MSE | Wednesday, 16 April 2008

The MSE index back in negative terrain

GlobalCapital Financial Management Ltd - Malta Stock Exchange Review

Yesterday, the second session of the week was dominated by weak volumes. The market moved in negative territory, to close at 4621 points, down 0.39% or 18.28 points. Frontline players Bank of Valletta p.l.c. continued to zoom downwards. Meanwhile, International Hotel Investments p.l.c. shares edged forward, whereas HSBC Bank Malta p.l.c. shares finished unchanged.
Large-cap Bank of Valletta p.l.c. saw Eur10c0 (MTL0.043) of its value being shaved off to close at Eur5.35 (MTL2.297) across 20,335 shares. These shares were transacted across twenty-four trades and carried a market value of Eur109,138.45 (MTL46,853.14).
GO p.l.c. and Middlesea Insurance p.l.c. retreated Eur1c5 (MTL0.006) and Eur1c4 (Eur0.006) at Eur3.00 (MTL1.288) and Eur3.50 (MTL1.503) respectively. Their combined volumes amounted to 1,100 shares.
Yesterday, GO p.l.c., announced that on the 14th April 2008, Forthnet entered into a share purchase agreement (the “Transaction”), which is subject to certain terms and conditions and to regulatory approvals in Greece, for the purchase of the entire issued share capital in each of (a) NetMed NV, a public company incorporated in The Netherlands and (b) Intervision (Services) BV, a company incorporated under the laws of the Netherlands. In connection with the financing of the Transaction, Forthnet is proposing to raise capital inter alia by way of an issue of rights to its existing shareholders (the “Rights Issue”). Forthnet will also grant a right to those of its shareholders who exercised their rights to take up shares in the Rights Issue in full to subscribe for an unlimited number of additional new shares which will have not been taken up by its other shareholders (the “Oversubscription Right”). Furthermore, GO p.l.c. announced that together with Forgendo and EITML, it has agreed to support Forgendo’s commitment to take up in full Forgendo’s entitlement to the Rights Issue and to contemporaneously with the exercise of such entitlement exercise the Oversubscription Right in respect of all the shares remaining unsubscribed at the end of the Rights Issue subscription period. GO also announced that EITML and GO have agreed to each make available to Forgendo the necessary funds to enable Forgendo to take up the Rights Issue and the Oversubscription Right, provided that GO shall only be liable to fund up to a maximum amount of €100,000,000 (One Hundred million Euros). GO’s commitment is inter alia subject to the approval of the Rights Issue by (i) the general meeting of Forthnet and (ii) any Greek administrative or regulatory clearance as may be required.
On Friday11th April, GO p.l.c. announced that during the Tenth Annual General Meeting, all the resolutions on the agenda were approved. Furthermore in accordance with Clause 7 of the Memorandum of Association of the Company, the following were appointed/elected directors of GO p.l.c. until the next Annual General Meeting. These are Mr. Saviour Portelli (Chairman), Mr. John Ellul Vincenti, Mr. James Kinsella, Dr. Ahmed Mahjoub, Mr. Deepak Srinivas Padmanabhan, Mr. Osman Sultan, Mr. Paul Testaferrata Moroni Viani and Mr. Michael Warrington.
On a positive note, the shares of International Hotel Investments p.l.c. finished marginally up by Eur0c1 to settle at the Eur1.10 (MTL0.472) level across 18,000 shares. At the end of trading, best bids for 2,000 shares stood at Eur1.06 (MTL0.455), whereas the best offers for 10,000 shares stood at Eur1.099 (MTL0.472).
At a meeting held on 8th April 2008, the Board of Directors of International Hotel Investments p.l.c. approved the financial statements of the Company for the financial year ended 31st December 2007. The Group’s performance for 2007 was positively affected by a number of factors, these being, the performance of the existing hotel properties continued to improve both in terms of turnover and profitability as they progressed further towards achieving operational maturity, the Group’s results also include the positive effect of a full year of CHI Ltd’s (CHI) performance as opposed to a two months’ performance included in 2006 and the contribution made by the newly-acquired Corinthia Bab Africa Hotel and adjoining Commercial Centre in Tripoli and the Corinthia