MSE Index extends monthly gains
The MSE Index gained a further 0.8 per cent in February thus marking its third monthly gain, to close at 3,447.197 points. Turnover amounted to just under €6m spread across 20 equities of which 12 gained ground, five dropped in value and three closed unchanged.
Plaza Centres plc (Plaza) was the best performer having rallied by 23.9 per cent across 19 trades of 473,216 shares, to close at an all-time high of €0.85. On the other hand, Loqus Holdings plc (Loqus) headed the list of fallers as its share price stumbled by 14.2 per cent over nine trades of 30,486 shares, closing at €0.121.
Bank of Valletta plc shares were the most liquid having witnessed 329 deals worth €2.31m. The local bank's equity swayed between a monthly high of €2.15 and a low of €2.07, to ultimately close 1.4 per cent higher at €2.119. In its Interim Directors Statement for the period October 1, 2014 to February 6, 2015, the bank reported that financial performance was in line with expectations. Weak demand for business lending was offset by the high demand for home loans. Deposits grew despite the lower rates, resulting in higher liquidity. Commissions earned on the sale of financial products grew at a satisfactory rate. Meanwhile, costs were higher than the last year due to higher regulatory costs applicable under the Deposit Compensation Scheme.
Conversely, HSBC Bank Malta plc shares declined by 6.5 per cent as 139 trades of 512,767 shares were struck, closing €0.13 lower at €1.87. The Group registered a profit before tax of €52m for the year ended December 31, 2014, compared to €90m registered in 2013. Net interest income amounted to €120 million, a decline of 4 per cent from 2013. The key contributors to the decline in profitability were a €19m increase in loan impairment charges resulting principally from lower valuations on legacy commercial properties; a €14m decrease in income associated with the challenging operating environment and lower non-recurring revenue items; and a €5m rise in costs primarily due to regulatory fees and additional compliance investment. The Board is recommending for the approval of the Annual General Meeting (AGM) a final gross dividend of 2.6 cents per share (1.7 cents net of tax). This will be paid on April 24, 2015 to shareholders on the bank's register of shareholders as at March 23, 2015. The Board is also recommending a bonus issue of one share for every nine shares held by shareholders on the bank's register as at the close of business on April 29, 2015.
FIMBank plc added on to the previous months' declines as its share price fell a further 10.9 per cent, to close at its monthly low of $0.49. The trade finance bank was active over 16 transactions of 70,662 shares. Meanwhile, Lombard Bank Malta plc shares closed unchanged at €1.92 as 21 trades of 66,325 shares were negotiated.
Malta International Airport plc (MIA) shares appreciated by a staggering €0.36 or 14.4 per cent across 50 trades of 193,434 shares, ending the month of February at its all-time high of €2.86. The local airport operator hosted 208,903 passengers in February - a 4.8 per cent increase over January 2014. MIA has the third most international connections among 136 airports in its class, with over 50 destinations served in its winter schedule. The airport has been ranked the fourth best in Europe according to the 2014 Airport Service Quality (ASQ) Awards. Furthermore, the airport obtained its best score ever, with an overall passenger satisfaction score of 4.22 on a scale from one (poor) to five (excellent).
MIA reports that the group registered a profit before tax of €26.06m for the year ended December 31, 2014, compared to €22.67m registered in 2013. Revenue amounted to €64.29m, a rise of 9.7 per cent from 2013. Earnings per share increased to €0.1244 cents. The Board of Directors is recommending to shareholders the approval of the payment of a final gross dividend of €0.123077 (net €0.08) per share. This dividend shall be paid to all shareholders on the company's share register as at close of business on April 20, 2015. This together with the interim gross dividend already paid of €0.046 (net €0.03), amounts a total gross dividend of €0.169 (net €0.11) per share.
Simonds Farsons Cisk plc shares rose for the seventh consecutive month as the equity was negotiated over 12 transactions of 22,032 shares, closing at a record high of €3.20 - 3.6 per cent higher than January's closing price.
