NEWS | Wednesday, 09 January 2008

Up and down on the MSE

Business Today looks at the fortunes of the listed companies throughout 2007

Whenever one invests, he is forewarned that the price of the investment is bound to go up, as well as go down. Whoever, had an investment in all equities listed on the Malta Stock Exchange relative to the market capitalisation value, lost out marginally at around 1% over 2007.
The best performer, last year in share price value increase, was Simonds Farsons Cisk. The potential of this manufacturer of beverages with investments in eateries and importation of spirits has still yet to be maximised. The next best performer was Medserv plc, whose share price registered at the end of 2007, an increase of 29%, compared to the value with which it started off the year. This firm is the exclusive owner of a wharf at the South of Malta, held on a long term lease.
All other equities, that registered an increase in share price during 2007, only gained in single digit growth. GlobalCapital, a Group of Companies earning from the provision of financial services and property investment registered an increase of 9% in its share price, closely followed by another company that earns income mainly from property ownership, San Tumas. This closed investment scheme earned 8%.
It was next the turn of two banks to classify with a minor positive increase in share price. Lombard Bank earned 7% with the closing share on the last trading day being the best performing price in 2007. HSBC, the global bank succeeded in increasing its market capitalisation by 5%. Despite consistently coming out with the best financial results and a very generous dividend payout, the share price only registered a minimal increase.
Another positive performer was International Hotels Investments, which was formerly a Maltese family owned hotel operations with properties in Europe and North Africa and during the year welcomed on board additional investors from Saudi and Dubai. IHI registered a 4% increase in share price. This company was the only one whose share price was quoted in Euro long before Malta joined the Euro zone. Another international bank, with diverse operations in emerging markets, Fimbank registered just less than 1% increase in price. The share price is denominated in dollars; this may have affected the comparative pricing.
Malta International Airport, the Austrian controlled international airport operator, registered a minor increase in price of 1%. The fate of the value of the share price of this firm is being affected by the tourist arrival figures, issued by the Tourism Authority.
All other equities quoted on the local stock exchange lost in value. Plaza, the owner of a shopping mall despite being generous in its dividends yield and with 100% occupancy lost 4% of its share value. BOV the Euro conversion partner bank, with a 25% shareholding by the Government of Malta lost out 5% in value, despite publishing strong full year results in the last quarter of 2007. BOV’s reputation of having a miserly dividend policy is having an effect on its share price. Go, the rebranded name for the leading telecommunications operator, lost out 9% of its value to continue with a negative streak in share price registered from when the Dubai based majority controlled owners took over.
A company that had a battering in its share price was the long established Middlesea Insurance. The fact that it had just celebrated its 25th year of operation was not enough to lift the share price. Investors saw through the wide-ranging loss in value of the investment portfolio that generates a backing to the insurance policies underwritten by the company.
The worst performing equity was Datatrak. The latter’s share price performance, has no impact on the Malta Stock Exchange index, but is the reflection of how risky any investment is as the share price normally mirrors performance as against expectations.
Local investors in 2007 had two other additions to their choice of investments in Grand Harbour Marina and 6pm. This year, another equity called Crimsonwing has joined the list of traded equities, and relatively soon, Maltapost will be another addition. The sentiment of Maltese investors in 2007 reflected more a corrective mood, than an adventurous one, throughout the year.