Investment News: De La Rue, Home Retail, Asos, Quindell Portfolio, Sirius Minerals & more

Tags

Argos, Arqiva, ASC, BBC, Business, De La Rue, Home Retail Group, Homebase, June, National Park Authority, Premier Oil, QPP, Quindell Portfolio, Trader Dominic Picarda, United States, Vietnam

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

Today’s market overview

Equities are off colour in early trading but The Trader Dominic Picarda believes that QE in the US is here to stay until early 2014 at the earliest after the latest jobs data and that the reversal today will only be a dip which represents another buying opportunity.

IC TIP UPDATES:

Sell recommendation. De La Rue (DLAR) shares have slipped back today after the bank note printer said that revenues are tracking marginally lower due to tough conditions in its end markets with banknote print volumes down 10 per cent in the first half. Improving performance in other areas of the business mitigated this a little and the order book is up by £25m to £232m since the start of the year. Pricing pressure is expected to continue through the next financial year. Operating profit for the full year is forecast to come in around the £90m level, below the three year profit improvement plan target of £100m for 2013/14.

Premier Oil (PMO) says full year average production is likely to be in the 57,000-59,000 barrels of oil per day range, which is slightly light of expectations due to pipeline and gas export issues in both the UK and Vietnam. But by the end of the year production should be running at 65,000 barrels of oil per day. Buy.

Well head technology specialist Plexus Holdings (POS) has posted record results for the year to June with revenues up by 30 per cent and profits 38.3 per cent higher at £4.27m and strong recent order intake also bodes well for a continuation of this performance. Meanwhile the final dividend is increased by 10 per cent giving a 0.99p payout for the full year. We keep our buy rating.

KEY STORIES:

The improving performance at both Argos and Homebase helped Home Retail (HOME) post 3 per cent sales growth in the first half to just shy of £2.6bn. Argos like for like sales rose by 2.3 per cent and Homebase improved like for like sales by 5.9 per cent, helped by the good summer weather.

Online clothing retailer Asos (ASC) has continued its strong progress with another set of stellar annual results showing a 39 per cent rise in group revenues to £769m and pre-tax profits of £54.7m, up 37 per cent. Margins edged up by 1 per cent with UK sales rising 34 per cent and international sales by 44 per cent. International now accounts for 63 per cent of the total sales.

British American Tobacco (BATS) has grown revenues by 3.5 per cent at constant exchange rates, or 0.9 per cent at actual exchange rates despite a 3.2 per cent fall in cigarette volumes and a 3 per cent decline in tobacco volumes. Its key ‘Global Drive’ brand cigarettes grew volumes by 1.9 per cent and gained market share in their key markets.

Sports Direct’s (SPD) domination of high street sports retail continues with group sales for the nine weeks to 29 September rising by 15.1 per cent to £463.7m and gross profits up by almost 20 per cent to £199.8m despite challenging comparatives from last year’s strong Olympics and Back to School period.

Temporary power specialist APR Energy (APR) accompanied a solid trading update, showing revenues of $84m in the third quarter, with news of the acquisition of GE’s Turbine Rental business for a cash and shares consideration of $314m. The deal also sees APR and GE form a strategic alliance with GE also becoming a key investor in APR.

Set top box technology specialist Pace (PIC) is to acquire Aurora Networks for $310m in cash. Aurora is a developer and manufacturer of network access products for broadband networks.

OTHER COMPANY NEWS:

Quindell Portfolio (QPP) has won a contract to provide telecoms services to Arqiva, which offers communications and media services to the media sector, including a deal with the BBC.

Sirius Minerals (SXX) says it is considering withdrawing its current planning application for the North York Potash project and submitting a new application under which it may extend the original project boundary which would mean submitting applications to both the National Park Authority and North Yorkshire County Council. Any change would not affect current predicted timelines.

Related articles

• De La Rue expects to miss profit growth target (scotsman.com)
• Michigan contract for cigarette stamps questioned (kansascity.com)
• Kuwait contracts with De La Rue to produce polymer currency (thecurrencynewshound.com)
• CBSI Launches Upgraded Banknote (solomontimes.com)
• Beyond America’s New $100 Bill: The World’s Best Currency (fool.com)
• De La Rue (ritholtz.com)
• Questions on ‘new DOW penalty’, plastic money (arabtimesonline.com)
• Argos and Homebase in sales rise (bbc.co.uk)
• Argos and Homebase owner sees profits soar (metro.co.uk)
• Housebuilders benefit from Goldman push (telegraph.co.uk)

Investment News: RPS Group, Spectris, Bonmarche, Leyshon Resources & more

Tags

Asia, Bonmarché, BSIF, Business, China, June, Norway, Oxfordshire, Provident Financial, RPS Group, September, Spectris, Vanquis Bank

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

Today’s market overview

Shares rose in early trading, buoyed by good economic data from China overnight and The Trader Dominic Picarda believes we are in for a positive period.

IC TIP UPDATES:

RPS Group (RPS) has announced plans to acquire Norwegian project management consultancy OEC Consulting for up to £31.5m. It specialises in North Sea oil and gas but also works in the health sector and offers facilities management services in Norway. In 2012 it made profits of £3.5m from turnover of £27m. We maintain our buy on RPS.

KEY STORIES:

Instrumentation and controls business Spectris (SXS) says that revenues for the three months to September rose by 5 per cent compared with last year, with organic growth up 3 per cent. A rebound in Europe, where sales grew 8 per cent and improving sales in North America made up for a 1 per cent reversal in Asia.

