International markets rebound as MSE index falls

As the international markets recovered strongly from the losses experienced in the previous week, the Malta Stock Exchange index this week closed at 3,317.114 points, falling by 0.58% on the week, and now 32.82% year to date. Notwithstanding the gains made in major indices this week, which ranged from gains of 5% to 13%, investors in the local market are experiencing lower losses year to date than investors in most major indices.

A total of 246 deals were registered on the stock exchange for a turnover of over €5.1 million. In the equity market, 138 transactions were carried out for a total value of €478,111. In the corporate bond market 51 transactions for a total value of €231,052 were executed. While in the government bond market 43 transactions were executed for a value of over €2.4 million. Fourteen transactions were carried out in the Treasury Bills market for a value of over €1.9 million.

Bank of Valletta plc saw its share price increase by 0.56% to €3.62 as 36,715 shares changed hands across 42 deals. On Monday, the share price increased by 1.11% to €3.64, but fell back to €3.62 on Tuesday.

HSBC Bank Malta plc, on the contrary, saw its share price drop by 1.03% to €2.89 as 60,221 shares changed hands across 41 deals. The share price lost most ground on Friday as 28,152 shares were traded.

On the other hand, the share price of Lombard Bank Malta plc increased by 0.07% to €2.95 as 2,699 shares were negotiated across two deals on Friday.

Meanwhile, the share price of FIMBank plc dropped by 0.43% to $1.394 as 47,849 shares changed hands across nine transactions.

The share price of International Hotel Investments plc dropped by 1.10%% to €0.90. A total of 20,252 shares were negotiated across 11 deals. The share price of GO plc appreciated by 0.05% to €1.90 as 8,536 shares were negotiated across 11 deals.

During this week Middlesea Insurance plc experienced a drop of 5.45% in its share price, which closed at €2.55. This came as the result of two trades for a total volume of 2,000 shares.

The share price of Maltapost plc fell by 6.70% on Tuesday, but the equity was up 1.33% on the week as 22,398 shares changed hands in 10 deals.

Datatrak Holdings plc lost most ground this week as its share price dropped by 35.16% in a single deal of just 1,000 shares. The share price closed at €0.201.

Malta International Airport plc was another negative performer with a drop of 0.44% in its share price, which closed at €2.24. A total of 13,900 shares were negotiated on Wednesday across five transactions.

Meanwhile, the share price of RS2 Software plc remained stable at €0.75 as 30,000 shares were traded on Wednesday across three deals.

On Thursday, a single deal of 249 shares in Grand Harbour Marina plc led to an increase of 2.78% in the share price, which closed at €1.85. This equity was the best performer of the week.

On Wednesday, Crimsonwing plc published its interim results for the six months ended September 30. The group's turnover during the first half of the year increased by 45.5% to €6.3 million but the company's after-tax profits declined from €442,201 to a loss of €58,677. Gross margins have improved at around 60 per cent of revenue.

Administration costs were higher due to higher software licence sales year on year, and the additional costs brought in as a result of the acquisitions. A significant investment in training was made in the first half of the year which was required for new projects contracted in the second half. No trades were executed in the equity since November 5.

On Thursday, 6pm Holdings plc issued an interim directors' statement advising that following the company's half-yearly report in August, where it was suggested that the promised first half year performance may persist for the remainder of the year, the company's order book increased substantially as anticipated, particularly in relation to public sector activities.

However, 6pm plc said it has been affected by current conditions in the UK economy which are leading to the postponement of work. Although in the remaining weeks to the end of this financial year, a few of these UK orders could still come to fruition, if these are also postponed, 6pm would start this work in the first three months of 2009 and move into the next financial year with its strongest order book yet.

However, the company admitted that it has been negatively affected by the rate of exchange between the euro and sterling, as well as escalating logistics costs. The company is therefore taking appropriate measures to limit the impact on its profitability. These include the redistribution of work delivered from the UK and Malta, and the optimisation of resources.

The company board said it is confident that in the current recession, this strategy is essential for client growth and the achievement of economies of scale in delivery, and will allow 6pm to maintain premium sales rates to protect its revenues and margins.

On Friday, Simonds Farsons Cisk plc issued an interim directors' statement that during the first nine months of the current financial year, the group registered increased turnover levels over the corresponding period last year in its brewing, production and sale of branded beers and beverages segment, in its food importation business and the operation of franchised food retailing establishments.

However, the company said the substantial reduction in sales value per litre of carbonated soft drinks continues to have a negative impact on the profitability of this segment. The directors expect the group's results for the current financial year will show a material decline in profitability over the results for the year ended January 2008.

Still, the directors believe that through the measures being undertaken, the company remains well positioned to handle the challenges ahead.

This report which was compiled by Jesmond Mizzi, managing director of Jesmond Mizzi Financial Services Limited (JMFS).The report does not intend to give investment advice and the contents therein should not be construed as such. JMFS is licensed to conduct investment services by the MFSA. 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 JMFS at 67/3, South Street, Valletta, or on Tel: 2122 4410 or e-mail jmizzi@jmfs.net.