MSE Trading Report for Week ending 20 November 2020

MSE Equity Total Return Index:

Chart of the Week: HSBC Bank Malta plc 

Highlights:
  • The  MSE Equity Total Return Index reached 7,472.036 points, translating into a marginal 0.02% gain, to close higher for the fourth consecutive week. A total of 17 equities were active, five of which headed north while another eight closed in the opposite direction. A total weekly turnover of €0.5 million was generated across 113 transactions.
  • The best performer was Malta International Airport plc, as it reached a 16-week-high price of €5.50 – equivalent to a positive 4.8% change in price. This was the result of 23,616 shares spread over 20 deals, worth €124,530.
  • In the banking sector, HSBC Bank Malta plc (HSBC) closed 4% higher at €0.78, as 67,223 shares changed hands across 15 transactions.
    • On Tuesday, the bank issued its interim directors’ statement. For the nine-month period to September 30, 2020 the bank’s profit before tax was lower than the same period in 2019.
    • Whilst the third quarter results were better than those achieved in each of the prior two quarters, performance continues to be impacted by Covid-19.
    • Revenue was negatively impacted by the pandemic, resulting in losses incurred by the HSBC Life Assurance subsidiary, mainly as a result of adverse market movements.
    • Underlying net interest income was relatively stable, compared to the same period last year.
    • Expected credit losses were significantly higher than those reported in the same period last year, as the bank assessed the likely impact of Covid-19 on their customers, reflecting the worsening forward economic outlook due to the pandemic.
    • In line with the interim results, operating expenses were lower than the same period in 2019. This reduction reflects the implementation of the bank’s strategy announced in 2019 and a continued focus on cost management.
    • Compared to December 2019, loans and advances to customers increased, driven by growth in mortgages, with commercial banking balances remaining stable at December 2019 levels.
    • Customer deposits have increased since December 2019. The bank’s liquidity position remained exceptionally strong and regulatory capital ratios continued to exceed regulatory capital requirements.
  • Its peer, Bank of Valletta plc traded at a weekly high of €0.95 but declined to €0.94 yesterday. The equity closed 1.1% higher, as a total of 21 deals involving 50,777 shares were executed.
  • Telecommunications company, GO plc registered the highest liquidity, as it registered a total turnover of €146,628. A total of 18 deals involving 50,389 shares resulted into a 2.7% or €0.08 drop to €2.92. During the week the equity traded between a weekly low of €2.80 and a high of €3.
  • On Thursday, RS2 Software plc announced that the documentation relative to the extraordinary general meeting which shall be held on December 15, 2020 is available for inspection on the company’s website. Seven deals involving 9,947 shares resulted into a negative 3.9% movement in price, to close at €2.00 after having traded at a weekly high of €2.08.
  • Lombard Bank Malta plc traded twice over 5,167 shares, dragging the price by 3.1% to €1.88.
    • On Thursday, the bank issued its interim directors’ statement and an update about the current situation. The pandemic negatively impacted some lines of business also during the third quarter of 2020.
    • Profit before tax was lower than that registered for the same period in the previous year, and it is expected that the financial results for the year will be subdued compared to the original targets.
    • Pressure on interest rates, including negative interest on prime quality assets, is expected to continue, giving rise to a smaller interest margin.
    • Commission income, too, was negatively impacted by reduced volumes as business sentiment and activity continued to be affected by the economic slowdown.
    • Operating costs remained under control, the bank incurred additional expenditure in ensuring that its customers and staff remained safe and always fully protected during this challenging time.
    • The overall financial position remains strong and there are no indications of significant deterioration in the bank’s assets.
    • Total assets were slightly higher when compared to the previous year, while both the capital and liquidity ratios remained well in excess of the regulatory requirements.
    • The bank’s loans and advances to customers portfolio, includes facilities in respect of medium-term projects which should not be unduly impacted by the short-term economic environment.
    • The majority of the lending exposures are well secured by high-quality collateral. It is anticipated that worsening economic forecasts factored into the calculation of expected credit losses may well give rise to an increase in these allowances for 2020.
    • The loan to deposit ratio  hovered around a prudent 65%, with customer deposits tending to grow faster than loans and advances.
    • MaltaPost plc, the bank’s main subsidiary, continued its operations uninterruptedly, with only minor disruptions mainly in deference to health and safety precautions.
    • After significant logistical difficulties during the second quarter of 2020 due to unavailability of international transport facilities, delivery of postal items picked up in earnest in the third quarter so that activity, although not at full capacity, then reached an acceptable level.
    • This week no trading activity took place in the shares of the postal operator.
    • Yesterday, the company announced that the board of directors will be meeting on Monday, December 21, 2020 to consider and approve the financial statements or the year ended September 30, 2020.
  • On Thursday, PG plc announced that the board shall be meeting on November 26, 2020 to consider, and if deemed fit, approve the distribution of an interim dividend for the financial year ending April 30, 2021. The equity was up by 0.5% to €1.89, as 27,500 shares were spread across eight transactions.
  • Last Monday, Plaza Centres plc reported that, as part of the share buy-back, it has received seven different offers from shareholders, for an aggregate of 3,529,797 shares, who expressed an interest in selling back their shares in the company.
    • The best offer received by the company was for a total of one million shares at the price of €0.92c.
    • In line with the terms announced, these shares were traded on the Malta Stock Exchange for value on Thursday 19th November.
    • The equity traded once but remained flat at €0.925.
  • On Thursday, Loqus Holdings plc announced that the forthcoming annual general meeting shall be held on January 14, 2021. The equity was not active during the week.
  • The MSE MGS Total Return Index managed to recover its previous week’s decline, as it reached 1,138.91 points, equivalent to a 0.9% increase. Out of 17 active issues, eight registered gains while another seven declined. The top performer was the 5.25% MGS 2030 (I) as it closed 2.4% higher at €149.94. Conversely, the 3% MGS 2040 (I) closed 0.7% lower at €140.00.
  • The MSE Corporate Bonds Total Return Index recouped some lost ground, as it closed 0.13% higher at 1,080.33 points. A total of 47 issues were active, 20 of which advanced while another 14 closed in the red. On Thursday, the 3.25% APS Bank plc Unsecured Subordinated € Bonds 2025-2030 was granted admission to the official list of the MSE. The 3.8% Hili Finance plc Unsecured Bonds 2029 headed the list of gainers, as it closed 2.1% higher at €98.99. On the other hand, the 6% Medserv plc Secured & Guaranteed € Notes 2020-2023 S1 T1 3 lost 2.5%, ending the week at €97.00.
  • In the Prospects MTF market, seven issues were active. The 5% Smartcare Finance plc Secured € 2029 was the most liquid, as it generated a total turnover of €55,499.