Retailer Bonmarche has become the latest company to announce its intention to float. The specialist retailer, which offers a value proposition to women aged 55-plus and trades from 264 stores, wants to list on Aim. No new money will be raised but existing shareholders will cash in some of their holdings.

Provident Financial Group (PFG) has performed in line with expectations with its Vanquis Bank operation performing ahead of its internal plan but the Consumer Credit Division continuing to suffer from weak demand.

Financial services specialist Brooks Macdonald (BRK) grew discretionary funds under management by 5.2 per cent in the past quarter to £5.37bn, boosted by both improved investment performance and positive inflows. Advisory funds edged up to £354m and the Braemar Estates property division saw property assets under management grow by 2.9 per cent to £1.07bn.

Leyshon Resources (LRL) expects to hold a shareholder meeting in late November to approve the demerger of its energy assets into a separate Aim listed company which will also have $35m in cash reserves. Existing shareholders will receive shares in the new business.

Final results from International Mining & Infrastructure Corporation(IMIC) reveal little in terms of financials as the company has spent most of the past few months edging towards its acquisition of Afferro Mining (AFF), which is now close to completion and brings with it highly prospective iron ore projects in Cameroon.

E2V Technologies (E2V) has appointed Stephen Blair of Spectris as its chief executive, he begins in January.

OTHER COMPANY NEWS:

Bluefield Solar Income Fund (BSIF) has signed an agreement to buy its fourth large scale solar plant in the UK. The plant, on an agricultural site in Oxfordshire, is costing £17m and takes Bluefield’s total investment so far to £55m across four solar plants. The company is on track to pay a 4p a share dividend for the year to June followed by 7p the following year, rising with inflation after that.

Related articles

• Bonmarché prepares stock exchange flotation (theguardian.com)
• Bonmarché float shows high street turmoil easing (telegraph.co.uk)
• Bonmarché targets garden centre customers (telegraph.co.uk)
• UK: Fashion retailer Bonmarche to float on stock market (eadt.co.uk)
• MARKET REPORT: Spectris set to shine after US shutdown drama (dailymail.co.uk)
• British retailer Bonmarche to list shares on AIM (uk.reuters.com)
• Photo Release — e2v Announces Appointment of Chief Executive (biomedreports.com)
• RP-Sanjiv Goenka Group’s power plant in Maharashtra synchronised (news.in.msn.com)
• RPS Auria Sector 88 Greater Faridabad (roofontop.wordpress.com)
• The Week Ahead: Investors unlikely to clean up on McBride (independent.co.uk)

Investment News: Rolls Royce, Thomas Cook, Petroceltic International, Petra Diamonds & more

Tags

Airbus, Algeria, Berlin Ringbahn, Bulgaria, Business, Deutsche Bahn, Egypt, Energy, Japan Airlines, June, North Sea, Petra Diamonds, Petroceltic International, Pork, Romania, Sonatrach, United States, US government

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

Today’s market overview

Equities continue to drift downwards as the continued shutdown of the US government continues to cause consternation. But The Trader Dominic Picarda is less concerned, and sees this as a necessary pull back before the rally resumes.

IC TIP UPDATES:

Rolls Royce (RR.) has announced support contracts with the US government worth $496m in total. Both contracts are for field and engineering support for T-56 engines with the $406m Defense Logistics Agency contract spread over six years and $90m the Navy contract over five years. Rolls also announced that Japan Airlines has placed an order for 36 A350 Airbus aircraft, which use Rolls’ Trent engines. We keep ourbuy recommendation.

Thomas Cook (TCG) has announced the sale of its Egyptian and Lebanese-based businesses for £6.5m as it continues to refocus its business. The company will still offer holidays in Egypt. Buy.

Petroceltic International (PCI) announces that the Algerian state oil company Sonatrach has exercised its right to buy an 18.75 per cent stake in the Isarene Production Sharing Contract. The terms include a $20m down payment, $140m of development carry and two $10m milestone payments dependent on performance of the prospect. This takes Sonatrach’s holding to 43.375 per cent, with Petroceltic holding 38.25 per cent and Enel 18.375 per cent. We keep our buy rating.

Quadrise Fuels (QFI) ended the year to June with £3.2m in the bank and no debt as it continues to advance its MSAR low cost heavy fuel oil alternative. The company has signed a deal with Maersk which will see its fuel trialled in the two main engine types for heavy ships in the coming months. We maintain our buy recommendation.

Petra Diamonds (PDL) says that despite some industrial action the company’s mines produced 816,375 carats during the three months to 30 September, which leaves it on track to produce its target of 3m carats for the year to June 2014. Buy.

New Britain Palm Oil (NBPO) has announced a new joint venture to develop a new hybrid variety of high yielding sustainable palm oil plants.Buy.

KEY STORIES:

Troubled pawn broker Albemarle & Bond (ABM) has brought forward the appointment of Chris Gillespie as chief executive and also confirmed the appointment of Colin Whipp as chief restructuring officer.

Pork products specialist Cranswick (CWK) has seen strong sales growth in the six months to September with underlying turnover up 13 per cent. But record high pork prices have affected margins and mean half year results, and probably full year performance too, will be ‘broadly similar’ to last year.

National Express (NEX) has been shortlisted for the tender to run the Berlin Ringbahn, which is currently operated by Deutsche Bahn.

Optical products specialist Gooch & Housego (GHH) has overcome some uncertainty in its end markets to produce profits in line with expectations. It also ended the year to September with an order book of £27.8m, up 12 per cent on last year.

