In light of the current global coronavirus spread, the MSE Equity Total Return Index dropped by a substantial 7.539 per cent, reaching close to a 16-month low of 8,630.297 points. A total of 23 issues were active, of which one advanced while another 18 lost ground. This week’s session saw a high level of trading, as a total weekly turnover of over €3.45 million was generated across 395 transactions.
On Monday, Malta International Airport plc (MIA) announced its traffic results for February 2020. Passenger movements amounted to 421,567, equivalent to a 17.3 per cent growth from the same month last year. The main drivers for the month’s traffic were the UK, Italy, Germany, France and Spain among others, apart from Germany which declined by five per cent. Despite February’s overall traffic result being a positive one, however, Seat Load Factors (SLF), particularly on Italian routes, saw a significant decline during the last week of the month due to the Covid-19 outbreak in Europe, and declining travel demand.
The airport’s CEO claimed the virus will bring with it challenging months, as passenger demand for air travel plummets. The equity reached its lowest level since July 2018 of €5.05, translating into a 16.53 per cent decline over the week. This was the result of 223,643 shares spread over 152 transactions, registering the largest weekly turnover of €1.18 million.
The banking industry was also negatively impacted. On Tuesday, FIMBank plc approved the consolidated audited financial statements for the financial year ended December 31, 2019. These shall be submitted for approval by the shareholders at the forthcoming Annual General Meeting (AGM), which shall be held on May 7, 2020. During the AGM, the board will not be recommending a dividend.
The group’s net operating results declined by 32.5 per cent to $14.3 million, upon the implementation of a de-risking process. Net operating income also dropped by 13 per cent as it stood at $51.3 million. Revenues decreased due to economic conditions. This led the group to de-risk its main portfolio due to a number of non-performing loans identified in prior years, resulting into a drop in income generated from these portfolios. The group improved its funding structure to offset the drop in revenues through various asset and liability measures. As a result, net interest income increased by almost 3.5 per cent to $32.3 million.
The equity price reached $0.63 on Tuesday but declined to $0.50 on Friday. Eight deals involving 86,675 shares resulted into a 13.79 per cent decline in price.
Bank of Valletta plc was down by 2.86 per cent as it closed the week at €1.02. This was the outcome of 46 deals involving 296,716 shares. The Board is scheduled to meet on March 18, to consider and approve the audited financial statements for the year ended December 31, 2019. HSBC Bank Malta plc lost 5.66 per cent as it reached a multi-year low of €1.00. A total of 844,779 shares changed hands over 39 transactions. Similarly, three deals involving 3,213 Lombard Bank Malta plc shares dragged the price 3.60 per cent lower to €2.14.
On Thursday, Malita Investments plc approved the financial statements for the year ended December 31, 2019. These shall be submitted for the approval of the shareholders at the next AGM. The board agreed to recommend a final gross dividend of €0.0350 per share, translating into a final net dividend of €0.02711 per share.
The company has a low working capital ratio, in line with the previous year at 0.1:1. In 2019, the company had a positive bank balance versus an overdrawn bank balance in the previous year. This was due to the short-term financing for the affordable housing project which increased the total current liabilities for 2019. Capital expenditure for the aforementioned project continued in 2019.
Profit before tax increased considerably from €13.7million registered in 2018 to €41.3 million as at December 31, 2019. Similarly, earnings per share were up to 25.08 from 7.88. Revenue was also up by almost 0.7 per cent to €8.07- million from the previous year’s figure. The equity was active on Thursday as four deals involving 40,000 shares were executed but closed unchanged at €0.90.
