Demand for Corporate Bonds increases, as activity in Equities declines

MSE Trading Report for week ending August 24, 2018

The MSE Equity Total Return Index partially erased the previous week's 0.487% loss, having recouped by 0.079%, to close at 8,570.088 points. Activity was spread across 20 equities, of which gainers and losers tallied at five. Turnover fell from the previous week's €2 million, to €1.4 million.

FIMBank plc shares registered the best performance, having advanced by $0.045 or 8.7% – erasing the previous week's 5.5% loss. The equity managed to close at $0.56 as a result of last-minute deals on Friday.

Bank of Valletta plc (BOV) shares recorded a decline for six consecutive weeks. The banking equity fell by 1.3%, after having witnessed the highest turnover of 386,201 shares, spread across 88 transactions and closing the week at €1.50, also a result of a last-minute deal during the week’s final session.

Lombard Bank Malta plc (Lombard) shares appreciated by €0.10, as 29,839 shares changed ownership on 12 transactions, closing at a five-month high of €2.40.

The group registered a profit before tax of €6.1 million for the first six months of 2018, translating to a significant 29.7% increase. This was in line with a 32% increase in operating income, which reached €35.4 million during the period, as activity remained strong in all significant business lines. The group’s performance was positively impacted by higher volumes of commercial credit activity during the past year.

Loans and advances to customers were up by 10.7% to €474.7 million, backed by a 2.5% increase in customer deposits to €751.8 million. This resulted in the Bank Advances to Deposits Liquidity Ratio to rise from the 58.2% recorded at the end of year 2017, to a still healthy 62.7%. The Capital ratio was registered at a solid 13.6%, well above the 8% regulatory minimum requirement. All of this resulted in an improved earnings per share figure of €0.084, compared to the €0.06 registered during the same period last year.

HSBC Bank Malta plc shares closed unchanged at €1.80, despite having reached a weekly low of €1.78. The banking equity was negotiated across 14 trades of 28,024 shares.

The investments and insurance services provider Mapfre Middlesea plc registered no change in its €1.89 share price, as three deals of 5,365 shares were negotiated.

Malta International Airport plc shares decreased by 0.9% as 12,036 shares changed hands on 10 deals, to close €0.05 lower at €5.60. Monday was the cut-off date for the local airport operator's net interim dividend of €0.03 per share, due for distribution on September 14, 2018.

GO plcshares added to the previous week's 0.6% increase, having advanced by €0.04 or 1.2%. The telecommunications services provider's shares were executed across 13 transactions of 46,848 shares, and closed at €3.44.

International Hotel Investments plc shares partially reversed the previous week's 6.7% gain, having slipped by 3.9%. The hoteliers' equity was negotiated across two trades of 2,057 shares, closing at €0.615. The company's board will review the half-yearly financial report for the first six months of 2018 on Friday, August 31.

On Thursday, Santumas Shareholding plc’s board approved the audited financial statements for the year ended April 30, 2018.  These statements will be submitted for the approval of the shareholders at the forthcoming Annual General Meeting which is scheduled for October 23, 2018. The results show a loss before tax of €82,597, compared to a profit of €1.8 million for 2017. This was mainly the result of an 82.9% drop in investment income, coupled with a decrease in fair values of financial assets of €519,230, as opposed to an increase in value of €303,424 in 2017. Earnings per share stand at a loss of €0.026 per share, down from the previous year’s €0.239. The equity was not active last week.

RS2 Software plc shares closed unchanged at €1.19 for the third consecutive week, despite having traded at a weekly low of €1.15. The I.T. equity was active on seven deals of 10,155 shares. The Board of RS2 is scheduled to meet on Tuesday, August 28 to consider, and if thought fit, to approve the interim financial statements for the six-month period ended June 30, 2018.

In the same sector, Loqus Holdings plc shares fell by 2.7%, as one transaction of 10,000 shares was concluded, closing the week at €0.092.

Simonds Farsons Cisk plc shares managed to recoup from their weekly low of €7.40, having closed at €7.50. The food and beverage supplier's shares witnessed four trades of 3,070 shares. SFC's spin-off Trident Estates plc shares closed unchanged at €1.33, as nine deals of 10,300 shares were executed. 

Plaza Centres plc reversed the previous week's 2% loss, having gained 2%. The shopping mall owner's shares witnessed three transactions of 12,625 shares, and closed at €1.02.

In the same sector, Main Street Complex plc shares traded flat at €0.665 on one trade of 3,000 shares. The company recorded a profit before tax of €196,256 for the first half of 2018, which is 10.5% lower than the corresponding period last year. Revenues were marginally down at €353,860 while operating expenses increased from €20,391 to €31,241 as a result of lower recoveries of Common Area and Building Maintenance costs, higher management fees, additional depreciation on a new lift installation, and governance costs. Finance costs on the other hand decreased by 25.3% following the full repayment of banking facilities following the company’s listing, as envisaged.

The board of directors has resolved to distribute a net interim dividend of €0.00628 per share on September 14, 2018, to all registered shareholders as at September 7, 2018.

Shareholders on Tigne Mall plc’s register as at August 17, 2018 will receive a net dividend payment of €0.0128 per nominal €0.50 share on Friday August 31. The equity was not active last week.

Medserv plc shares swayed between an 8-week low of €1 and a weekly high of €1.09 – at which it closed. The oil and gas logistics services provider's shares declined by 1.8% across 17 transactions of 61,320 shares. Tomorrow, the board is scheduled to meet to consider, and if thought fit, approve the unaudited half-yearly report of the Company for the six months ended June 30, 2018.

Malta Properties Company plc shares traded unchanged at €0.51 on six trades of 88,245 shares. Meanwhile, Malita Investments plc (Malita) shares closed unchanged at €0.87 as 11 deals of 119,600 shares were concluded.  Tuesday, August 21 was the cut-off date for Malita's interim net dividend of €0.00858 per share. The interim dividend will be paid on September 7, 2018.

MIDI plc shares closed in positive territory for the third consecutive week, having advanced by 2.9%. The property management equity was executed across eight transactions of 123,099 shares, and closed at a record high of €0.535. The Board is scheduled to meet on Thursday, August 30 to consider and approve the interim unaudited financial statements for the six month period ended June 30, 2018.

MaltaPost plc shares closed unchanged at €1.65 for the second consecutive week, having witnessed five trades of 22,800 shares.

PG plc shares traded flat at €1.37 on two deals of 5,750 shares. The retail and supermarkets owner announced that, if approved at the board's meeting, an interim dividend will be distributed on September 5, 2018 to all registered shareholders as at August 24. The amount of the dividend, if any, will be communicated to the market at a later stage, after the board meeting is held on Tuesday, August 28.

In the corporate bond market, 39 issues were active of which 18 increased and nine fell. Turnover more than doubled, from €1.4 million, to €3.6 million. The 4% Exalco Finance plc Secured 2028 headed the list of gainers, having advanced by 4.75%, to close at €104.75, while the 5% Mediterranean Investments Holding plc Unsecured € 2022 registered the worst performance, having declined by 1.7%, closing at €102.20.

In the sovereign debt market turnover increased to €1.8 million from €1.3 million. Activity was spread across 21 issues, of which four appreciated and 15 declined. The 2.1% MGS 2039 (I) was the most liquid issue, having witnessed a turnover of €350,980, closing at €101.05.