OTHER COMPANY NEWS:

The Bluefield Solar Income Fund (BSIF) has agreed deals to buy five large scale solar power plants, which when completed will mean the fund has committed 75 per cent of the funds raised at its float earlier this year. The company is also in advanced negotiations on another £175m worth of acquisitions.

Adriatic Oil, an exploration company with interests in the North Sea and Adriatic, has announced its intention to seek an Aim admission.

Related articles

• Algeria’s Sonatrach pre-empts Ain Tsila sale by Petroceltic International (irishtimes.com)
• Petroceltic Spuds Shakrok-1 (iraq-businessnews.com)
• Petroceltic International appoints Ian Craig as Non-Executive Director (talent4boards.com)
• The Week Ahead: Petra still showing diamond potential (independent.co.uk)
• Petroceltic Results and Operational Update (iraq-businessnews.com)
• Pre-tax losses widen at Petroceltic (irishtimes.com)
• Questor share tip: Only for the brave but Petra Diamonds shares look cheap (telegraph.co.uk)
• Broker Panmure names its ‘top picks’ (telegraph.co.uk)
• Irish energy firm kicks off drilling in Romania (energyandnuclear.com)
• Irish energy firm kicks off drilling in Romania (assystem.wordpress.com)

Investment News: Parkmead Group, Wolseley, Walker Greenbank, Ceres Power & more

Tags

Business, Ceres Power, Debt, investing, June, Kitbag, Kleeneze, North Sea, September, UBS, United States, Wolseley, Wolseley plc

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

Today’s market overview

Markets have opened up flat after yesterday’s sell off as investors consider the implications of the shutdown of government agencies in the US due to the political stand-off over the budget. But The Trader Dominic Picarda is unconcerned about this development, seeing as it has happened many times before, and thinks equities will get over it in time.

IC TIP UPDATES:

Oil explorer Parkmead Group (PMG) says that its Pharos exploration well in the UK Southern North Sea has commenced drilling. The prospect is adjacent to Parkmead’s Platypus field and could hold up to 500bn cubic feet of gas. We keep our buy rating.

Construction and support services specialist Renew Holdings (RNWH) reports that trading in the second half of its year to end-September continued to be encouraging across all areas of its business. We maintain our buy recommendation.

Avingtrans (AVG) announces that its Sigma Precision Components business has signed a 10 year agreement with Rolls Royce (RR.) worth £55m to supply self-locking nuts. This is the second such long term contract with Rolls Royce that Avingtrans has announced within the past year. Buy.

Juridica Investment (JIL) has updated investors on its Antitrust portfolio, which has a carrying value of $139m. The company, which invests in legal cases primarily in the US, says two of its price-fixing cartel cases will come to court next year and a third could also be heard in 2014, furthermore a monopoly case will also be heard next year but another monopoly case has been dismissed on appeal although there could be more appeals. Management believes that the next 18 months could see the investments in this portfolio begin to bear fruit. We keep our buy rating.

KEY STORIES:

Builders merchants Wolseley (WOS) continues to enjoy a decent turnaround in performance with like for like revenues in its ongoing businesses up 2.9 per cent in the year to 31 July and trading profits rising from £655m to £725m. The ordinary dividend is raised by 10 per cent to 66p and the company is also proposing a special dividend to return £300m to investors before the end of the year.

Stockbroker Charles Stanley (CAY) says results for the six months to September should be in line with expectations after a strong opening quarter to the year was followed by a more muted second quarter as trading calmed down over the traditionally quieter summer months.

Home shopping specialist Findel (FDL) reported a 5.2 per cent improvement in group sales in the first half of its financial year, driven primarily by its Express Gifts and Education Supplies businesses with the Kleeneze and Kitbag businesses both posted negative growth.

St Modwen Properties (SMP) says the recovering sentiment in the regional property markets alongside government support and improving consumer confidence bode well for its business.

Walker Greenbank’s (WGB) half year results confirmed further solid progress for the supplier of luxury interior furnishing with overall sales up from £38.3m to £39.1m and adjusted profits up 13 per cent to £3.06m. Licensing income rose by 26 per cent and manufacturing produced a record performance with sales up 4 per cent to £15.9m.

OTHER COMPANY NEWS:

Pure Wafer (PUR) has enjoyed a strong second half performance which helped produce a full year pre-tax profit of $3m, compared with a loss of $700,000 last year. Wafer sales rose by 21 per cent compared with last year with a strong sequential performance from the first half to the second reported. The group ended the year with net debt of $1.6m, down 87 per cent from last year.

Ceres Power (CWR) reported full year results with revenues down from £18.1m to £10.1m. The company has reduced operating costs by 44 per cent to £10.2m and had net cash of £15.4m at the end of June.

