Lombard climbs to six-week high

The MSE Equity Price Index shed a further 0.27% to a fresh two-month low of 3,695.291 points as the gains in Lombard and Plaza was outweighed by declines in four other equities. A further four equities closed unchanged as overall trading activity in equities improved to the highest level in four weeks of €0.37 million. Download today’s Equity Market Summary.

Lombard Bank Malta plc continued to attract relatively high trading activity as it advanced by 9.1% to a six-week high of €0.90 across volumes totalling 145,407 shares. On Monday, Lombard announced that it submitted an application to the Malta Financial Services Authority requesting approval of a prospectus in relation to a 2-for-3 rights issue of new ordinary shares, which shall form part of the same class and have equal rights to existing shares. The Rights Issue will first be offered to shareholders as at the close of trading on Friday 15 September 2023. The announcement also noted that the rights issue price has been set at €0.75 per new ordinary share. This represents a discount of around 20% to the trade-weighted average price of the bank’s shares over the last six months of €0.93. It also represents a discount of over 50% to the net asset value of €1.51 per share as at 30 June 2023. Lombard explained that the rights issue will allow for further strengthening of its capital base both for regulatory purposes as well as for the implementation of the bank’s strategy for growth. Lombard noted that this is expected to result in increased profits and, subject to business requirements and regulatory approval, dividend distributions of circa one third of annual profits.

Plaza Centres plc climbed 4% to the €0.65 level on a single trade of 2,201 shares.

GO plc was today’s most actively traded equity as it eased by 0.7% to a six-week low of €2.90 across activity totalling 53,000 shares having a market value of €0.15 million.

GO’s data centre and IT services subsidiary BMIT Technologies plc fell by 3.4% back to the €0.40 level on one deal of 12,500 shares.

Malta International Airport plc erased yesterday’s gains as it retracted by 1.8% to the €5.60 level across five trades totalling 3,875 shares.

Bank of Valletta plc shed 0.8% to the €1.25 level on two deals totalling 12,000 shares.

Elsewhere, Trident Estates plc held the €1.25 level on a single trade of 4,685 shares. Yesterday, Trident published its interim financial results covering the six-month period ended 31 July 2023. Trident registered record revenues (at interim stage) of €1.78 million (H1 2022/23: 0.89 million) reflecting the higher occupancy levels at Trident Park. On the expenditure side, total operating costs increased to €0.93 million compared to €0.55 million in the same period last year as a result of increased activity within the Trident Park property. Meanwhile, finance costs surged to €0.75 million compared to €0.09 million in the first half of 2022/23. The board explained that following the commencement of Trident Park operation, the Group no longer capitalises its interest costs. Nonetheless, the Directors noted that finance costs were significantly impacted by the steep increase in the 3-month EURIBOR rate. The net profit for the period amounted to €0.07 million compared to €0.15 million in the same period last year. Shareholders’ funds remained virtually unchanged at €59.8 million, which translates into a net asset value per share of €1.424.

Two deals totalling 10,000 shares left the share price of PG plc at the €2.00 level.

APS Bank plc (4,659 shares) and Simonds Farsons Cisk plc (1,648 shares) traded flat at the €0.60 and €6.70 levels respectively.

The RF MGS Index remained virtually unchanged at 864.682 points. Today, the ECB raised its interest rates by a further 25 basis points, with the deposit facility reaching an all-time high of 4.00%. In its monetary policy statement, the ECB noted that the latest projections indicate that inflation within the eurozone will average 5.6% in 2023, 3.2% in 2024 and 2.1% in 2025. This is an upward revision for 2023 and 2024 but a downward revision to 2025. With respect to economic growth, the ECB expects activity to remain subdued, including some weakening within the services sector which so far had been resilient. In the concluding remarks, the ECB noted that interest rates will be set at sufficiently restrictive levels for as long as necessary.

This report contains public information only and is not to be construed as investment advice or an offer to buy or sell any securities. Information contained herein is based on data obtained from sources considered to be reliable, but no representations or guarantees are made with regard to the accuracy of the data. Stock markets are volatile and subject to fluctuations which cannot be reasonably foreseen. Past performance is not necessarily indicative of future results. Rizzo, Farrugia & Co. (Stockbrokers) Limited is a company licensed to undertake investment services in Malta by the MFSA under the Investment Services Act, Cap. 370 of the Laws of Malta and a member of the Malta Stock Exchange.