MSE Index maintains upward momentum
The Malta Stock Exchange (MSE), advanced by 2.98 per cent on the month as significant gains were registered by Medserv plc, Mapfre Middlesea plc (MMS), RS2 Software plc (RS2), and Bank of Valletta plc (BOV), thus pushing the MSE Index to a fresh seven year high, at 4,333.534 points. Declines in the share price of Plaza Centres plc (Plaza) and Malita Investments plc (Malita) weighed the MSE Index slightly lower.
Activity was spread across 18 equities, of which 12 advanced, four lost ground, and two remained unchanged. Total turnover fell by 26 per cent month-on-month, to €4.6m.
The logistics and services company for oil and gas, Medserv recorded the best performance for the month as its share price rallied by 23.8 per cent, to an all time high of €3.095, following 35 trades of 106,050 shares. During the month, the company announced that an Extraordinary General Meeting (EGM) will be held on October 12, 2015 to approve a resolution to authorise the Company to disclose to any bona fide offeror such information in relation to the Medserv group of companies, including unpublished price-sensitive information, as may be necessary to enable any bona fide offeror and its advisers to make, confirm, withdraw or modify any bona fide offer made to Medserv p.l.c.
Meanwhile, FIMBank plc shares headed the financial services sector with a solid gain of 10 per cent, which more than offset the 9.1 per cent decline recorded in the month of August. The equity traded after four weeks of inactivity, and closed the month at $0.495, over 15 deals of 120,571 shares.
In the same line of business, Mapfre Middlesea plc continued to trend higher for the eight consecutive month as 28 deals of 33,282 shares pushed the share price eight per cent higher to a six and a half year high at €2.279. During the month, the company announced that Mr Felipe Navarro Lopez de Chicheri has been appointed Chief Executive Officer, with effect from October 1, 2015, in lieu of Mr Alfredo Munoz Perez, subject to regulatory approval.
Moreover, BOV shares appreciated by 5.3 per cent to close the month at €2.37, over the highest turnover of the month, worth €1.07m, representing 23 per cent of total turnover. Mid-month BOV announced that it has proceeded with the submission of an application for the approval of a prospectus for a 12-month Subordinated Debt Issuance Programme of a maximum principal amount of €150m. The Notes to be issued will form an integral part of BOV's capital plan, aiming to strengthen Tier 2 Capital as required by European banking regulations. The next Annual General Meeting (AGM) will be held on December 17, 2015.
Its peer, HSBC Bank Malta plc witnessed no change to its share price having closed unchanged at the €1.80 price level over a turnover worth €465k. HSBC announced that Mr Mark Watkinson will be relinquishing his post as Chief Executive Officer with effect from November 2, 2015. Mr Watkinson will be replaced by Mr Andrew Beane, who is currently Chief of Staff to the CEO of HSBC Europe, Middle East & Africa. Mr Beane will take up his new position subject to regulatory approval.
Meanwhile, the share price of Lombard Bank Malta plc added a further 1.1 per cent to the 3.2 per cent increase recorded the previous month to close at €2.138, as 29 deals of 165,720 shares were struck.
In the IT services sector, RS2 Software plc maintained its upward momentum as its share price advanced to €2.51- €0.01 shy of its all time high of €2.52 - up by 9.6 per cent on the month. The equity was active across 57 trades of 186,974 shares. Meanwhile, the share price of 6pm Holdings plc remained unchanged at £0.70, as 10 deals of 76,504 shares were negotiated.
Elsewhere, Grand Harbour Marina plc shares notched a 5.8 per cent gain over the month, as a single trade of a scant 2,000 shares was executed at €1.00. Over the month, the company published the half yearly report for the period ending June 30, 2015. The Group reported a profit before tax of €0.08m, compared to €0.02m registered in 2014. The company reported an income tax charge for the period ended June 30, 2015 of €118k - thus resulting in a loss after income tax of €0.037m.
Meanwhile, MaltaPost plc shares maintained their upward trend as the equity closed the month 3.9 per cent higher at an all time high of €1.70, as 7,146 shares changed hands over four deals.
On the back of positive interim results, Simonds Farsons Cisk plc (SFC) notched a nine month winning streak having extended its gains by a further 1.1 per cent to an all time high of €5.611, over a turnover worth €46k. During the month, SFC announced that for the six months ending July 31 2015, the Group recorded a profit before tax of €4.8m, compared to €4.2m registered in 2014. Revenue for the period under review amounted to €44.2m, a rise of 7.8 per cent from 2014. Earnings per share increased to €0.211. The Group also announced an interim dividend of € 0.0333 per ordinary share which shall be paid on October 20, 2015 to ordinary shareholders who are on the register as at October 6, 2015. The Group's positive results were mainly due to a buoyant performance of the local economy, particularly tourism, successful marketing of the beer portfolio, an increase in imported beverages and an improved performance from the franchised food business.
Malta International Airport plc shares partially recovered last month's 2.8 per cent decline as its share price climbed 0.3 per cent to €3.851 as 44 trades of 59,611 shares were concluded. The company announced that traffic reached an all-time high for the month of August with 585,218 passenger movements.
