Investment News: Chesnara, Direct Line Group, Tangiers Petroleum & more

Tags

Aberdeen, Alliant Techsystems, Atkins (company), Australia, CINE, Competition Commission, Direct Line, Fiscal year, Insurance, Picturehouse, Public company, Riyadh, Saudi Arabia, September, Stock, Trader Dominic Picarda, Victrex

This Blog is sponsored by http://www.reflexecogroup.com

Today’s market overview

Equities are stuck in a rut and The Trader Dominic Picarda expects this mild downtrend to go on for a little while yet.

IC TIP UPDATES:

Chesnara (CSN) has agreed a deal with Direct Line Insurance (DLG) to acquire its Direct Line Life Insurance business for £39.3m in cash. Following the deal Direct Line will pay its shareholders a special dividend of 4p a share. We keep our buy on Chesnara and a sell recommendation on Direct Line.

Cineworld (CINE) has been told by the Competition Commission that it must sell cinemas in Cmabridge, Aberdeen and Bury St Edmonds following its acquisition of the Picturehouse cinema group. We keep ourbuy rating.

Tangiers Petroleum (TPET) has pulled out of a potential farm out deal in Australia after the other party, CWH Resources, failed to fulfil its obligations. We retain our buy recommendation.

KEY STORIES:

Consumer debt purchaser Arrow Global (ARW) has announced that its forthcoming initial public offering will be priced at 205p a share, which will value the company at £357.6m on admission. The company is raising £50m from the float.

Engineer WS Atkins (ATK) has been appointed to work as designer on three of the six lines of the Riyadh metro in Saudi Arabia in a contract worth £75m.

Polymers specialist Victrex (VCT) reports improved trading in the second half of its financial year which meant that full year volumes edged ahead of the previous year at 2,920 tonnes. Both the polymer and biomaterials businesses saw volumes improve by around 10 per cent in the second half after a weaker first half to the year.

Recruiter Robert Walters (RWA) has posted a 7 per cent improvement in gross profits in the third quarter of its financial year with the UK leading the way after growing profits by 21 per cent.

OTHER COMPANY NEWS:

Retail and manufacturing software specialist Sanderson Group (SND) is shifting into the cloud computing space with the acquisition of retail business One iota for £5.4m. Sanderson is raising £3.5m from investors towards the cost of the deal.

Asset manager Impax (IPX) has grown assets under management by 20 per cent to £2.1bn during the year to September and the company expects to meet market forecasts after all its investment strategies outperformed their benchmarks.

Related articles

• Insurer Chesnara to buy Direct Line’s closed life fund (uk.reuters.com)
• RBS to sell fifth of Direct Line (belfasttelegraph.co.uk)
• RBS to sell 18.2% share in Direct Line (itv.com)
• UPDATE 1-RBS raises 630 mln stg in Direct Line share sale (uk.reuters.com)
• RBS pockets £630m in Direct Line stake sale (thisismoney.co.uk)
• RBS pockets £630m in Direct Line stake sale (dailymail.co.uk)
• Thieves had my car for weeks. Direct Line has had it for months (theguardian.com)
• Morocco: Royal Project To Accelerate Development Of Tangier And Place It As A Leading Destination – OpEd (eurasiareview.com)
• Market week: Fed, Syria and Greece make for unsettled outlook (theguardian.com)
• Review of first night at the Arc bar (interzonemusicbristol.wordpress.com)

Investment News: William Hill, Falklands Oil & Gas, Desire Petroleum, Aviva & more

Tags

Australia, Aviva, BTG, Carillion, Desire Petroleum, EasyJet, Falkland, Falkland Island, Falkland Oil and Gas, Green Deal, London, Oman, Premier Oil, Southwark, William Hill

This Blog is sponsored by http://www.reflexecogroup.com

Today’s market overview

Equities have steadied in early trading this morning but the gains are minor and the sense of drift continues with eyes on the continued US shutdown, which The Trader Dominic Picarda assesses in detail in his weekly column.

IC TIP UPDATES:

Sell recommendation. William Hill (WMH) has announced another period of solid growth across most of its business but adverse results and quiet trading in July mean group operating profit reversed by 24 per cent in the 13 weeks to 1 October and is down 4 per cent year to date.

Carillion (CLLN) has announced two new contract wins, one worth £100 with Sussex County Council for energy saving initiatives and the other a £92 contract to build the Kempinski Wave Hotel in Muscat, Oman. The company also issued a trading update which was in line with expectations but contained news of a streamlining of the energy services business due to slower uptake of the Green Deal and a delay to the start of the Energy Company Obligation market, this will cost up to £40m this year. We keep our buy rating.

Development Securities (DSC) has signed an option to develop an office complex adjacent to Southwark tube station in London for which it is paying £8m over the next 18 months. Buy.

Bathrooms specialist Norcross (NXR) says revenues for the six months to 30 September are likely to be 9 per cent ahead of last year at £115m although reported revenues fell when the contribution from the Valdo acquisition is taken out. Profits are expected to be flat at £6m. Management expects this year to be more heavily weighted towards the second half. Buy.