Hotel Prague, even though the 2007 results include only the performance of the last seven months of the year since acquisition. Revenues increased to €104.1 million from €60.4 million in 2006 while the Operating Profit before the Revaluation to fair value of investment properties net of impairment losses was €16.1 million compared to a profit of €3.1 million in 2006. In line with the Group’s policy of revaluing the carrying amounts of its properties to fair value, two uplifts in the value of investment properties totalling €7.7 million resulting from independent experts’ valuations were recognised in the Income Statement. An uplift in value of €5.7 million was recognised in the case of one of the plots of land adjacent to the Corinthia Nevskij Palace Hotel in Saint Petersburg and a further €2 million in relation to the Commercial Centre in Tripoli. Further uplifts in value of the hotel properties in St. Petersburg, Tripoli and Prague totalling €27.7 million, net of deferred tax, were taken directly to the Revaluation Reserve in the Equity section of the Consolidated Balance Sheet. The net finance expense remained on the same level of 2006 as a result of a combination of compensating factors. These relate to the higher financing costs of the acquired hotel properties which were mitigated by interest income from the deposit of the funds from the share capital subscribed by Istithmar Hotels FZE. The above factors result in a profit for the year before tax of €14 million as compared to a loss of €10.7 million in 2006 while the profit after tax was €10 million compared to a loss of €10.5 million in 2006. During the Board Meeting held on 8th April 2008, the Directors recommended a Bonus Share Issue of 3% for all the Company’s shareholders appearing on the Register of Members of the Company as at close of business on 18th April, 2008 to be distributed from its reserves. This Bonus Share Issue is subject to approval by the Company’s Annual General Meeting which will be held on 15th May 2008.
It was a particularly good day for Plaza Centre p.l.c. shares as they managed to advance Eur2c5 (MTL0.011) at Eur1.725 (MTL0.741). A total turnover of 2,900 shares was swapped across two deals. The price shifted in a very tight range of Eur1.70 (MTL0.73) to Eur1.725 (MTL0.741).
Trading in MaltaPost p.l.c. shares was restricted to six deals. Its share price finished up Eur0c5 (MTL0.002) at Eur0.79 (MTL0.339) across 8,600 shares.
HSBC Bank Malta p.l.c., Malta International Airport p.l.c. and 6pm Holdings p.l.c. preferred to stay on the sidelines and finished unchanged from their previous session close at Eur4.39 (Eur1.885), Eur3.33 (MTL1.43) and GBp0.77 respectively.
Following a company announcement issued by 6pm Holdings p.l.c. on Friday 11th April; the Board of Directors met and approved the Audited Accounts for the period ended 31st December 2007. The Board of Directors further resolved not to recommend at the forthcoming Annual General Meeting, to be held on the 23rd May 2008, the shareholders to approve the payment of a final net dividend for period ended 31st December 2007. During the 5 month period ended 31st December 2007, the group registered a profit before taxation of GBP 275,881. This represents a return of 15 % of the shareholders’ funds. Profits attributable to shareholders were GBP 314,265 and earnings per share for the 5 month period amounted to GBP 0.068. The gross profit for the period amounted to GBP 1,023,459, equivalent to 35 % of total revenues. Net operating costs amounted to GBP 711,191 which mainly represents employee costs amounting to GBP 455,543. A tax credit for the period amounted to GBP 38,384 which arose given that the group is eligible to income tax credits on its investments on certain of its tangible and intangible assets. The board of directors declared the payment of a net interim dividend in 2008 of GBP 100,988 on 2007 group results, representing a net dividend of 45% of distributable profits equivalent to GBP0.013 per share. This dividend will be paid to all shareholders on the company’s share register at close of trading on the Malta Stock Exchange on 25th April 2008.
In the fixed interest market, a total of Eur4,498,495.18 (MTL1,931,203.98) (16 Deals) were transacted in Government Bonds, whereas a total of Eur11,222.69 (MTL4,817.90) (6 Deals) were transacted in Corporate Bonds.