Related articles

• Wolseley earnings beat analysts’ estimates (irishtimes.com)
• Wolseley to return £300m to shareholders as profits jump (telegraph.co.uk)
• Notable Runners: People’s United Financial, Inc. (NASDAQ:PBCT), Ceres Inc (NASDAQ:CERE), BioCryst Pharmaceuticals, Inc. (NASDAQ:BCRX), Amyris Inc (NASDAQ:AMRS) (sbwire.com)
• Sales test for supermarket rivals (belfasttelegraph.co.uk)
• Nextmedia acquired by Forum Media Group (mumbrella.com.au)
• Market round-up: UBS bullish about Wolseley amid good vibes from builders in US (standard.co.uk)
• FTSE Shares That Soared and Plunged This Week (dailyfinance.com)
• Europe’s Stocks to Watch: Ahold, IMI, Wolseley (blogs.wsj.com)
• Wolseley Canada Becomes TOTO’s First National Distributor in Canada (sacbee.com)
• FTSE Shares That Soared and Plunged This Week (fool.com)

Ex-Factory Prices Drops

Tags

Africa, ghana, Inflation, Inflation rate, July, July 2012, July 2013, June, Manufacturing, Office for National Statistics, Percentage, Price

Reflex Eco Group – Ghana News

by Samuel Boadi (local journalist)

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

Ex-Factory prices reduced from 7 percent recorded in July 2012 to 5 percent in July 2013 year-on-year representing a decrease of 2.0 percentage points.

According to Government Statistician, Dr Philomena Nyarko, who officially launched the producer price index (PPI) for July 2013, the month-on-month change in producer prices between June 2013 and July 2013 was also -0.5 percent.

Dr. Nyarko said the producer price inflation in the Mining and Quarrying subsector decreased substantially by 11.7 percent.

She noted that producer price inflation for the manufacturing sector which constitutes more than two-thirds of total industry increased to 10.9 percent from a rate of 10.6 percent in June this year adding that the rate for the utilities sub-sector decreased marginally by 0.39 percentage points in July 2013.

She further said during the 12 months period from July last year to July this year, the highest year-on-year inflation for all industry was recorded in October with 19.1 percent whiles July 2013 recorded the lowest.

Dr. Nyarko indicated that between July and November 2012, the producer price inflation fluctuated until December 2012.

She however said that from December 2012 to February 2013, the rate declined to 9.1 percent but increased steadily to record 10.6 percent in March this year and subsequently declined consistently to record 5.0 percent in July 2013.

“During the month of July 2013, eight out of the 16 major groups in the manufacturing subsector recorded inflation rates higher that the sector average of 10.9 percent”, she said adding that the manufacture of furniture; manufacturing recorded the highest inflation rate of 32.2 percent while producer prices in the manufacture of electrical machinery and apparatus recorded the lowest inflation rate of -5.6 percent over the one year period.

Commenting on the petroleum sector, she said between July 2012 and December 2012, the inflation rate in the petroleum sub-sector remained relatively stable adding that it however dropped in January 2013 and subsequently rose in March 2013.

“The rate remained unchanged in April 2013 but thereafter increased steadily to record 19.3 percent in Jun2013. In July this year the rate declined to 18.5 percent due to slight declines in the prices of marine gas oil and aviation fuel.

“The afore-mentioned figures for the month of July 2013 are provisional and are subject to revision when additional data become available.”

Related articles

• Inflation climbs to four-year high (iol.co.za)
• UK inflation rate eases to 2.7 percent (jsonline.com)
• London rent soars to average of £1,100 (standard.co.uk)
• UK Inflation Rate Eases to 2.7 Percent (abcnews.go.com)
• Inflation rate drops to 4-year low of 2.1% (manilastandardtoday.com)
• Reform to cut value of annual pension by 1,500 euros in five years (elpais.com)
• UK inflation rate eases to 2.7 percent (fresnobee.com)
• Inflation rates continue climb in August (dailynewsegypt.com)
• Inflation, rupee may force RBI to keep rates on hold (dnaindia.com)
• UK inflation rate eases to 2.7 percent (boston.com)

Investment News: Gulf Keystone, Asos, Exillon, IQE, Quindell Portfolio & more

Tags

Brazil, Canada, Equities, Gulf Keystone Petroleum, ingenie, June, Kurdistan, London, Makro, Petroleum industry, Premier Farnell, Quindell, Simon Thompson, United Utilities

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

Today’s market overview

Equities in London have flown out of the blocks this morning after the Federal Reserve surprised everyone last night by holding off on tapering its QE3 monetary easing programme. The Trader Dominic Picarda is pleased with the news, but isawaiting a little pull back now before piling in.

IC TIP UPDATES:

Half year results from Gulf Keystone Petroleum (GKP) showed losses reducing to $26.4m as the company enters ramp up phase in production from its giant Shaikan discovery in Kurdistan. The first production facility at Shaikan PF-1 is producing 12,400 barrels of oil per day (bopd) as it builds up to its capacity of 20,000 bopd and a second 20,000 bopd production facility should be in operation by the end of the year. Meanwhile drilling is ongoing on other areas of the discovery and the field development plan has been approved. We keep our buy recommendation.

Sell recommendation. Asos (ASC) has confounded expectations with another stellar performance in the past three months which means full year profits are likely to beat expectations. The three months to August saw UK retail sales rise by 49 per cent and international sales up by 47 per cent. Total group revenues for the year were up by 39 per cent. Our recommendation is under review.

Russian oil company Exillon (EXI) has formally initiated a strategic review which is likely to lead to the sale of the company. Following interest in buying the company from founding shareholder Maksat Arip, confirmed in late July, the company has since received further expressions of interest and is now in a ‘formal sales process’. We will review our recommendation in a tip update.

Simon Thompson recommendation. IQE (IQE) has issued strong half year results showing revenues up 84 per cent and cash earnings up 162 per cent at £10.5m, boosted by acquisitions. The company admits that its wireless device end markets were hit recently by uncertainty ahead of the release of the latest wave of smart phones but are expected to pick up sharply again now.

