The Malta Stock Exchange (MSE) index last week eroded the previous two weeks’ gains, as selling pressure on HSBC Bank Malta plc and Fimbank plc shares reigned after they announced their interim results. Meanwhile, gains in Middlesea Insurance plc and RS2 Software plc (RS2) shares prevented the index from plummeting even lower. The index experienced its worst weekly drop in 19 weeks, as 1.91 per cent was shaved off the index, to close at 3,331.346 points – a three-week low.
Trading volume was spread across 20 issues, of which six advanced, while losers and non-movers tallied at seven. Turnover totalled €1.03 million – a 12 per cent decline over the previous week.
Last week, investors shifted their focus to HSBC’s much-awaited interim results for the first six months of the year, which were released on Monday. The group made a pre-tax profit of €40 million – €13 million less than the same period last year. The drop in first-half profits was due to reduced interest earnings and lower non-recurring gains. The board declared an interim gross dividend of €0.045 per share (€0.029 net of tax) to be paid on September 4 to registered shareholders as at Thursday.
Trading in HSBC shares accounted for 30 per cent of total turnover, the highest for single equity last week. HSBC’s share price tumbled by 6.9 per cent to a fresh five-year low price of €1.90, after trading at a high of €2.05.
Similarly, Fimbank plc shares dipped by 9.1 per cent, as a single deal of 10,500 shares was struck at $0.68 – a 53-month low. This followed the bank’s interim results published last Wednesday. During the year’s first six months the group registered a net profit of $1.45 million, compared to a $6.98 million loss in 2013. Net interest income for the period amounted to $14.55 million, a 97 per cent rise from 2013.
The fair-value gains on previously held investments and the decline in losses from trading assets and financial instruments contributed to the bank’s improved results, whereas impairment losses stymied the positive results – reaching $10.2 million from $1.8 million in 2013. Earnings per share rose to $0.0159. The board of directors is not recommending the payment of an interim dividend.
Lombard Bank plc shares were also driven into negative territory, with two deals of 11,250 shares pulling the equity’s price down by 5.9 per cent to €1.60, partially reversing last week’s 13.3 per cent rise. The bank is due to release its interim results later this month.
Bank of Valletta plc (BOV) shares closed the week flat after the week’s second highest volume of trading, worth €234,000. Most of the equity’s gains were reversed by Thursday’s session, with BOV shares closing the week at €2.101.
Middlesea Insurance plc shares soared by 5.1 per cent to a two-month high of €0.92 after 10 deals of 22,860 shares.
Global Capital plc shares rallied by 21.4 per cent after six weeks of inactivity on a volume of 33,735 shares. The equity last traded at €0.80 in July 2012.
Go plc announced that its board of directors is to meet on Wednesday to approve the group’s interim results for the first six months of the year. Go shares maintained their six-year high, as 10 deals of 9,840 shares left the equity’s price intact at €2.40.
Santumas Shareholdings plc announced that its board of directors will meet on Tuesday to consider and approve the company’s financial statements for the year ending April 30, 2014. Three deals of a mere 268 shares were negotiated, but left its price unchanged at €1.99.
Last week, Malta International Airport published its traffic results for July, showing a record of 511,000 passengers, or an 8.5 per cent jump over the same month last year. This was mainly due to the growth from the UK, Italy, France and Germany. Despite this, MIA shares retreated from their all-time high of €2.35, closing the week 1.7 per cent down.
RS2 and 6PM Holdings plc shares headed in opposite directions, with the latter falling by 1.4 per cent despite improved interim results for the year’s first six months. Last week, 75,000 6PM shares changed hands in three deals. The 6PM group reported a pre-tax profit of £385,000, compared to £245,000 in 2013 – a 54 per cent increase. Revenue for the period amounted to £4.81 million, a 6.4 per cent rise over 2013. The directors are not recommending that an interim dividend be paid.
RS2 shares strengthened by another 1.1 per cent, after failing to sustain an intra-week high of €2.64, on a trading volume worth €130,000.
Plaza Centres plc shares rebounded from the previous week’s 6.7 per cent decline, as three deals of 60,906 shares lifted the equity’s price by 5.4 per cent.
Maltapost plc gained 1.8 per cent after three deals of 8,302 shares.
Loqus Holdings plc tumbled by 19 per cent to its 24-week low of €0.085, after a deal worth €181,000.
Following a month of inactivity, a deal of 1,000 shares in Grand Harbour Marina plc led the equity to close the week down by 0.5 per cent.
The week’s other non-movers were Simonds Farsons Cisk plc, Malita Investments plc, Medserv plc, Midi plc, and Tigné Mall plc – the latter three companies are expected to publish their interim results by the end of the month.
In the corporate bond market, out of the 21 traded issues, nine rose in value, five closed in the red, while seven closed unchanged. Turnover stood at €441,000 – down from €950,000 the previous week. The recently issued Five per cent Tumas Investments plc unsecured € 2024 rose by 1.6 per cent on its first day of trading, to close at €101.55.
In the sovereign debt market, turnover increased twofold to €42.9 million, with the bulk of the 20 traded securities continuing to trend higher – reflecting the declining yields across the European region as European Central Bank president Mario Draghi kept benchmark interest rates unchanged, and hinted that they will remain so for an extended period of time. The Five per cent MGS 2021 (I) issue accounted for 45 per cent of total turnover value – inching 0.2 per cent higher to a record €120.59.
This article, which was compiled by Jesmond Mizzi, managing director of Jesmond Mizzi Financial Advisors Ltd, 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 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 at 67, Level 3, South Street, Valletta, or on Tel: 2122 4410 or e-mail jesmond.mizzi@jesmondmizzi.com.