During the month, SFC, MIA and BOV announced the execution of a share purchase agreement for the sale of their shares in Valletta Cruise Port plc (VCP). SFC through its holding in FSG Company Limited (in which it owns 50 per cent), together with MIA and BOV have sold 30.97 per cent shareholding in VCP to Global Liman İşletmeleri A.Ş. (GLI), a 100% subsidiary of Global Yatırım Holding A.Ş. The successful completion of the transaction is subject to legal and regulatory approvals and the waiver of the pre-emption rights by the remaining shareholders of VCP to allow the transaction to be completed in accordance with the terms agreed in the share purchase agreement. The total consideration for the shares will be announced following the successful completion of the conditions precedent and closing of the transaction.
Among the list of gainers, International Hotel Investments plc shares moved 1.3 per cent higher to close the month at €0.80, over 39 trades of 463,358 shares. The latter announced that a three per cent bonus share issue has been approved in favour of shareholders appearing on the company's register as at close of business on October 15, 2015. The bonus share distribution is to be made out of capital reserves of the company and will be issued on a pro rata basis.
In the property sector, MIDI plc recorded a 2.9 per cent gain as its share price climbed to a 44-month high of €0.36, over 14 trades of 170,000 shares. During the month, the company announced its half-yearly financial report covering the six months ended June 30, 2015. MIDI registered a loss before tax of €0.64m which is expected to be reversed once the sale of Q1 apartments (the new block) is processed. Meanwhile, profits after tax amounted to €3.22m, due to a net deferred tax credit of €3.9m. Revenue for the period under review amounted to €6.63m, compared to €782K for the same period in 2014. Moreover, MIDI announced that it had acquired Siemens' 50 per cent shareholding in Solutions & Infrastructure Services Limited (SIS) for the consideration of one euro. The agreement further contemplated the waiver by Siemens of €350k which was due to it by (SIS) by way of a shareholders loan; and an informal capital contribution made by Siemens to SIS of €1.742m as part of a restructuring exercise. The development currently underway at Tigne Point, were awarded to Siemens with whom an agreement was reached for a credit of €1m. The company believes that this development will turn around the current forecasted losses to be incurred by SIS, for the financial year ending September 30, 2015. Being that SIS is now a wholly owned subsidiary of the MIDI group, the Company shall act as a surety for the repayment of SIS' banking facilities.
On the other hand, Plaza shares gave back most of last month's 10.5 per cent gain as seven trades of 180,412 shares dragged its share price to €0.98 - a 6.7 per cent drop. Similarly, Malita shares plunged by 6.4 per cent to €0.88, following 11 deals of 128,350 shares.
In the same line of business, the share price of Tigne Mall plc fell by 2.2 per cent to €0.91over a thin volume of 9,500 shares.
The share price of GO plc shed a further one per cent to close at €3.459 as the equity was traded over the second highest turnover, worth 731k. The company announced that an Extraordinary General Meeting (EGM) will be held on October 29, 2015 to approve a resolution of authorisation to seek bids for the Company's entire issued share capital and to disclose information, including price sensitive information, as considered appropriate.
During the month Global Capital plc announced that EIP plc has informed the Company that since the expiry of the Share Purchase Agreement, on September 10, EIP had received no further communication from BAI Co (Mtius) and that no new agreement has so far been executed between EIP and BAI. The Company is informed that the original transaction has not been completed; however EIP is still intent on acquiring a shareholding in the Company and committed to support any capital increases, up to the sum of €15m. Thus, the Directors consider the going concern basis in the preparation of the Company's financial reports as appropriate. Moreover, the Annual General Meeting of the Company was held on September 16, 2015 at which new directors were appointed and a number of resolutions were addressed.
The Listing Authority also announced that sufficient information has been made public by the Company for trading in Global Capital plc's securities to be resumed, thus terminating the suspension of Listing and Trading in the Company's securities.
On the corporate bond front, out of the 35 traded issues, 13 advanced, 19 declined and three remained unchanged. Total turnover dropped by 53 per cent from €8.53m to €3.98m. The 4.8% Bank of Valletta Plc Sub € 2020 issue recorded a 3.1 per cent gain on the month as the bond price climbed to €107.50 over seven deals of 89,400 nominal. Meanwhile 14 trades of 39,900 nominal in the 5.75% International Hotel Investments plc Unsecured € 2025 issue dragged the bond price 4.5 per cent lower to €105.11. The highest liquidity was witnessed in the 5.1% 6PM Holdings plc Unsecured € 2025 with a turnover worth €1.06m. The bond advanced by 0.01 per cent to €109.01.
In the sovereign debt market, 28 issues were active, of which 15 headed north and 13 lost ground. The 4.45% MGS 2032 (II) headed the list of gainers with a 1.4 per cent gain to €129.98 as 25 trades of 451,600 nominal were executed, while the 3.3% MGS 2024 (I) inched 0.8 per cent lower to close the month at €114.33 over a single trade of 50k nominal. The 4.5% MGS 2028 (II) issue was active over a turnover of €23.4m - 41.8 per cent of the total turnover, which stood at €56.09m.
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]