Fellow Simon Thompson tip. Global Energy Development (GED) increased its production by 16 per cent to 235,000 barrels during the six months to June but turnover fell marginally due to lower realised oil prices. The company remains focused on finding a farm out partner for its Magdalena interests in Colombia.

Booker (BOK) has reported another solid trading period for its core cash and carry business with like for like sales up 3.5 per cent in the 12 weeks to 13 September. The performance at the acquired Makro business is also showing signs of turning around. The company has opened two more branches in India, taking the total to six. Buy.

KEY STORIES:

United Utilities (UU.) says trading is in line with expectations for its first half, with revenues expected to be slightly higher than the same period last year after regulatory price increases which means underlying profits will be up ‘moderately’.

Insurance services specialist Quindell Portfolio (QPP) has made a further investment in telematics specialist ingenie and also taken 40 per cent stakes in two businesses it is spinning out in the UK and Canada. The company, which specialises in using telematics to set drivers’ insurance costs is looking to expand its offering to the over-25’s market. Simultaneously, Quindell announced a contract win in Canada for its telematics services.

OTHER COMPANY NEWS:

Animal feeds specialist Anpario (ANP) has enjoyed another strong half year as it benefits from expansion into the US, Brazil and China. Revenues rose by 20 per cent and adjusted earnings by 28 per cent.

Electronics supplier Premier Farnell (PFL) continues to suffer from subdued end markets, with revenues growing just 0.9 per cent in the first half although a margin improvement helped total profits rise by 19.8 per cent to £38.1m.

Related articles

• Gulf Keystone Wins Lawsuit Over Ex-Soldier’s Iraqi-Oil Claim (bloomberg.com)
• Russian oil producer Exillon to explore sale (worldbulletin.net)
• Gulf Keystone wins court battle over Kurdistan oilfields (theguardian.com)
• Gulf Keystone wins UK court case over Kurdistan oilfield ownership (uk.reuters.com)
• ingenie to Extend its Telematics Insurance Offering to Experienced Drivers and Launch in Canada (sys-con.com)
• Quindell profits double as contracts flow in (thetimes.co.uk)
• Hampshire firm set to create 100 new jobs (dailyecho.co.uk)
• Questor share tip: Quindell Portfolio still a buy despite naysayers (telegraph.co.uk)
• Should you join the rush into Aim shares? (telegraph.co.uk)
• UPDATE 2-Gulf Keystone wins Kurdistan oilfield ownership court case (uk.reuters.com)

Investment News: JD Sports, Smiths Group, Sirius Minerals, Global Energy Development & more

Tags

British Isles, Business, Carillion, economy, Federal Reserve, Federal Reserve System, JD Sports, July, June, KeyBank, M&C Saatchi, Nigeria, Real estate investment trust, Smiths Group, Trader Dominic Picarda, Unite Group, Universities Superannuation Scheme

Today’s market overview

Equities are flat in early trading as investors await the long anticipated announcement from the Federal Reserve on tapering of its QE3 programme, and The Trader Dominic Picarda is sitting on the sidelines until the dust settles.

IC TIP UPDATES:

Retailer JD Sports (JD.) turned in a solid performance during the six months to 3 August despite continued poor trading at its outdoor businesses Milletts and Blacks. The core sports fascias saw like for like sales rise by 7.5 per cent in the UK and Ireland and operating profits leapt by 55 per cent. The company has begun expanding its sports stores in Europe. The fashion fascias performed less well with like for like sales down 2.2 per cent and outdoor fared poorly too. The two outdoor brands have been separated with management dedicated to each and further costs taken out. If JD can turn around outdoor and fashion it has a seriously strong business on its hands, we keep our buy rating.

Smiths Industries (SMIN) has posted flat results for the year to July with revenues up just 2 per cent at £3.1bn and profits flat at £498m. Emerging markets sales rose by 14 per cent and now account for 16 per cent of the whole business. Smiths continues to refocus away from government contracts and has identified further cost savings to take out. Meanwhile investors can look forward to a 30p special dividend on top of the 39.5p full year payout. Buy.

Construction specialist Carillion (CLLN) has been awarded preferred bidder status on a Canadian highways contract worth more than £100m over 12 years. We maintain our buy recommendation.

Simon Thompson recommendation. Global Energy Development (GED) has updated investors on its development plan for the Bolivar contract area in Colombia, where it has identified a substantial shale oil resource. The drilling plan has been simplified and should yield more output when in place, but it has slightly delayed discussions with potential partners.

Fellow Simon Thompson recommendation. Town Centre Securities (TCSC) has produced results on a par with last year with underlying profits of £7.3m and a net asset value of 267p, which leaves the shares at a 23.4 per cent discount. Occupancy remains strong at 98 per cent and the group’s car parking business increased profits by 3.2 per cent.

Sirius Minerals (SXX) has attempted to shore up shareholder confidence after the recent delays to its planning application for its York potash project with a maiden resource estimate which indicates the potential size of the mine. The company has announced an ore reserve of 250m tonnes of polyhalite at an average grade of 87.8 per cent from just 1 per cent of the project area. This means a mine life of at least 50 years, possibly double that. Nonetheless until the permission is granted for the mine shares are likely to remain depressed.

Faroe Petroleum (FPM) announces that operator Statoil has spudded the Snilehorn exploration well in the Norwegian Sea. Faroe has a 7.5 per cent interest in the well. We keep our buy recommendation on Faroe.

London Metric Properties’ (LMP) joint venture with the Universities Superannuation Scheme, the Metric Income Plus Partnership, has acquired five Wickes retail warehouses for £28m. We maintain our buy rating.

