By Gabriel Mansueto, Head of Institutional Investors at Jesmond Mizzi Financial Advisors

The Malta Stock Exchange (MSE) Equity Total Return Index closed the year down by 9.7% at 7,404.793 points, in line with other European equity indices. Turnover reached nearly €32m, as 5,222 transactions were executed. Bank of Valletta plc (BOV) shares were the most traded, as activity in banking equity reached €5.9m. This was followed by Malta International Airport plc (MIA) shares, as €3.8m worth of deals were transacted. International Hotel Investments plc (IHI) was the only large cap to close the year in the green, while various other listed equities posted double-digit declines.

In the fixed-income market, the MSE Malta Government Stocks Total Return Index closed lower by 20% at 884.463 points. Raging inflation and a sharp increase in short-term interest rates had a negative impact on sovereign bond prices. Yields increased across the MGS yield curve, with short-term bonds, which were generating negative returns up to some months ago, closing the year yielding positive returns close to 3%. Long-dated sovereign bonds were the hardest hit, as such bonds tend to be the most sensitive to changes in inflation expectations and changes in interest rates. Turnover totaled €108m.

Meanwhile, the MSE Corporate Bonds Total Return Index was less sensitive to the constant increase and record inflation levels. Despite finishing the year in the red, its performance was nowhere close to what was witnessed in credit markets abroad. Year-on-year, the MSE Corporate Bonds Total Return Index declined by 2.1% to close at 1,124.936 points. Over 10,000 transactions worth €100m were executed.

Annual performance of biggest 10 equities by market capitalisation.

In the financial sector, BOV shed 10% to end 2022 at €0.81 after trading at a yearly low of €0.76. Back in May, the bank announced that it had reached a €182.5m settlement agreement with the curators of the bankruptcy of the Deiulemar group. Upon this news, activity in BOV shares surged, and the share price briefly surpassed the €1 level, up from €0.785 a day earlier. During the year, nearly 7m shares changed hands in 1,156 transactions.

HSBC Bank Malta plc (HSBC) shares posted a 23% decline, as the banking group failed to maintain the €0.995 level that it reached early in February and closed at a yearly low of €0.71. The equity was among the most traded equities during the last 12 months, as 448 deals worth €2.1m were executed.

Likewise, APS Bank Malta plc, which was listed on the MSE last June, was among the most liquid equities, with turnover reaching €2.5m. Since the banking equity’s initial public offering, APS
shares declined by 0.8%. All MSE indices closed the year in the red

Meanwhile, the share price of Mapfre Middlesea plc plummeted by 30.4% to end the year at a multi-year low of €1.60. During the year, the equity traded at a yearly high of €2.20, but because of selling pressure the equity slowly headed south to trade at a yearly low of €1.50, before recovering some lost ground.

MIA shares could not find enough support to hold the share price above the 2021 close of €6. Last February, the equity’s price managed to briefly trade at €6.05 but quickly returned to the €6 level and lower, where it spent the rest of the year. MIA shares traded at a yearly low of €5.55 and closed at €5.80, hence down by 3.3% year-on-year.

IHI shares gained 9% to close the year at €0.675. Optimism around the equity gathered steam last April following a company announcement that the United Development Company (UDC) will inject fresh capital in IHI. UDC is a listed company whose main shareholder is the Pension Fund of Qatar. The equity touched a yearly high of €0.805. During 2022, 218 deals worth €1.1m were executed.

In the communication services sector, GO plc declined by 15%, as the equity’s price closed at €2.86. During the year, GO plc shares traded between a yearly high of €3.34 and a multi-year low of €2.70, reached in early December. A total of 353 deals worth €2.8m were executed.

In the information technology sector, RS2 Software plc Ordinary lost 23%. The equity had a volatile year, as the share price oscillated between a yearly high of €1.74 and a low of €0.95 late in December. In 2022, RS2 allotted one bonus share for every eight held to eligible shareholders. The equity managed to recover some of the lost ground in the closing trading sessions, as it closed the year at €1.19.

Simonds Farsons Cisk plc (SFC) also registered a loss of 14.8%. During the year, SFC allotted one bonus share for every five shares held to eligible shareholders. Turnover reached €2.3m over 239 transactions of 300,081 shares.

Within the same sector, PG plc shares lost 13.3%, or €0.32, as the equity closed 2022 at €2.08. During the year, the share price of PG plc traded between a yearly high of €2.40 and a low of €1.71.

This article is issued by Jesmond Mizzi Financial Advisors Limited (JMFA) and was prepared by Gabriel Mansueto – Head of Institutional Client at JMFA. This article 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, under the Investment Services Act. Investors should remember that past performance is no guide to future performance and that the value of investments may go down as well as up. For further information contact Jesmond Mizzi Financial Advisors Limited of 67, Level 3, South Street, Valletta, on Tel: 2122 4410, or email [email protected]