Equity index turns positive

MSE Trading Report for week ending May 22, 2015

The MSE Index advanced by a substantial 1.56 per cent this week, to close at 3,841.516 points, following last week’s decline. Activity was spread across 15 equities of which two fell, five closed unchanged and eight advanced – five of which closed at their record high. Turnover amounted to €1.4m.

International Hotel Investments plc (IHI) shares soared by €0.07 or 10.3 per cent as 16 deals of 174,960 shares were struck, to close at €0.75 – having traded at a high of €0.78 and a low of €0.68. This significant rally occurred on Friday following a press conference held by the Corinthia Group regarding its plans to develop a six-star hotel on the site currently occupied by the San Gorg Corinthia, the Corinthia Marina and Radisson Blu in St Julians.

Simonds Farsons Cisk plc shares similarly surged by an impressive €0.225 as five deals of 1,149 shares were negotiated, to close 6.4 per cent higher at an all-time high of €3.75. Likewise, RS2 Software plc shares closed at a record high of €3.30 thus registering an increase for the seventh consecutive week as 64,069 shares changed ownership. The I.T. equity advanced by €0.121 or 3.8 per cent.

Meanwhile, Medserv plc shares were negotiated across four trades of 9,075 shares, closing 2.1 per cent higher at an all-time high of €2.20. On a similar note, MaltaPost plc and Tigne Mall plc shares closed unchanged at their all time high of €1.50 and €0.80 respectively. The former was negotiated across seven transactions of 14,000 shares, while the latter witnessed four deals of 35,666 shares.

In the banking sector, Bank of Valletta plc shares were the only negative performers, having declined by €0.03 or 1.3 per cent as 47 deals of 93,069 shares were executed, closing at €2.27.

Conversely, FIMBank plc shares increased by a further two per cent over three trades of 26,192 shares, closing at $0.46. In the bank’s Interim Directors’ Statement, it was noted that liquidity and funding have been maintained at very prudent levels during the last few months. However, the Board anticipates growth of new business opportunities during the next six months. The winding down process to exit from factoring business in Russia has continued and discussions are being held to pursue various options including a sale of this business, although the costs of this exit are likely to have additional impact in 2015.

The business of India Factoring & Financial Solutions Limited, a major contributor to the Group’s losses in 2014, is now much more stable and whilst new impairments were experienced in 2015, these related to legacy issues which were largely anticipated. FIMBank Solo experienced some relatively small increases in net impairments, but the Group’s overall impairments were in line with the 2015 budget. The Board believes that the core fundamentals are being enhanced in order to return the Group to sustainable profit levels within a relatively short timeframe.

Lombard Bank Malta plc shares oscillated between a weekly high of €1.98 and a low of €1.95, to ultimately close the week 1.5 per cent higher at its weekly high. The banking equity was negotiated across four deals of 4,517 shares. In the bank’s Interim Directors’ Statement the Directors reported that

during the first four months of this financial year the Bank reported a decline in profit after tax compared to the same period in 2014. In line with traditionally cautious provisioning policy, Impairment Allowances were increased to provide for lending situations that, by the nature of the underlying business, require extended time to mature. The Boardis confident that the bank will provide a satisfactory half-year result within the context of the challenging environment that is currently being faced by the banking sector.

Meanwhile, HSBC Bank Malta plc shares closed the week unchanged at€1.85 as 69 trades of 228,796 shares were struck. The Board of Directors of the bank is scheduled to meet on August 3, 2015 to approve the group’s and the bank’s interim accounts for the half-year ending June 30, 2015 and to consider the declaration of an interim dividend.

GO plc shares edged 1.2 per cent higher as 45,510 shares changed hands, closing €0.035 higher at €3.025. Similarly, Santumas Shareholdings plc shares increased by a minimal 0.3 per cent across two transactions of 10,000 shares, to close at €2.

On the other hand, Malta International Airport plc slipped 2.64% to close at €3.359, having traded at a high of €3.45 and a low of €3.351. Turnover during the week totalled 36,013 shares.

Mapfre Middlesea plc and Malita Investments plc (Malita) shares closed unchanged at €1.221 and €0.87 respectively. In its Interim Directors’ Statement Malita reported that the company’s financial performance for the six months ending June 30, 2015, is expected to be within those projected for the period.

In the company’s Interim Directors’ Statement Grand Harbour Marina plc reported better revenues for the Group during the first quarter of the year, with improvements at both Grand Harbour Marina in Malta and at IC Cesme Marina in Turkey – in which the Group holds a 45 per cent beneficial interest through a joint venture with the IC Cecen Group. In Q1 of 2015, the Group achieved a revenue of €1.14m an increase of 12 per cent over the same period in 2014. The Group registered a loss before tax of €0.15m, compared to a loss before tax of €0.11m last year.

In its Interim Directors’ Statement Plaza Centres plc announced that occupancy during Q1 of 2015, increased by eight per cent compared to the same period in 2014. Revenue and EBIDTA also increased. The Directors anticipate maintaining relatively high occupancy levels throughout the year.

In its Interim Directors’ Statement GlobalCapital p.l.c.announces that during the first quarter ending 31 March 2015 the Group registered significant operational progress when compared to the first quarter of 2014. The Board reported that it approved aggressive transformation strategy aimed at generating revenue growth, reducing operational costs and ensuring long-term financial stability. This strategy has strengthened the business of the life and health insurance subsidiaries, which remain the primary focus of the Group.The Company’s intention to divest of its investment services and advisory operation remains unchanged. This divestment process is subject to regulatory approval.

In the corporate bond market turnover amounted to €2.1m spread across 26 issues of which 18 increased, three closed lower and five closed unchanged. The recently listed 5.75% IHI plc Unsecured € 2025 Bonds registered a 9.3 per cent rally in its first trading days, closing the week at €109.25.

In the sovereign debt market activity was spread over 24 issues of which short dated issues declined while long-term issues recouped. The 3% MGS 2040 (I) r was the best performer and the most liquid issue having appreciated by 1.4 per cent, to close at €112.48 on a weekly turnover of €3m.