. This positive performance followed the company's announcement that it reached a preliminary agreement with Allcare Insurance Limited for the transfer of the insurance portfolio of Allcare Insurance Limited. This agreement is subject to all regulatory approvals from the relevant authorities and was forwarded for approval to the MFSA on June 3, 2015. The Board of Directors of the company is scheduled to meet on July 22, 2015 to consider and approve the interim financial statements for the half-year ended June 30, 2015.

Simonds Farsons Cisk plc shares followed suit, having appreciated by a substantial 20 per cent as seven deals of 3,854 shares were struck, closing at a record high of €4.50. In the company's Interim Directors' Statement the Board reported that trading for the first quarter of the financial year has been steady and in line with expectations. The peak summer months remain a critical period in determining the profitability of the Group. The development of the new state-of-the-art €27m beer packaging facility is advancing on schedule and is planned to be completed by April 2016.

Meanwhile, Medserv plc shares registered an increase for the fourth consecutive month, having climbed by 9.5 per cent as 39 deals of 131,685 shares were struck, closing at an all-time high of €2.355.

RS2 Software plc shares advanced by €0.284 or 16.8 per cent - after adjusting for the 2-for-1 share split. The I.T. operator's shares were the most liquid, having witnessed a turnover volume of 608,425 shares worth €1.256m, to close at an all-time high of €1.974.

In the same sector, 6PM Holdings plc announced that it has submitted an application to the Listing Authority of the MFSA requesting the admissibility to listing of €13m in bonds redeemable in 2025. Subject to approval, the Issuer will be granting preference to shareholders listed in the share register as at June 8, 2015.

In another announcement, the company reported that it has entered into a share transfer agreement (STA) to acquire all the issued share capital in Blithe Computer Systems Limited from Mr Peter Wright - the current sole shareholder for the total consideration of £4.2m. The STA is conditional upon the company raising enough funding through the issue of €13m in new bonds redeemable in 2025. The equity was not active in June.

Meanwhile, Loqus Holdings plc shares increased by 7.4 per cent over a sole transaction of 1,750 shares, closing at €0.13.

Bank of Valletta plc shares oscillated between a monthly low of €2.261 and a high of €2.30, at which it closed. The banking equity was negotiated across 240 trades of 518,796 shares. Similarly, FIMBank plc shares edged 0.2 per cent higher over 16 transactions of 173,434 shares, closing at $0.466.

On the other hand, Lombard Bank Malta plc shares registered a 2.5 per cent decline as 14 transactions of 65,478 shares were struck, closing at €1.821. The Board of Directors of the bank will be meeting on August 25, 2015 to consider and approve the group's and the bank's financial statements for the half year ended June 30, 2015.

Meanwhile, HSBC Bank Malta plc shares dipped by 0.6 per cent as 412,143 shares changed ownership, to close at €1.80.

Also on the down side, Malita Investments plc shares declined by €0.06 or 6.3 per cent over 33 trades of 143,436 shares to close at €0.90.

Tigne Mall plc shares appreciated by 6.3 per cent as 10 deals of 48,000 shares were executed, to close €0.05 higher at €0.85. Conversely, Plaza Centres plc shares declined by one per cent across 16 trades of 165,658 shares, closing at €0.97.

Malta International Airport plc shares eased 0.9 per cent over 73 trades of 134,914 shares, closing at €3.33 - registering a 2.6 per cent decline for Q2. The local airport operator registered an increase of 9.9 per cent in passenger traffic in May 2015, compared to May 2014 welcoming a record number of 441,943 passengers in May. During summer, the airport will introduce two new routes to Helsinki and Warsaw, five new airlines and a number of additional frequencies.

GO plc shares, registered an increase of 12 per cent in June and 6.2 per cent in Q2. The telecommunications provider's shares witnessed 136 deals of 370,245 shares, closing at €3.425. Subsequent to the company's announcement on May 5, 2015, declaring the company's intention to reorganise its corporate structure, the Board of Directors will be convening an Extraordinary General Meeting, which will be held on July 22, 2015, to discuss the matter and to consider and seek approval of various resolutions. 