KEY STORIES:

Interim results from M&C Saatchi (SAA) show a 5 per cent rise in revenues and a 13 per cent leap in underlying operating profits with revenues in the UK up by 8 per cent and like for likes in the Americas and Europe up by 24 per cent and 21 per cent respectively.

Housebuilder Redrow (RDW) is benefiting from the buoyant conditions the sector is enjoying and has posted a 26 per cent rise in revenues in the year to June which, with improving margins, helped produce a pre-tax profit uplift of 63 per cent to £70m. Management is confident enough to reinstate the dividend at 1p a share. Weekly reservations are now running 40 per cent ahead of last year.

OTHER COMPANY NEWS:

Eland Oil & Gas (ELA), which is trying to restart oil production on the OML40 licence area in Nigeria has reaffirmed that it expects first production to flow in October.

Unite Group (UTG) has agreed a deal with Schroder Real Estate Investment Trust to acquire a one acre site in Wembley for £7.4m on which it will build a student residence and office building through its London Student Accommodation Vehicle joint venture with a development value of £47m.

Half year results from Highland Gold Mining (HGM) showed a small increase in production to 105,630 ounces of gold and a similar increase in gold sales. The group has also reduced cash costs of production but lower realised gold prices hit profitability with net profits down from $48m to $17m.

Related articles

• Week ahead in business and economics: September 16-20 (telegraph.co.uk)
• Millets weighs on profits as JD Sports soars (standard.co.uk)
• Millets survival slows JD pace (belfasttelegraph.co.uk)
• UK retailers ready to show effects of good summer (thejournal.co.uk)
• Nike Air Max 95 – JD Sports Exclusives (complex.com)
• You can starve on benefits in this country | Jack Monroe (theguardian.com)
• Market round-up: Miner Randgold on the rise but Glencore Xstrata is in a hole (standard.co.uk)
• How to Play the Spike in Gold (dailyfinance.com)
• Sirius Minerals Drops on Potash Mine Planning Submission Delay – Bloomberg (bloomberg.com)
• Stocks to watch on Wednesday (news.theage.com.au)

Investment News: Gulf Keystone, Morrison, Thalassa Holding, Noble Investments Next, Ocado & more

Tags

Amec, Dalton Philips, Deutsche Bank, Gulf Keystone Petroleum, June, KENZ, Kier Group, Morrison, Ocado, Royal Mail, Sales, Simon Thompson, Stanley Gibbons, Trinity Mirror, Ultra Electronics

Today’s market overview

Equities are marginally ahead in early trading and The Trader Dominic Picarda is happy with his assertion that we are in the early stages of another rally.

IC TIP UPDATES:

Gulf Keystone Petroleum (GKP) has appointed Deutsche Bank to help push through its planned move to the main list by the end of this year.Buy.

Sell recommendation. Morrison (MRW) has issued flat figures for the first half with revenues flat at £8.9bn and like for like store sales down by 1.6 per cent. Underlying profits are down by 10 per cent.

Oil services company Amec (AMEC) has confirmed that it has no plans to bid for Kentz Corporaton (KENZ). We keep our buy on Amec.

The board of Simon Thompson recommendation. Noble Investments(NBL) has indicated its willingness to accept an indicative offer of 255p a share in cash and paper from Stanley Gibbons (SGI) should the approach be firmed up. Stanley Gibbons will have to raise £37m from shareholders towards the deal.

Another Simon Thompson recommendation, Thalassa Holdings (THAL), has said that strong trading means full year results will ‘significantly exceed’ expectations.

A third Simon Thompson recommendation, 32Red (TTR), has issued strong result for the six months to June showing a 15 per cent rise in revenues and 12 per cent improvement in profits.

Full year results from Kier Group (KIE) reflect tough end markets with underlying pre-tax profits slipping from £70m to £63.4m. Looking ahead all of the construction division and 95 per cent of the services division order books are already secured for 2014. Buy.

Document storage specialist Restore (RST) has benefited from acquisitions with half year results showing a 35 per cent surge in revenues and a near doubling of adjusted pre-tax profits to £4.1m. We maintain our buy recommendation.

KEY STORIES:

The government has confirmed its plans to seek an initial public offering for the Royal Mail. The exact details are not yet known but employees will receive 10 per cent of the company and priority in the public element of the float. Investors will be able to buy shares through intermediaries or direct through a postal system.

Online grocer Ocado (OCDO) has posted a 16.4 per cent rise in gross sales and a 15.3 per cent increase in orders per week but the size of the average order has remained static at £113.54, up just 1 per cent. The company has completed the sale and leaseback of its second fulfilment warehouse to Morrison (MRW) which has helped to tidy up its balance sheet.

Retailer Next (NXT) has issued a strong set of results for the six months to July with operating profits coming in towards the top end of expectations, up by 7.2 per cent, as the company managed to sell more product at full price than the previous year. Overall sales rose by 2.2 per cent, primarily down to new store space, it added 145,000 square foot in the period, and continued strength in performance at the Directory business. The high street retail business actually posted a marginal reduction in sales, down 0.9 per cent to £1bn.

Continuing the retail theme, Home Retail (HOME) enjoyed a stronger performance in the second quarter of its financial year as its self help initiative at Argos kicked in and the improved weather gave Homebase a significant boost. At the half year stage, Argos like for like sales were up 2.3 per cent and Homebase sales up 5.9 per cent, boosted by a standout 11 per cent improvement in like for like sales at the DIY chain in the second quarter. Both chains actually reduced their sales space marginally during the year as management rationalise their store base.

