Investors’ attention this week and next week will focus on the new Malta Government Stocks (MGSs) and the AX Investments plc bond issue as subscriptions both open to the public tomorrow week.
Last Friday, the Treasury announced the first MGS issue for 2014 of €100 million, subject to an over-allotment of €60 million, over three stocks. The issues will be 4.45 per cent MGS 2032, 3.3 per cent MGS 2024 and 3.2 per cent MGS 2019 fungible issue. Prices for the issues will be announced on Thursday, while applications will open on February 24 and close on February 26, or earlier at the discretion of the Accountant General.
Meanwhile, the new bond issue by AX Investments plc of €40 million, due on March 6, 2024, paying an annual coupon of six per cent, will kick off this week as existing bond holders have a priority to roll-over their existing bonds by Thursday. Meanwhile, the pre-placement offer to financial intermediaries will also take place on Thursday. The public offer opens on February 24.
Last week, the Malta Stock Exchange (MSE) index rose for the fourth consecutive week, inching up 0.08 per cent to 3,719.691 – a three-year high. Several equities ended the week at record highs, namely RS2 Software plc, Simonds Farsons Cisk plc (SFC), and Malita Investments plc. But most of last week’s positive momentum was offset by losses in International Hotel Investments plc (IHI), Fimbank plc, and Lombard Bank plc shares.
In the four-day trading week, turnover plunged by 37 per cent to €700,000. A total of 18 equities were traded, of which nine closed in the black, while five drifted lower and three closed unchanged.
Go plc was, once again the best performing equity, as its shares surged by 5.1 per cent to a 44-month high. There were over 23 deals of 55,753 shares in the equity. So far this year, Go shares are in the lead, with a gain of 14 per cent.
New record highs were registered in the IT sector. A total of 59,380 RS2 shares changed hands in 28 deals – the second highest turnover by value – lifting the equity price 1.3 per cent to €2.365.
Similarly, Crimsonwing plc advanced 1.2 per cent after a single trade of 2,543 shares. Last Thursday, the company published its interim directors’ statement, pointing out that there has been further improvement in the company’s revenue as at the end of the third quarter ending December 2013, with a 16 per cent rise over the same period in 2012. The company is expecting to meet its full-year revenue target, with a threshold above €20 million.
The company also highlighted its strong demand as a result of new international engagements, and a new strategic agreement with Megabyte Ltd. Last month, the company was declared National Public Champion for Malta in the European Business Awards 2013-2014.
In the banking sector, Bank of Valletta plc (BOV) shares reversed the previous week’s 0.8 per cent loss, after the week’s highest turnover of €166,000. Last week, BOV shares rose to a high of €2.495 and a low of €2.47.
On the other hand, trading in HSBC Bank Malta plc shares, worth €78,000, left no impact on its price, closing unchanged at €2.60, after failing to lock-in gains at highs of €2.62. Investors are eagerly awaiting the 2013 financial results due on February 24.
On the downside, Lombard Bank plc shares more than erased the previous week’s 2.2 per cent gain, as nine deals of 19,452 shares dragged the equity’s price down by 2.6 per cent.
Meanwhile, Fimbank plc shares fell by a further 2.1 per cent, to a 13-month low after a single deal of 5,000 shares.
Three deals of 17,868 Simonds Farsons Cisk plc shares pushing the equity’s price up 1.7 per cent to an all-time high of €3.
Another record high was reached by the special purpose vehicle Malita Investments plc, as its shares strengthened 1.9 per cent after four deals of 15,157 shares.
Midi plc also reached a 10-month high, after trading of 183,000 shares led to a 4.4 per cent gain in its closing price.
Shares of Medserv plc closed the week up by 1.6 per cent, after a single deal of 4,000 shares was struck.
One other gainer was Middlesea Insurance plc, which recovered its previous week’s loss by gaining over two per cent on three deals of 2,995 shares.
Last week’s primary laggard was IHI, whose share price shed 3.3 per cent, after 3,214 shares were exchanged in a single trade.
Malta International Airport plc (MIA) shares extended their previous week’s loss of 0.5 per cent by a further 0.7 per cent. Last Friday, MIA announced that its board of directors will be meeting on March 4 to approve the company’s financial statements for the year ending December 31, 2013, and to consider the payment of a dividend.
One other faller last week was Loqus Holdings plc, whose shares closed down 1.1 per cent after two transactions of 13,259 shares.
Maltapost plc published its interim directors’ statement in which it reported that overall performance remained more or less in line with the same comparable period last year. The company said it had a satisfactory increase in turnover, despite the downward trend in letter mail volumes. The increase in turnover was partially offset by wage increases, inflationary pressures and higher cross-border mail delivery cost.
Maltapost said it will seek revenue and profit growth by diversifying its products and services, and by exploiting structural trends in e-retailing. The equity closed unchanged at the €1.1 price level.
The week’s other non-movers were Plaza Centres plc and Tigné Mall plc closing at €0.57 and €0.31 respectively, both trading once on low volume.
In the corporate bond market, 21 issues were active, of which six rose in value, eight fell, while seven closed unchanged. Turnover soared by more than 84 per cent to €1.24 million. Last week’s worst performing issue was the 4.9 per cent Gasan Finance 2019-2021, which lost 2.3 per cent.
Last week, Grand Harbour Marina plc announced that it has purchased a total of €259,900 of its seven per cent bonds 2017-2020 from its bondholders. The bonds will be completely cancelled from the outstanding bond issue, which cannot be re-issued or re-sold.
In the sovereign debt market, total turnover was in line with the previous week’s level at €8.4 million, with most stocks trading lower as investors awaited news on the new issues.
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.