Financial equities retreat in May

The MSE Index extended its losing streak as it registered a decline for the third consecutive month. The index fell by 0.84 per cent in May, to close at 4,637.053 points. Turnover amounted to €10.1m spread across 20 equities of which 13 slipped, six gained ground and one closed unchanged.

Mapfre Middlesea plc shares were the worst performers in the financial sector having stumbled by 5.7 per cent as 13 trades of 18,440 shares were executed, to close €0.12 lower at €1.98.

Bank of Valletta plc shares fell by €0.075 or 3.3 per cent across 286 trades worth €2.5m, to close at €2.175. The equity traded ex dividend during the month as shareholders received an interim dividend of €0.0450 gross per share, after the interim results. Likewise, HSBC Bank Malta plc shares edged 2.4 per cent lower as 77 transactions of 289,629 shares were struck, closing €0.05 lower at €2.

Lombard Bank Malta plc

shed 0.4 per cent of its share price as 4,645 shares changed ownership over six deals, to close at €2.39. On a similar note, FIMBank plc shares declined by three per cent across 28 trades of 197,348 shares, closing at $0.775.

MaltaPost plc shares oscillated between a monthly high of €2.029, at which it closed and a low of €1.901. The local postal operator’s shares declined by one per cent in May and were active on 13 deals of 36,077 shares. The Board of Directors of the company approved the Unaudited Condensed Interim Financial Statements for the sixmonth period ended March 31, 2017. The company registered a profit before tax of €1.8m, compared to €1.7m reported for the same period last year. Revenue for the period under review amounted to €17.7m, an increase of 25.9 per cent, when compared to the same period in 2016. Meanwhile, earnings per share remained at €0.03.

On a positive note,

Simonds Farsons Cisk plc (SFC) shares

increased by a further 1.5 per cent as 17,725 shares changed hands over 10 deals, to close just below their all time high of €7.551 at €7.55. The company registered a record annual profit of €12.1m for the year to January 2017, compared to €11.2m registered in the previous financial year. The group’s revenue for the period under review amounted to €88.1m - a rise of 2.4 per cent from 2016. Earnings per shares increased from €0.374 to €0.404.

The strong performance was registered across the group on varying levels. Throughout the year, management has continued to drive forward and implement diverse measures aimed at further improving productivity and overall efficiency along with higher quality standards.

The Board of Directors of SFC has resolved to recommend for the approval of the Annual General Meeting (AGM) the distribution, out of tax exempt profits, a final net dividend of €2.4m that is €0.08 per ordinary share of €0.30, to be paid on June 28, 2017.

An interim net dividend of €1m, that is €0.0333 per ordinary share, was approved at the Board Meeting held on September 28, 2016 and distributed to shareholders on October 19, 2016. Therefore, the total net dividend to the ordinary shareholders relating to the financial year ended January 31, 2017 amounts to €3.4m, that is €0.1133 per ordinary share.

PG plc shares had an impressive month. The equity started trading on May 4, 2017 and has registered a 28 per cent rally for the month, to close at €1.28. A total of 234 deals of 2.8m shares were active. PG mainly comprises of the operation of PAMA Shopping Village, PAVI Shopping Complex as well as Zara and the Zara Home Franchise at Alhambra and PAMA Outlets. The PAMA Shopping Village and PAVI Shopping Complex operate as large supermarkets with ancillary retail, as well as the rental of outlets to third parties.

RS2 shares appreciated by 10.5 per cent when one takes into consideration the bonus share issue of one share for every twelve shares held. The IT equity was negotiated across 87 trades of 492,978 shares, to close at €1.53.

The company reported that during the first months of 2017, the group continued with its strategy of intensively growing itsmanaged services business. As announced in January 2017, RS2 Smart Processing concluded threemajor agreements with one of the largest acquirer in Europe, a Latin American company and a Canadian company.

In addition to these new agreements, the group has already concluded letters of intent and is in an advanced stage of contract negotiation for delivery of managed services to clients in Argentina, Australia, UK and Portugal.

Implementations of these new engagements is currently underway and completion is expected to occur by the end of this year. When completed, the number of live clients for the group’s managed services business will multiply threefold and will consequently increase the recurring revenue from this business stream.

Revenue from transaction services from these agreements is expected to start materialising in the later part of 2017.

Loqus Holdings plc shares were the only non-movers for the month, having traded flat at €0.17 over six trades of 44,117 shares.

Software plc Malta International Airport plc (MIA) shares oscillated

between a monthly high of €4.15 and a low of €4.09 to ultimately close 0.02 per cent lower at €4.149. The local airport operator announced that during April, passenger movements registered an increase of 26.6 per cent, surpassing the half million mark for the first time that month.

MIA welcomed 530,576 passengers on the back of an increase of 17.7 per cent in seat capacity and an improvement of 5.3 percentage points in seat load factor (SLF). The strong performance partly stemmed from the Easter holiday effect, together with the start of new operations and the extension of certain winter routes into the summer period.

In another announcement, the company reported that during the period under review (January 1, 2017 – March 31, 2017) the financial position of the company has remained sound and the performance is superior to Q1 2016.

Passenger numbers in this period grew by 22.2 per cent, resulting in a 15.8 per cent increase in turnover, equivalent to €13.4m. Total expenditure was at €7.6m, an increase of 5.3 per cent. Meanwhile, profit before taxes increased by 64.1 per cent from €2.5m in Q1 2016 to €4.2m in Q1 2017.