Finally on the retail front, homewares specialist Dunelm (DNLM) continues to grow strongly having added another 14 stores in the year to June, increasing its portfolio to 126 with another 10 openings contracted for this year. Overall annual sales rose by 12 per cent to £677.2m and pre-tax profits rose by the same margin to £108.1m.

OTHER COMPANY NEWS:

Trinity Mirror (TNI) has confirmed that police are at an early stage in establishing whether Mirror Group Newspapers should face criminal charges in relation to phone hacking at the Sunday Mirror.

Ultra Electronics (ULE) has won a £6.3m contract for power distribution systems on the UK’s Warrior armoured vehicles.

Related articles

• UPDATE 2-Gulf Keystone wins Kurdistan oilfield ownership court case (uk.reuters.com)
• GKP to Suspend Shares Pending Verdict (iraq-businessnews.com)
• Morrisons pledges to fightback despite fall in sales (telegraph.co.uk)
• GKP Surges on Court Ruling (iraq-businessnews.com)
• Morrisons half year profits fall (metro.co.uk)
• Oil Pipeline From Kurdistan Makes Gulf Keystone Target: Energy – Bloomberg (bloomberg.com)
• Morrisons half-year profits fall (bbc.co.uk)
• Online food shopping to increase as families get fed up trudging the aisles at the supermarket (dailymail.co.uk)
• Ocado and Morrisons clash over online sales tax proposals (dailymail.co.uk)
• Morrisons struggles as profits and sales slide (standard.co.uk)

Investment News: Ithaca Energy, Thorntons, Tesco & more

Tags

August, Azerbaijan, Barratt Developments, Business, Eastern Europe, Fresh Easy, Ithaca Energy, June, Revenue, Ron Burkle, Ronald Burkle, Sport Direct, Tesco, Thorntons, Trader Dominic Picarda, United States, Yucaipa, Yucaipa California

Today’s market overview

Equities have started the day flat, but The Trader Dominic Picarda views the price moves of the past couple of sessions as confirmation that the bulls are back in charge.

IC TIP UPDATES:

Ithaca Energy (IAE) has issued a positive flow test result from the first Stella field development well which flowed 10,835 barrels of oil per day and was only limited by the capacity of the equipment available. Undersea infrastructure work is also progressing well and the drilling equipment will now move to the second development well. We maintain our buy recommendation.

Sell recommendation. Kingfisher (KGF) continues to struggle in tough end markets for the DIY retailer. The 26 weeks to 3 August saw total sales edge ahead by 1.5 per cent in constant currency terms but like for like sales dipped by 0.8 per cent. Adjusted pre-tax profits dipped by 1.6 per cent but reported profits were up by 10.2 per cent. During the period the company has acquired 15 stores in Romania and opened a net 29 new stores across the UK, France, Poland, Spain and Turkey.

Simon Thompson recommendation. Thorntons (THT) has posted pre-exceptional profits of £5.6m, up from £900,000 last year, from just a 1.8 per cent uplift in revenues as management continues its turnaround plan. Management has closed 35 stores and will close more this year as the refocus on the fast moving consumer goods segment continues.

Location intelligence technology specialist Ubisense (UBI) grew revenues by 3.6 per cent to £12.4m in the six months to June with recurring revenues up to 26.8 per cent of the total. The company’s order book is up 38 per cent to £14.1m with a further order announced today to deploy its Smart Factory system with an existing European automotive manufacturer for a factory in Eastern Europe. We maintain our buy rating.

Alkane Energy (ALK) more than doubled revenues in the six months to June as it increased its coal bed methane output capacity and its standby power offering to an installed capacity of 81MW by the period end. Cash profits rose by 54 per cent to £3.3m. We keep our buy recommendation.

KEY STORIES:

Tesco (TSCO) has finally announced its exit from the US grocery market after sealing a deal which will see the retail giant pay a loan of £80m to the buyer, Yucaipa Group of Companies, as well as incur further costs for the closure of non-core stores. Yucaipa, owned by US billionaire Ron Burkle, will take on the Fresh & Easy business as a stand alone chain. Tesco will receive warrants which, dependent on success of the business, could see it end up with a 32.5 per cent share of the business.

The continued acceleration of the housing market is reflected in full year results from Barratt Developments (BDEV) which showed revenues up 12.2 per cent in the year to June and pre-tax profits before exceptionals up 73.7 per cent to £192.3m. Since the period end this performance has accelerated with a 29.4 per cent rise in net reservations per week and a 44.4 per cent increase in forward sales to £880.4m.

Fellow housebuilder Redrow (RDW) has announced a new, increased four year banking facility worth £250m as it looks to increase its output.

Retailer Sports Direct (SPD) continues its dominant performance of the sporting sector on the high street posting an 18.2 per cent rise in group sales for the 13 weeks to 28 July and a 23.2 per cent uplift in gross profit.

African Barrick Gold (ABG) has announced the abrupt departure of its chief operating officer Marco Zolezzi.

OTHER COMPANY NEWS:

Advanced Medical Solutions (AMS) grew revenues by 11 per cent to £27.4m and profits by 33 per cent to £6m in the six months to June.

Anglo Asian Mining (AAZ) enjoyed its best month of gold production at the Gedabek mine in Azerbaijan on record in August after the recently completed Agitation Leaching Plant helped push production to 7,600 ounces. An updated resource estimate for Gedabek is expected before the end of this month. Meanwhile, progress is being made at Gosha, 50km away from Gedabek, where the first trial batch of ore has been mined.

