Major Banks drag index lower

MSE Trading Report for week ending August 4, 2017

The MSE Equity Index continued with last week’s negative performance having declined by 1.272 per cent at 4,652.407 points. The major banks, Bankof Valletta plc and HSBC Bank Malta plc, exerted downward pressure on the index, while GO plc and Malta International Airport plc tempered the tone as both equities headed north. A total of 15 equities were active during the session of which seven lost ground, five were in the black, while three closed flat. Total turnover in the equity market decreased from €2.44m to €2.16m.

Last Monday, HSBC Bank Malta plc announced its interim results for the six months ended June 30, 2017. The Bank registered a profit before tax of €25.9 million, compared to a profit of €41.3 million registered in the comparable period of 2016. On an adjusted basis, after excluding the €10.8 million investment gain on the sale of Visa Europe last year, profit was down by 15 per cent. Net interest income for the period under review amounted to €60.3 million – down by 5.6 per cent from 2016. Earnings per share (EPS) decreased from €7c5 to €4c7, and a net interim dividend of 3 cents net of tax per share will be paid on September 11 to shareholders on the bank’s register as at August 10, 2017 – in-line with the current dividend pay-out ratio of 65 per cent.

The year-on-year negative performance, was reflected during the week, as the equity lost three per cent of its value to close at €2.00 – hitting a seven-month low. A total of 148,863 shares were exchanged across 28 deals.

Likewise, Bank of Valletta plc shares registered the largest decline among its peers as the equity closed 3.4 per cent in the red to close the session at €2.078 – hitting an eight-month low. Total turnover in the equity amounted to €432,008 spread over 72 transactions.

On a positive note, Malta International Airport plc shares reached a five-month high at €4.225. The equity registered an increase of 0.6 per cent during the week as 16 trades managed to generate a total turnover of €138,843

On Friday, the board of directors of GO plc approved the group interim unaudited financial statements for the six month period ended June 30, 2017.

The GO Group reports improved results for the six months period ended 30 June 2017 with growth in revenue and profitability. During the period under review revenues increased by €4.3 million to €81.0 million. This led to an improvement of €2.7 million in earnings before interest, tax, depreciation and amortisation (EBITDA), which amounted to €32.6 million and an operating profit of €14.6 million. No dividend was declared.

The equity managed to notch the highest turnover during the week as the equity’s 35 trades managed to generate a turnover of €487,409 – the absolute majority of which was generated prior to the announcement. The equity closed the session 0.3 per cent higher at €3.60 – reaching a 2 week high.

On the same note, PG plc share reached a fresh all-time high as the equity closed 4.4 per cent higher at €1.399. A total of five trades saw 6,419 shares change hands.

Last Friday, the company announced that the board of directors shall be meeting on August 10, 2017 to consider and approve the audited Financial Results for the year ended April 30, 2017.

On the contrary, RS2 Software plc shares lost ground by three per cent to close the week at €1.79. A total turnover of just above €230,000 was generated among 26 deals.

Last Tuesday, Malta Properties Company plc announced that its board of directors is scheduled to meet on Monday August 7 to discuss the Group’s Interim Unaudited Financial Statements for the six-month period ended June 2017. The equity was active 12 times during the week generating a total turnover of €37,798, to close one per cent higher at €0.515.

In the same sector, Malita Investments plc and MIDI plc shares both headed south. Malita Investments plc shares closed 3.3 per cent lower at €0.74 – as two trades saw 50,000 shares exchanged. Meanwhile MIDI plc shares followed suit as the equity lost 3.1 per cent of its value to close the week at €0.31 – as five trades generated a turnover of €8,703.

Meanwhile, a single trade of 3,800 shares was registered in Tigne Mall plc, leaving the price unaffected at €0.97.

Three trades on Friday amounting to 3,898 shares for Maltapost plc saw the share price decline by one per cent to close the week at €2.00.

On the same note, Global Capital plc shares dipped by 11.5 per cent to close the week at €0.301. A staggering 1.51m shares were exchanged over eight transactions as the founder shareholder sold all his shares. Meanwhile, a single trade over a slim volume in Grand Harbour Marina plc share managed to push the equity up by nine per cent to close at €0.894.

Elsewhere, International Hotel Investments plc and Mapfre Middlesea plc failed to veer despite being active, closing at €0.60 and €1.90 respectively.

Last Monday, Medserv plc announced that the board of directors is scheduled to meet on August 23, 2017 to consider, and if thought fit, approve the unaudited half-yearly report of the Company for the six months ended June 30, 2017. The equity was inactive during the week.

In the sovereign debt front, a total of 25 issues were active, as 20 gained value, four closed the week in negative territory, while one closed flat.  Sovereign holdings with a maturity date over seven years registered gains ranging from 0.1 to 2.2 per cent. The 3.3% MGS 2024 (I) registered the largest advancement as the price rose by 2.2 per cent to close at €120.

 Last Tuesday, the Minister of Finance – Prof Edward Scicluna – announced that the ‘62+ Government Savings Bonds’ will be launched on September 4. The bonds are there to help individuals who are older than 62 years (born in 1955). The bond will have a maturity date of five years and carry a 3% coupon, with interest being paid semi-annually. Each investor can apply for a minimum of €500 up to a maximum of €10,000. More information will be announced in the near future.

In the corporate debt front, a total of 30 issues were active of which eight headed lower, 13 closed higher, while nine remained flat.

Following regulatory approval, on Monday, Simonds Farsons Cisk plc announced that it will be issuing €20m 3.5% Simonds Farsons Cisk plc Unsecured Bonds 2027 while redeeming the €15m 6% Simonds Farsons Cisk plc Bonds 2017-2020. Preference will be given to the existing SFC bond holders.