Simon Thompson recommendation. Inland Homes (INL) has posted record annual results with revenues soaring from £6.1m to £31.1m and pre-tax profits more than trebling to £5.2m. The dividend is also increased fourfold to 0.27p. The group has benefited from the sale of 55 homes, compared with nine last year, and the sale of 375 plots against none last year.

KEY STORIES:

The Falklands oil scene has sparked back into life with the proposed combination of Falkland Oil & Gas (FOGL) and Desire Petroleum (DES) in which FOGL will acquire Desire in return for shares. At the same time FOGL has agreed a farm in deal with Rockhopper (RKH) and Premier Oil (PMO) for its PL004a and PL004c licences. The combined group will have funds of $170m and today’s activity means that a fully funded five well drilling campaign is now confirmed with two wells to be drilled in the South Falkland Basin and three in the North Falkland Basin.

Aviva (AV.) has completed the sale of its US operations for $2.6bn to Athene Holding, which will mean cash proceeds of $2.3bn to Aviva.

Ted Baker (TED) continues to trade strongly, posting 30.9 per cent growth in group revenues in the 28 weeks to 10 August and pre-tax profits 49.7 per cent higher at £11.6m. The group posted strong growth across all regions with Asia sales the standout, up by 78.6 per cent from a low base and online sales 51.6 per cent higher.

EasyJet (EZJ) has tightened its profit guidance towards the upper end of its previously indicated range at £470m-£480m for the full year after 3.3 per cent capacity growth and an increase in revenue per seat of more than 6 per cent.

OTHER COMPANY NEWS:

Healthcare specialist BTG (BTG) has increased its revenue guidance following the impact of recent acquisitions from £235m-£245m to £275m-£285m. The company also indicates that it is preparing for commercial launch in the US of its Varisolve varicose veins treatment in the first half of next year assuming it continues its progress through the regulatory process.

Related articles

• Questor share tip: Falkland Oil & Gas shares are a cheap exploration play (telegraph.co.uk)
• Falklands tax dispute clouding oil dream for investors (fuelfix.com)
• Falklands’ Premier Oil joins Argentina’s ‘black list’ of companies ‘illegally’ operating in Malvinas waters (theoilandgasman.wordpress.com)
• Falklands Tax Dispute Clouding Oil Dream for Investors: Energy (bloomberg.com)
• Argentina bans UK firms over Falklands oil groups (telegraph.co.uk)
• UK firms barred from working in Argentina (arabtimesonline.com)
• First Falklands Islands oil production delayed to 2018 (telegraph.co.uk)
• Four British firms barred from working in Argentina (foxnews.com)
• Falklands Oil & Gas jumps 2% on positive survey update (theguardian.com)
• Four British firms barred from working in Argentina (gulfnews.com)

News & Tips

Tags

1997 Asian financial crisis, Auroch, Australia, Business, Fiberweb, India, investing, June, Norway, Norwegian Sea, Poland, San Leon Energy, Seadrill, South Africa

Today’s market overview

With echoes of the 1997-98 Asian crisis, India’s stock market is plunging, bond yields are nudging 10 per cent and capital is flooding out of the country.

IC TIP UPDATES:

South Africa-based gold miner Pan African Resources (PAF) has produced a six-month trading statement which revealed production of 130,500 ounces of gold in the year to June, including a contribution of 34,200 ounces from February’s Evander mine acquisition. The company said that underlying earnings will come in 34-44 per cent higher in rand terms compared to last year, and 25-35 per cent higher in sterling.

UK independent Faroe Petroleum (FPM) has secured a pair of farm-outs on licences in the Norwegian Sea. Spike Exploration Holdings and Concedo have acquired 15 per cent and 5 per cent respective stakes in the Norwegian Sea licence PL645. In return, the companies will carry costs associated with the Novus exploration well. Faroe Petroleum has contracted Seadrill’s West Navigator drillship to drill the Halten Terrace well, now expected to spud in November.

KEY STORIES:

Baobab Resources (BAO) has agreed a deal with Australian explorer Auroch Minerals over a portion of its Mundonguara exploration licence. Auroch will earn an 80 per cent stake in an exploration area adjacent to its own Manica gold project, which hosts 3m ounces of gold. To earn its stake Auroch must spend $1.5m on exploration and when completed it will have the opportunity to buy-out the remaining 20 per cent of the venture from Baobab.

Industrial manufacturer Fiberweb (FWEB) confirmed that has received a takeover proposal from Polymer Group Inc, which has been given until Sept. 17 to formalise a bid. The proposal is for 97.5p a share in cash plus the interim dividend of 1.2p a share, announced Aug. 2 and payable on Nov 1. Fiberweb said it would be its intention to recommend an offer from Polymer were it to be made at that price.

OTHER COMPANY NEWS:

San Leon Energy (SLE) is to assume operatorship of the Jany C1 well on the Nowa Sol licence in the Southern Permian Basin in Poland, about 15km north of its Czaslaw-1 well.