GO plc shares swayed between a monthly high of €3.57 and a low of €3.40 to ultimately close 0.3 per cent lower at €3.50. The telecommunications equity witnessed 58 trades of 199,528 shares.

International Hotel Investments plc shares fell by 3.1 per cent across 15 deals of 70,376 shares, closing at €0.62. The company published its interim statement where, among other information, it was announced that CHI has entered into preliminary agreements to provide technical and management services in relation to the development of an iconic hotel and residential tower under construction in Doha, Qatar. The project is owned and is being developed by a leading, local private conglomerate, and was designed by the ZahaHadid firm of Architects.

Medserv plc shares headed the list of fallers having stumbled by a significant €0.20 or 13.8 per cent, to close at €1.25. The equity was negotiated across 39 deals of 384,252 shares. The oil and logistics company announced that the increase in the price of oil has shown signs of resilience and the market may be entering a more stable period when compared to the recent past. This has allowed the major international oil companies (IOCs) to return to greater profitability, as evidenced by recent first quarter results. This turnaround was greatly helped by the agreement reached by OPEC and others to reduce output levels, as well as by a painful restructuring process. These two actions addressed the new industry reality and could usher in a period of stability. The company expects this to have a knock-on effect on the service company sector which should benefit the company in the near term.

Tigne Mall plc shares followed suit having sagged by 10.9 per cent, closing €0.12 lower at €0.98 - a nine month low. The equity witnessed 13 trades of 229,000 shares. Malita Investments plc shares stayed faithful to their ongoing losing streak having declined by 2.7 per cent as 29 transactions of 194,550 shares were executed, closing at €0.72.

In the same sector, Plaza Centres plc shares edged 1.9 per cent lower across five trades of 20,400 shares, to close at €1.04. Similarly, Malta Properties Company plc shares extended April’s loss having slipped by 1.4 per cent in May across 47 deals of 241,934 shares, closing at €0.51.

On a positive note, MIDI plc shares advanced by five per cent as 57,300 shares changed ownership across 10 deals, closing at €0.315. The company had announced that the payment of a final dividend of €0.007 per share will be paid to those shareholders on the register as at close of business on May 19, 2017 and payable by not later than July 6, 2017.

GlobalCapital shares recovered April’s loss, having increased by 13.3 per cent as five trades of 35,500 shares were struck, to close €0.04 higher at €0.34. The company announced that it will be convening an Extraordinary General Meeting on June 23, 2017 during which shareholders will be asked to consider and approve a number of resolutions mainly related to its capital and balance sheet structures. The company also announced its intention to conduct a rights issue subject to regulatory approval.

In the corporate bond market turnover totalled to €8.1m spread across 45 issues of which 23 gained ground, 14 fell and eight closed unchanged. The 6% Med-

serv plc Sec. & Grntd € Notes 2020-2023 S1 T1 was the best

performer having advanced by 2.4 per cent, to close at €109, while the 4.5% Medserv plc Unsecured € 2026 headed the list of losers having declined by 1.4 per cent, closing at €102.01.

The Board of Directors of

Tumas plc Investments plc

announced that it resolved to redeem the 6.2% Tumas Invest-

ments plc € 2017 – 2020 Bonds on July 10, 2017.

The company announced that the Listing Authority of the MFSA approved the admissibility to listing of €25m in bonds redeemable in 2027. The net proceeds from the new bonds will be used by the company to finance the redemption of the maturing bonds.

Mediterranean Investments Holding plc (MIH) announced

that the Board of Directors has resolved to redeem the €28.5m, 7.15% EUR denominated bonds 2015-2017,the £4.3m 7.15% GBP denominated bonds 2015-2017, and the $7.1m 7.15% USD denominated bonds 2015-2017, on July 6, 2017 in accordance with the terms of the prospectus dated June 14, 2010.

The Board of Directors announced that the Listing Authority of the MFSA had approved the admissibility to listing of €40m 5% MIH Unsecured Bonds 2022 to be issued at par and guaranteed by Corinthia Palace Hotel Company Ltd.

Orion Finance plc announced the issuance of €5m 4.75% Unsecured Bonds maturing in 2027 at an issue price of €100 per bond, guaranteed by Orion Retail Investments Limited, a limited liability company incorporated and registered in Malta. The Guarantor is the parent company of the Issuer (together referred to as the Orion Group) and is a subsidiary of Camilleri Holdings Limited. The main activity of Orion Retail Investments Limited is that of acting as a property managing company. The bonds were approved for admission to Prospects by the Malta Stock Exchange. Prospects, is the market regulated as a Multilateral Trading Facility operated by the MSE providing a venue for start-up and small to medium-sized enterprises to come to market - whether it is for a bond or an equity issue.

The Prospects Committee of the MSE also approved the application for admission to Prospects of the proposed issue of €1m Anchovy Studios plc 5.5%

Unsecured Bonds 2027.

Anchovy Studios plc carries on the business of performance marketing and lead generation services to clients operating across a spectrum of sectors – it specialises in attracting users from a diversity of online and mobile channels and directing them to its customers.

In the sovereign debt market 29 issues were active of which 18 advanced and eight declined and three remained unchanged as turnover reached €35.3m. The 3% MGS 2040 (I) was the most liquid issue having witnessed a turnover of €7.6m. The long-dated issue registered the best performance having increased by 1.8 per cent, to close at €112.27. This article, which was compiled by Jesmond Mizzi, Managing Director of 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 Firm 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 at 67 Level 3, South Street, Valletta, or on Tel: 21224410, or email jesmond.mizzi@jesmondmizzi.com