HSBC shares drag index back in the red
MSE Trading Report for week ending February 27, 2015
The MSE Index failed to maintain the past two weeks’ positive streak reflecting a hefty decline in the share price of HSBC Bank Malta plc following the announcement of a drop in profits in 2014. The decline in the index was however kept to a slight 0.33 per cent as significant gains were recorded in eight equities.Turnover appreciated from €1.35m to €2.01m as transactions were spread on 17 equities.The index gained 0.8 per cent in February.
Last Monday, HSBC Bank Malta plc released its annual results for the year ended December 31, 2014. The Group registered a profit before tax of €52 million, compared to €90 million registered in 2013. Net interest income for the period under review amounted to €120 million, a decline of 4% 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.Earning per sharedecreased to 10.4 cents.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 who are on the bank’s register of shareholders on 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 share register at the close of business on April29,2015 and shares will be available for trading on April30,2015.
Investors reacted negatively to the results as by Thursday’s session the equity had declined by 10 per cent to then recover by 2.75 per cent on Friday. In fact, trading ranged between a high of €2.02 and a low of €1.80 to finally end the week 7.4 per cent lower at €1.87. A total of 304,056 shares changed hands on a turnover worth almost €587k.
On the other hand, Bank of Valletta plc shares registered a marginal gain of 0.38 per cent on the highest turnover for the week of €723.5k as 341,296 shares were dealt. Lombard Bank Malta plc shares managed a 1 per cent gain on three deals of 5,271 shares as trading fluctuated between the €1.825 and the €1.92 price level, at which it closed. Meanwhile, four deals in FIMBank plc kept its price intact at $0.49 with only a slight movement intra-week.
On a positive note, fresh highs were recorded in three equities, namely Simonds Farsons Cisk plc, Malta International Airport plc and Tigne Mall plc, while Plaza Centres plc held on to its previous week’s all-time high.
Shares in Simonds Farsons Cisk plc climbed by 2.56 per cent on Tuesday to a new high of €3.20 – a level it then maintained on higher volumes on Friday. Meanwhile, Plaza Centres plc maintained the €0.85 price level throughout the week as 135,740 shares were traded – on the month Plaza shares rank first having surged by 24 per cent.
Solid gains were registered in the share price of Malta International Airport plc resulting in a weekly gain of 9.6 per cent or €0.25. The steepest gain was recorded during Thursday’s session as investors reacted to the announcement of company’s financial statements for the year ended December 31, 2014. The company reportedthat the Group registered a profit before tax of €26.06m, compared to €22.67m registered in 2013. Revenue for the period under review amounted to €64.29m, a rise of 9.36% from 2013. Earning per shareincreased to €0.1244 cents.
The board of directors have also approved 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 after settlement as at close of business on April 20, 2015. This together with the interim gross dividend already paid of €0.046 (net€0.03), amountsa total gross dividend of €0.169 (net €0.11) per share.
A single deal of 700 shares in Tigne Mall plc pushed its share price up 4.32 per cent to a new high of €0.70.
Meanwhile, International Hotel Investments plc continued to recover lost ground registering a 3.2 per cent gain on a volume of 40,727 shares to close at €0.65. Also on the up side were shares of GO plc with a marginal 0.2 per cent gain as 30,633 shares changed ownership, closing at €2.675. Finally, three deals in Loqus Holdings plc led to a 0.83 per cent gain to end the week at €0.121. The Company announced that the Group registered a turnover of €1,8m compared to €1,7min 2013 over the six months ended 31 December 2014.The Group registeredaloss of €117,556for the six monthscompared to a loss of €135,207 for the same period in2013.
Elsewhere, the share price of RS2 Software plc eased 0.67 per cent to €2.95 on a single deal of 8,500 shares. A decline of 0.87 per cent was also noted in the share price of Island Hotels Group Holdings plc, closing at €1.02 on two deals of 5,000 shares. Last Tuesday, the company’s board of directors released the company’s financial statements for the year ended October 31, 2014.
The Group registered a profit before tax of €2.47 million, compared to €0.69 million registered in 2013. Revenue for the period under review amounted to €36.56 million, a rise of 19.2 % on2013. Earnings per sharefrom continuing operations increased to €4.2 cents. In view of the proposed transaction with International Hotel Investments plc, the directors didnot propose the payment of a dividend for the year.
This week’s non-movers were Middlesea Insurance plc, Grand Harbour Marina plc, MIDI plc and Malita Investments plc on varied trading volumes. Last Thursday, Malita Investments plc reported the company’s financial statements for the year ended December 31, 2014. The company registered a pre-tax profit of €20.85m 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 €15.7mwhich 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 on the company’s register as at close of business on March 23, 2015.
In the corporate bond market, activity was spread across 31 issues reaching a turnover of €1.26m – 15 issues registered gains, five fell in value and 11 closed flat. The worst decline was noted in the 4.8% Bank of Valletta plc Notes 2018 having declined by 3.2 per cent to €106. On the other hand, the 6.2% Tumas Investments plc €2017-2020 registered a 2.56 per cent gain to end the week at €108.
In the sovereign debt market, a total of 27 issues were active of which 21 long dated issues ended the week in positive territory while the remaining six short-dated issues fell slightly. Turnover in this market soared to €58.2m from €25.9m last week. Trading in the 3.75% MGS 2015 (VI) issue accounted for €25.1m of the total turnover.
In a press release on Monday, the Treasury announced that due to strong demand for the stocks offered in the latest Malta Government Stock issuance, the subscription in the Malta Government Stock was brought to a close on the first day of subscription. Meanwhile onThursday, the Treasury announced that it had received 11,701 applications representing a total aggregate nominal value exceeding €443.2 million from members of the public and shall be announcing the allotment policy in due course.