Mycelx shares in murky water
GURGLE, gurgle, gurgle. Shares of Mycelx Technologies, which is chaired by former Tory UK energy minister Tim Eggar, were flushed down the loo and closed 83.5p or 63.7pc off at an all-time low of 47.5p. The rout followed a warning from the clean-water technology firm that trading conditions will remain challenging throughout the second half of 2015, and a major project it was pursuing has not progressed. A year ago the stock was trading above £4.
Mycelx said that given the adverse market conditions which have resulted in cancellations and delays in capital approvals for major projects across the industry, there have been no new contract wins and, based on the present run rate, it expects total revenue would be in the range of £9.6m to £10.2m, representing a 10pc to 20pc improvement on 2014. As a result of delays, an increasing proportion of its revenue has been pushed into the second half of the year and beyond.
The company added that its timetable is now unclear. As a result, shop broker Numis downgraded to hold from buy and slashed its target price to 144p from 207p. It also downgraded its revenue forecasts for the full-year to £9.9m from £14.9m.
It’s a huge blow to major shareholders including Artemis Investment Management (16.8pc) which have now seen the value of its investment disappear down the plughole after backing the company and its technology from the word go. Mycelx’s technology removes oil from water far more effectively than traditional methods.
Oil refineries and petrochemical plants use its equipment to clean the water they use in their production processes. In the Middle East, companies buy water to use in the oil refining process and then send it to central cleaning plants before it can be re-used. With Mycelx technology, they do it all on site, saving a mint each year. Mycelx was founded in the 1990s by US inventor Hal Alper and oil magnate John Mansfield, who spent eight years perfecting the technology before launching it.
It always used to happen. Wall Street sneezes and the London market catches a cold. It’s certainly been that way this week as renewed weakness on the Street of Dreams – the Dow Jones fell 68.25 points more – upset the applecart in London. The Footsie closed 101.73 points down at 6667.34 and the FTSE 250 was 110.24 off at 17,645.65.
Miners were a major drag with BHP Billiton 71.5p lower at 1180p. Investors voted with their feet after the mining giant said it expected a further hit to full-year underlying profit of up to £417m because of write-downs in its copper business. Management also said the net loss of about £1.34bn on the demerger of coal-mining business South32 would be recognised after tax as exceptional items in June 2015 half year.
Anglo American lost 48.2p to 813.5p after broker RBC Capital Markets said that Anglo should either cut the interim dividend or warn that the final will be reviewed.
Perennial takeover favourite RSA firmed 9.3p to 449.5p on revived bid gossip. The insurer – formerly known as Royal Sun Alliance – is led by former RBS boss Stephen Hester, who was parachuted in last year after an accounting scandal. It has forever been considered to be a takeover target, which could lead to a huge payday for Hester if the rumours ever come true. Remember, Hester was on the team that sold Abbey National to Santander in 2004.
Pub operator Marston’s frothed 3.1p higher to 158.2p after stating trading in the 10 months to July was in line with expectations. Like-for-like sales increased 1.7pc year-onyear, with like-for-like food sales rising 1.6pc. Broker Killik reckons the shares offer good value, at more than 11 times September 2016 earnings, with a 4.7pc yield.
DFS Furniture rose a trim 15.75p to 281.75p after it reported strong trading throughout the second half of 2015, with group sales for the year-to-date 7pc up on the previous year. Second-half sales were 4pc ahead, compared with the same period last year, but the board still expects to deliver a record performance for the full year with underlying results within the current range of market expectations.
Liontrust Asset Management ended up 15p lower at 325p. It followed news that it saw a 0.8pc decline in assets under management to £4.458bn during the first quarter. Flows were stymied by Grexit concerns and the general election. Broker N+1 Singer downgraded to hold from buy.
Cluff Natural Resources jumped a penny or 30pc to 4.38p as industry watchers took a closer look at the company’s significant southern North Sea assets which have increased in value now the company is working closely with Halliburton.
Global payments company Earthport firmed 0.25pto 39.75p on a positive trading update. Full-year revenues advanced 78pc to £19.25m as the company signed up many new customers, including HSBC and Santander. ÷ PROFIT taking ahead of Tuesday’s interim results left ITV 4p off at 270.3p. Broker Peel Hunt is a buyer and lifted its target price to 330p from 300p. It forecasts profits of £379m, up from £322m. It expects the forthcoming Rugby World Cup to bolster the second-half performance and believes the Government’s green paper on the BBC to be benign to commercial TV, of which ITV is the key driver.