Likewise, MaltaPost plc shares advanced by €0.05 as 14 trades of 42,258 shares were negotiated, closing at its all-time high of €1.36. In its Interim Directors Statement, the postal service company announced that during the period October 1, 2014 till February 11, 2015 it registered an improvement in its financial performance when compared to that of the corresponding period last year. The company's turnover registered an increase which was mainly due to new service offerings and the revision of certain tariffs, which came into effect on January 1, 2014. However, the increase in profitability was partially offset by higher staff costs and inflationary pressures on operating costs. Letter mail volumes continued on their long-term downward trend while parcels and packets registered growth, especially over the Christmas period.
Similarly, Malita Investments plc (Malita) and Tigne Mall plc shares closed February at their all-time highs of €0.77 and €0.70 respectively. The former appreciated by 16.3 per cent over 27 deals of 181,283 shares, while the latter rose by 7.7 per cent and was traded over eight deals of 120,800 shares. Malita reported that it has registered a pre-tax profit of €20.9m for the year ended December 31, 2014, compared to €10m in 2013. The results for the year include a favourable change in fair value on Malta International Airport and Valletta Cruise Port properties of €15.7m which came about due to the downward movement of interest rates. The directors resolved to recommend the payment of a final net dividend of €0.01365 per share which will be paid on April 24, 2015 to the shareholders on the company's register as at close of business on March 23, 2015.
In the I.T. sector, RS2 Software plc shares declined by €0.03 or one per cent as 11 deals of 51,263 shares were negotiated, closing at €2.95. Meanwhile, Crimsonwing plc shares edged 1.3 per cent higher across four trades of 15,643 shares, to close at €0.855. The company announced that in connection with the offer received from KPMG Investments Malta Limited for a voluntary public takeover bid, all trading in Crimsonwing shares was suspended with effect from close of trading on February 3, 2015. The managers, registrars and collecting paying agents of the offeror's bid have completed the transfer of all remaining shares which the offeror is not precluded from acquiring. The offeror is reserving the right to squeeze-out the remaining shares at subsequent stages.
GO plc shares soared by €0.075 as 89 trades of 235,843 shares were executed, closing 2.9 per cent higher at €2.675. Middlesea Insurance plc shares registered a two per cent gain over 30 trades of 68,294 shares, to close at €1.01. Likewise, MIDI plc shares partially erased January's decline having edged 2.2 per cent higher over 13 deals of 374,500 shares, closing at €0.235.
International Hotel Investments plc (IHI) shares advanced by 4.8 per cent as 102,692 shares changed hands, to close at €0.65. Meanwhile, Island Hotels Group Holdings plc shares closed unchanged at €1.02 as six transactions of 11,000 shares were struck. The company reported that the group registered a profit before tax of €2.8m for the year ended October 31, 2014, compared to €0.7m registered in 2013. Revenue for the period under review amounted to €36.6m, a rise of 19.2 per cent on 2013. In view of the proposed transaction with IHI, the directors did not propose the payment of a dividend for the year.
The other non-movers for the month were Grand Harbour Marina plc shares having traded flat at €1.75 over three deals of 9,200 shares. On a negative note, Medserv plc shares slipped by €0.05 or 3.4 per cent across five trades of 158,500 shares, closing at €1.42.
In the corporate bond market turnover amounted to €5.7m. A total of 41 issues were active of which 18 gained ground, 14 declined and nine closed unchanged. The 5.8% IHI 2021 registered the highest gain of 5.1 per cent, closing at €103. Conversely, the 7.15% Mediterranean Investments Holding plc USD 2015-2017 was the worst performer as it decreased by 2.3 per cent, to close at $85.
In the sovereign debt market 27 issues were active of which short-term issues marginally fell, while long-dated issues registered sizeable gains. Namely, the 4.1% MGS 2034 (I) r appreciated by 1.4 per cent, closing at €120.99, while the 6.1% MGS 2015 decreased by 0.4 per cent, to close at €101.65.
During the month of February, the Treasury issued two new Government Stocks to the general public of €120m subject to an over-allotment option of €60m. The stocks offered have a coupon of two per cent and three per cent and will mature in 2020 and 2040 respectively. The 2% MGS 2020 (V) F.I. (March 2015) was issued at €105.75 thus having a yield to maturity of 0.937 per cent, while the 3% MGS 2040(I) was issued at €100. Due to strong demand for the stocks offered, the application process closed on the first day of subscription. The Treasury received a total of 11,701 applications representing a total aggregate nominal value exceeding €443.2m.
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]