Related articles

• Ithaca Energy Inc – Norvarg Appraisal Well Results (sys-con.com)
• Tesco to Sell Fresh & Easy to Burkle’s Yucaipa in US Exit – Bloomberg (bloomberg.com)
• Tesco pays out to rid itself of US chain Fresh & Easy (theguardian.com)
• Tesco will sell bulk of US operations (bigpondnews.com)
• Tesco agrees to sell bulk of US unit Fresh & Easy (valuewalk.com)
• Fresh & Easy supermarket chain sold to U.S. investment group (rawstory.com)
• Tesco sells US chain Fresh & Easy (bbc.co.uk)
• How Tesco came to dominate (bbc.co.uk)
• Private investment firm to buy Fresh & Easy (kget.com)
• Tesco offloads loss making Fresh & Easy chain (arunbabyveranakunnel.wordpress.com)

Investment News: Gulf Keystone Petroleum, Whitbread, Netplay TV & more

Tags

Abcam, Avanti Communications, AVN, Costa Coffee, Egypt, Equities, GKP, Gulf Keystone Petroleum, Hylas 2, June, Kazakhstan, KeyBank, London, London Stock Exchange, New York, Whitbread

Today’s market overview

Equities in London have followed the positive lead set by New York and Asia overnight with a strong start this morning and The Trader Dominic Picarda sees this as confirmation that the bulls are back in town.

IC TIP UPDATES:

Shares in Gulf Keystone Petroleum (GKP) have been suspended this morning at the request of the company as it prepares for the result of the legal action taken against the company by Excalibur Ventures to be announced later this morning. The shares should be relisted later today. We maintain our buy recommendation for now.

Rolls Royce (RR.) has won a $175m contract to supply equipment to the Kazakhstan section of the Central Asia – China gas pipeline. Buy.

Sell recommendation. Whitbread (WTB) has continued to deliver solid sales growth. In the 24 weeks to 15 August like for like sales rose by 2.6 per cent and total sales by 12.4 per cent. The performance is primarily powered by continued strong growth from the Costa Coffee brand but there are signs of growth slowing a little.

Simon Thompson recommendation. Netplay TV (NPT) has issued strong interim results showing turnover rising 36 per cent and profits up by 47 per cent. The third quarter has also seen a 17 per cent increase in average daily net revenues. Netplay is benefiting from more penetration into the tablet and mobile markets which now account for 28 per cent of net revenue, against 10 per cent last year, and one third of new depositing players.

Interior Services Group (ISG) managed to grow profits and margins in the year to June despite continued difficult end market conditions. Revenues were flat at £1.28bn but underlying profits rose by 14 per cent to £8.5m. The order book ended the year 12 per cent ahead of the previous year at £854m. Buy.

Protein research tools supplier Abcam (ABC) posted a 25 per cent rise in revenues for the year to June which prompted a 20.6 per cent increase in adjusted operating profits to £46.5m and a 17 per cent increase in the full year dividend. Our recommendation is under review.

Meat packer Hilton Food Group (HFG) grew revenues by 9.4 per cent in the first half of the year but post tax profits rose by just 4 per cent, held back by higher input prices and the costs of setting up a joint venture in Australia. We keep our buy rating.

KEY STORIES:

Consumer debt specialist Arrow Global has announced its intention to float on the main list of the London Stock Exchange. The company, which buys up distressed consumer debt from banks and sets about improving collection rates, is expected to be valued around the £400m mark when it floats.

Fenner (FENR) says results for the year to end August are likely to be in line with expectations and that management expects a return to growth next year.

Satellite business Avanti Communications (AVN) grew its revenues by 65 per cent to £20.6m in the year to June and with the Hylas 2 satellite now launched and coverage expanded to 50 countries management expects a similar growth trajectory this year. It has a backlog of £290m, of which £42m is expected to convert to revenues this year.

Healthcare revenues systems specialist Craneware (CRW) survived a tough year in its core US market with revenues coming in flat and profits edging ahead by 4 per cent to $11.2m. The company also reported ending the year with a stronger sales run rate that it began with.

OTHER COMPANY NEWS:

Circle Oil (COP) reports that its latest well, AASE-18, in Egypt has proved successful and is now producing oil. Current gross daily production is running at 11,234 barrels of oil per day with gas production equivalent to 2,282 barrels as well.

Related articles

• Gulf Keystone Petroleum jumps ahead of key court judgement (theguardian.com)
• GKP Rises on Takeover Rumours (iraq-businessnews.com)
• Thorntons rises on activist investor stake (telegraph.co.uk)
• Oil Pipeline From Kurdistan Makes Gulf Keystone Target: Energy – Bloomberg (bloomberg.com)
• SMALL CAP SHARE TIPS: Investors rush to snap up penny share pin-up Gulf Keystone Petroleum (thisismoney.co.uk)
• SMALL CAP SHARE TIPS: Investors rush to snap up penny share pin-up Gulf Keystone Petroleum (dailymail.co.uk)
• GKP to Suspend Shares Pending Verdict (iraq-businessnews.com)
• Gulf Keystone’s boardroom capitulation | Nils Pratley (guardian.co.uk)
• Oil shipments by rail, truck, and barge up substantially (canadafreepress.com)
• Keystone XL ‘no longer a necessity’ for Canadian producers: analyst (business.financialpost.com)