BOV and HSBC move in opposite direction

The share price of Bank of Valletta plc initially traded up to €2.14 where a total of 100,000 shares traded. However, lack of support for the equity at this level forced the price to drop to €2.10 representing a decline of 0.9% from yesterday’s close. A total of 133,813 BOV shares changed hands today across seventeen trades. BOV is scheduled to announce its interim results next Friday 27 April.

On the other hand, HSBC Bank Malta plc reversed yesterday’s 0.8% drop with an equivalent increase during today’s session to regain the €2.52 level across two trades amounting to 28,900 shares. The Bank is scheduled to pay the final gross dividend of €0.072 per share also on Friday.

The only other active equity was International Hotel Investments plc. The equity held on to yesterday’s strong gains as a further 8,000 shares changed hands at the €0.82 level. Earlier this week, IHI announced that it will be inviting a number of potential investors consisting primarily of sovereign funds and other institutions, to participate in the subscription of new shares through a private placement.

Meanwhile, shortly after the close of today’s trading session, Simonds Farsons Cisk plc published its preliminary statement of results covering the twelve months ended 31 January 2012. The financial statements show a 6% rise in revenue to a record €70.85 million mainly due to an increase in the export segment. However, operating profit only increased by 1.5% to just below €6.4 million as profit margins declined due to increased competition as well as rising costs of raw materials. On the other hand, profit for the year jumped by 25% to €4.7 million due to the non-recurrence of a write-off in relation to a terminated property lease incurred during the financial year ended 31 January 2011. Given the improved profitability the Directors proposed a final net dividend of €0.0567 (up 6.3% from the previous year’s final dividend) to all shareholders as at close of trading on 17 May. Combined with the net interim dividend of €0.1333 per share paid on 21 October 2011, the total net dividend in respect of the financial year ended 31 January 2012 amounts to €0.07 per share representing a 4% net dividend yield at the current price of €1.77 per share.

On the bond market, the Rizzo Farrugia MGS Index eased marginally lower to 986.162 points as Eurozone yields recovered to the 1.72% level following low demand for this morning’s 30-year and 10-year German bond auctions. On the secondary market, high volumes were registered in some local government paper with over €3 million (nominal) exchanged in the 6.35% MGS 2013 (II) and over €2 million (nominal) traded in the 4.8% MGS 2016 (II).