MIDI plc shares extended their recent winning streak, having increased by 12.7 per cent over 20 deals of 288,087 shares, closing at €0.338. Conversely, Grand Harbour Marina plc shares fell by 0.8 per cent across eight trades of 28,156 shares, to close at €1.875.

International Hotel Investments plc (IHI) shares rallied by 11.5 per cent as 669,277 shares changed ownership, closing €0.09 higher at €0.87. The company now completed its due diligence exercise with reference to the execution of a conditional agreement for the acquisition of all the issued share capital of Island Hotels Group Holdings plc (IHGH). The voluntary bid will be made by IHI in respect of all the issued shares in IHGH, and will be set out in an offer document to be issued by IHI on or around July 1, 2015. The consideration to be offered will consist in either a combined consideration or a cash alternative.

Island Hotels Group Holdings plc (IHGH) announced that the company has completed the purchase and acquisition of the remaining 50 per cent shareholding in Buttigieg Holdings Limited (BHL). BHL is the parent company of the 100 per cent owned subsidiaries R.J.C. Caterers Limited - operating mainly in the retail and contract catering sector; and The Coffee Company Malta Limited and The Coffee Company Spain -  operating the Costa Coffee franchise in Malta and the Eastern Coast of Spain and the Balearic Islands. In consideration, the company shall be issuing 2m new shares to the selling shareholders pro-rata to the number of shares they transferred to the company. The total issued share capital of the company will therefore increase to 387,583,660 shares of €1 each. This increase will have no dilutive effect on existing shareholders with respect to the proposed transaction with IHI.

The directors also presented their interim report, together with the unaudited interim condensed financial statements of the group for the six months ended 30 April 2015. During the six months ended 30 April 2015 the group reported (under the new accounting rules) a turnover from continuing operations of €2.06m, compared to €4.63m in 2014 and loss before interest, taxation, depreciation and amortisation from continuing operations of €927,020 compared to €265,894 in 2014. IHGH shares have not been active since March 25, 2015.

The only non-movers for June were MaltaPost plc shares, failing to maintain their monthly and all-time high of €1.555, having closed unchanged at €1.50. The postal service operator's shares were negotiated over nine trades of 12,737 shares.

In the corporate bond market turnover amounted to €3.6m and was spread across 38 bonds of which 28 gained ground, six fell and four closed unchanged. The 5.3% United Finance plc unsecured € Bonds 2023 headed the list of gainers, having increased by 5.7 per cent, to close at €110.67.

Mediterranean Investments Holding plc (MIH) has filed an application with the Listing Authority of the MFSA requesting admissibility to listing of €20m 5.5% unsecured bonds redeemable in 2020, to be issued at par. Subject to approval and effective admission, the net proceeds will be used by the issuer to redeem the €20m 7.5% MIH unsecured bonds 2015. The issuer will be granting preference to the holders of the maturing bonds to subscribe to the new bonds by surrendering the maturing bonds.

In the sovereign debt market a total of 30 issues were active, all of which declined - with the longer-dated issues recording the most significant decline. Namely, the 4.1% MGS 2034 (I) registered the worst loss, having declined by 6.7 per cent, to close at €121.89. Meanwhile, the 4.5% MGS 2028 (II) was the most liquid issue, having witnessed a turnover of just under €21m.

This article, which was compiled by Jesmond Mizzi, Managing Director of Jesmond Mizzi Financial Advisors Limited, does not intend to give investment advice and the contents therein should not be construed as such. The Company is licensed to conduct investment services by the MFSA and is a Member Firm of the Malta Stock Exchange and a member of the Atlas Group. The directors or related parties, including the company, and their clients are likely to have an interest in securities mentioned in this article. For further information contact Jesmond Mizzi Financial Advisors at 67 Level 3, South Street, Valletta, or on Tel: 21224410, or email [email protected]