 

Upcoming Events 
Best Performers:
1. MIA+4.76%
26 NOV 2020MT: Bank of Valletta plc – Annual General Meeting2. HSBC+4.00%
27 NOV 2020MT: HSBC Bank Malta plc – Annual General Meeting3. MPC+2.08%
30 NOV 2020MT: FIMBank plc – Annual General Meeting
02 DEC 2020MT: Lombard Bank Malta plc – Annual General MeetingWorst Performers:
15 DEC 2020MT: RS2 Software plc – Extraordinary General Meeting1. SFC-3.85%
2. LOM-3.09%
3. BMIT-2.89%

 

 

 

Price (€): 20.11.2020Price (€): 13.11.2020Weekly Change (%)2020 Performance (%)
MSE Equity Total Return Index7,472.0367,470.6160.02-22.29
BMIT Technologies plc0.4700.484-2.89-9.62
Bank of Valletta plc0.9400.9301.08-11.32
FIMBank plc (USD)0.3000.3000.00-50.00
Grand Harbour Marina plc0.7000.7000.0027.27
GO plc2.9203.000-2.67-31.46
Harvest Technology plc1.4601.480-1.35 -2.67
HSBC Bank Malta plc0.7800.7504.00-40.00
International Hotel Investments plc0.5700.575-0.87-31.33
Lombard Bank plc1.8801.940-3.09-17.54
Loqus Holdings plc0.0650.0650.000.78
LifeStar Holding plc0.5000.5000.0078.57
MIDI plc0.3220.3220.00-40.37
Medserv plc0.4800.4800.00-56.36
Malta International Airport plc5.5005.2504.76-20.29
Malita Investments plc0.9000.9000.000.00
Mapfre Middlesea plc1.9401.970-1.52-10.19
Malta Properties Company plc0.4900.4802.08-22.22
Main Street Complex plc0.4500.4500.00-25.00
MaltaPost plc1.0501.0500.00-19.85
PG plc1.8901.8800.532.72
Plaza Centres plc0.9250.9250.00-8.42
RS2 Software plc2.0002.080-3.85-6.54
Simonds Farsons Cisk plc8.2008.300-1.20-28.70
Santumas Shareholdings plc1.4901.4900.005.67
Tigné Mall plc0.7500.7500.00-16.67
Trident Estates plc1.5101.5100.00-2.58

* Trading commenced on January 7, 2020

This article, which was compiled by Jesmond Mizzi Financial Advisors Limited, does not intend to give investment advice and the contents therein should not be construed as such. The Company is licensed to conduct investment services by the MFSA and is a Member of the Malta Stock Exchange and a member of the Atlas Group. The directors or related parties, including the company, and their clients are likely to have an interest in securities mentioned in this article. For further information contact Jesmond Mizzi Financial Advisors Limited at 67, Level 3, South Street, Valletta, or on Tel: 21224410, or email [email protected]