On a similar note, Santumas Shareholdings plc traded once on slim volume, which left price unaltered at €1.50. MIDI plc was active over six transactions as 26,300 shares changed hands. As a result, price was down to €0.40, translating into a 16.67 per cent fall in price. Eight deals involving 64,989 Malta Properties Company plc shares dragged the price 1.64 per cent lower to €0.60. Trident Estates plc lost ground as 12 deals involving 33,700 shares were executed. The equity closed 1.27 per cent lower at €1.55. Similarly, Tigne’ Mall plc traded twice over 7,899 shares, to close 2.27 per cent in the red at €0.86. Plaza Centres plc reached €0.98 on Friday, translating into a weekly drop of 5.77 per cent. This was the outcome of seven deals involving 30,500 shares.
Three deals involving 10,457 Main Street Complex plc shares resulted into an 8.77 per cent fall in price. The equity ended the week at €0.52.
On Thursday, International Hotel Investments plc announced its precautionary measures with respect to the evolving Covid-19 to reassure its shareholders. The company addressed a series of first-wave cost cutting and cost containment measures. The equity registered a considerable decline of 16.67 per cent as it closed at €0.625. This was the result of 130,786 shares spread over 22 transactions.
On Thursday, GO plc approved the preliminary statements of annual results for the financial year ended December 31, 2019. During the AGM, which shall be held on June 2, 2020, a final net dividend of €0.14 per share will be recommended. This payment sums up to a total net dividend of €14.18 million, which will be paid on June 4, 2020 to all shareholders on the register as at April 30, 2020. The company registered a 3.5 per cent increase in revenue from 2018, as it stood close to €177.8 million. Higher costs were incurred to provide a better service, which resulted into a decline in operating profits of 21.8 per cent to €25.8 million.
Group earnings before interest, tax, depreciation and amortisation (EBITDA) was up by 5.3 per cent to €73.2 million from the previous year. At company level, the adjusted EBITDA would amount to €43.5 million, translating into a 7.3 per cent decline. This downward trend is expected to be reversed in the near future as the company reaps the benefit of the investment in the sports package. The equity closed 1.41 per cent lower at €4.20, as seven deals involving 9,240 shares were executed.
On Thursday, its subsidiary, BMIT Technologies plc, announced its annual report and financial statements for the financial year ended December 31, 2019. These shall be submitted for shareholders’ approval at the forthcoming AGM on June 1, 2020. BMIT Technologies Group registered a positive performance in 2019 as revenues were up by 4.8 per cent from 2018 to €22.4 million. Profit before tax amounted to €7.2 million. Current assets amounted to €8.5 million versus €3.2 million recorded in the previous year. The equity closed 3.64 per cent lower at €0.53, as 155,600 shares changed ownership over 16 transactions. RS2 Software plc dropped by 7.87 per cent to €2.34. This was the result of 15 deals involving 51,528 shares.
On Thursday, Mapfre Middlesea plc announced the approval of the audited financial statements for the financial year ended December 31, 2019. These are to be submitted for approval of the shareholders at the next AGM, which shall be held on April 24, 2020. The company’s profit before tax more than doubled to €23.82 from the previous year’s figure. The equity was active on 17 deals of 33,157 shares and closed unchanged at €2.32.
Medserv plc was active on Thursday on a couple of deals of 6,000 shares but did not register any movement in price, as it closed at €1.00. A sole deal of 2,500 GlobalCapital plc shares pushed the price 6.48 per cent higher to €0.23. The equity was the only positive performer for the week. Two deals involving 4,480 MaltaPost plc shares dragged the price 6.92 per cent lower to €1.21.
PG plc traded 17 times over a mix of 222,900 shares. The equity lost 2.56 per cent as it closed at €1.90. Similarly, Simonds Farsons Cisk plc was down by 9.09 per cent to €10, as five deals involving 2,025 shares were executed.
In the Corporate Bond market, 47 issues were active, of which eight headed north while another 31 closed in the opposite direction. In the Prospects MTF market, 15 issues were active of which two registered gains while the rest closed unchanged. In the Sovereign Debt market, out of 18 active issues, three advanced while another 15 lost ground.
This article, which was compiled by 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 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 Limited at 67, Level 3, South Street, Valletta, on 2122 4410, or e-mail info@jesmondmizzi.com.