Scancell Holdings (SCLP), a developer of novel immunotherapies for the treatment of cancer, announced that its ordinary shares have been included on the Quotation Board of the Open Market of the Frankfurt Stock Exchange with effect from today.

Related articles

• Kenya miners protest licence cancellations (africareview.com)
• Statoil finds gas in Norwegian Sea (upi.com)
• OMV seals output with $2.65b North Sea stakes (gulfnews.com)
• Green Cliffs, Faroe Islands (stillhigh.wordpress.com)
• Cunard Line Captain Takes Ship Home To Show Friends In The Faroe Islands (chriscruises.com)
• An Asian Crisis Looming (globalclarity.wordpress.com)
• The Second Asian Crisis? Feeling the impact of Chinese monetary tightening (marketmonetarist.com)
• Statoil funds growth, OMV seals output with US$2.65B North Sea deal (business.financialpost.com)
• Uruz – second rune of the futhark (dutchwitch.wordpress.com)
• European stocks end lower (bigpondnews.com)

News & Tips

Tags

Atacama Desert, Atkins, Australia, Baker Tilly International, Beowulf Mining, BHP Billiton, Brian Gladden, Carl Icahn, Dell, Lloyds Banking Group, Michael Dell, Moss & Associates, OZ Minerals, Personal computer, Private equity, Range Resources, Rio Tinto Group, RSM Tenon, Sweden, Takeover, Texas, Wall Street

Today’s market overview

The FTSE 100 is flatlining following yesterday’s fall, after Asian markets and Wall Street dropped on expectation that the Fed will taper QE sooner than originally anticipated after promising economic data.

IC TIP UPDATES:

Workers at the world’s biggest copper mine, in Chile’s Atacama Desert, have returned to work after an unannounced 24-hour stoppage. BHP Billiton (BLT), which controls the mine, has yet to respond to their demands for better pay, an annual bonus and improved working conditions. Workers will have another meeting on Friday night to decide whether to go on strike again. Rio Tinto (RIO) also holds a 30 per cent stake in the mine.

Surgical Innovations (SUN)said it had made a strong first half, and that it continues to trade in line with market expectations. Revenues for the six months were 28 per cent ahead of the same period last year at £3.88m, while adjusted cash profits were £1.14m.

WS Atkins (ATK) said it has signed an agreement to dispose of the ongoing operations of Peter Brown, its US construction management at risk business, to Moss & Associates. As part of this agreement, Atkins will pay Moss £2.6m. Atkins expects to report a loss on disposal of approximately £3.0m in respect of the transaction.

KEY STORIES:

Iron ore explorer Beowulf Mining (BEM) has delivered strong initial assay results from its drilling programme at Kallak South in northern Sweden. Results include one inclined drill hole with a long intercept of 89.46 metres at about 32.1 per cent iron, while a section in the same hole returned the highest ever recorded iron content from the Kallak South deposit to date of 55.9 per cent iron.

Australian miner OZ Minerals is currently carrying out due diligence onHerncia Resources’ (HER) iron oxide copper gold project in northern Chile with a view to taking a majority stake. The existing joint venture will expand to include the larger project area. Under the terms of the original joint venture agreement, OZ will spend $3m over 20 months to earn a 51 per cent share of Guamanga. That stake will rise to 80 per cent if the Australian firm spends an additional $5m over 24 months.

Range Resources (RRL) has responded to recent weakness in its share price, saying it is not aware of any particular event that would account for this share price weakness. The company confirmed that it is focused on ramping-up production from its operations in Trinidad, where production has increased by over 30 per cent since April

The UK’s only listed accountancy practice RSM Tenon (TNO) said that takeover talks with rival Baker Tilly were continuing, but any deal is likely to result in minimal value for shareholders. The highly indebted company revealed last month that it had received an unsolicited approach from Baker Tilly, but a potential transaction would require the support of its sole lender Lloyds Banking Group (LLOY).

OTHER COMPANY NEWS:

Dell’s quarterly profit has plunged 72pc from a year ago as the struggling computer giant was hit by weak PC sales. Profit for the second quarter fell to $204m, compared with $732m in the same period last year, although the results were slightly better than analyst estimates.

Related articles

• Rio Tinto posts record iron production (bigpondnews.com)
• Banks and miners drag market lower (news.theage.com.au)
• Stocks to watch on Tuesday (news.smh.com.au)
• Aust share market is slightly higher (news.theage.com.au)
• What Australia’s Election Means For Miners: J.P.Morgan (blogs.wsj.com)
• Rio Tinto half-year profit plunges by 71 per cent (abc.net.au)
• ‘Klondike laws’ spur Swedish fury at miners (thelocal.se)
• Call for actions in #kallak Gállok. Spread the word! (kolonierna.wordpress.com)
• Mining at ‘Breaking Point’ as Investors Flee, Gold Fields Says (bloomberg.com)
• Mongolia says Rio Tinto copper mine can start shipments to China (emergingfrontiersblog.com)