Daily Market Highlights (28.07.2022)
APS & BOV show strong underlying performance
The MSE Equity Price Index eased by 0.17% to 3,672.008 points as the declines in BOV and MaltaPost offset the gains in IHI, MIA and Plaza. Meanwhile, APS closed the day unchanged as overall trading in equities amounted to just under €0.1 million. Download today’s Equity Market Summary.
APS Bank plc held on to the €0.66 level on activity totalling 14,345 shares. Today APS published its interim results covering the six-month period ended 30 June 2022. The Bank reported a net loss of €0.5 million reflecting the adverse movements in the value of financial assets. On the other hand, on a standalone basis, APS generated a net profit of €9.27 million on the back of the strong growth in lending activity and non-interest income. The Bank is recommending an interim net dividend of €1.8 million through the issue of new shares. Subject to any regulatory approvals required, an Extraordinary General Meeting will be convened after the summer period to approve the issuance of new shares in satisfaction of the interim dividend.
Bank of Valletta plc dropped by 5.4% to the €0.875 level on a total of 54,868 shares. Today, BOV also published its interim results as it reported a net loss of €51.1 million reflecting the impact of the Deiulemar litigation settlement charge. Excluding this extraordinary line item, BOV posted a profit before tax of €26.1 million on the back of a marked increase in lending activity as well as higher non-interest income. The Bank noted that its decision not to declare an interim dividend takes into account the net loss reported for the period and the need to remain aligned with regulatory expectations.
MaltaPost plc slid by 2.8% to the €1.06 level on two deals totalling 3,000 shares.
In contrast, International Hotel Investments plc advanced by 4.2% to the €0.74 level on a single deal of 8,114 shares.
Also among the large companies by market value, Malta International Airport plc moved 0.8% higher to recapture the €6.00 level on 3,140 shares. Yesterday, MIA published its interim results showing a marked improvement in performance with revenues amounting to €37.3 million and an EBITDA of €23.3 million. Moreover, MIA reported a net profit of €10.7 million compared to the loss of €2.69 million posted in the first half of 2021. The airport operator added that given the strong recovery in air travel, it expects total passenger movements this year to exceed 5.4 million (which would be superior to the total traffic handled in 2016). Moreover, this level of traffic would result in revenues of over €82 million, an EBITDA of over €50 million, and a net profit of over €23 million.
Plaza Centres plc extended yesterday’s gain as it advanced by a further 2.5% to the €0.82 level on volumes totalling 5,000 shares. Shareholders as at close of trading on Wednesday 3 August will receive a net interim dividend of €0.0098 per share which is payable on Friday 19 August.
Today, Mapfre Middlesea plc published its interim results showing a 5% increase in net profits to €5.18 million. Total income from insurance activities eased slightly to €12.1 million. However, the company’s financial performance was favourably impacted by a €0.54 million reversal of impairment as well as lower operating expenses which contracted by nearly 30% to €1.39 million. Looking ahead, Mapfre Middlesea explained that it looks at H2 2022 with cautious optimism in an environment wary of the evolving conflict in Ukraine, inflation, and a challenging investment backdrop. The company will remain focused on its strategic actions to deliver improved returns and efficiencies.
The RF MGS Index snapped a four-day positive streak as it dropped by 0.16% to 948.760 points. Yesterday, the US Federal Reserve raised its funds rate by 75 basis points for the second consecutive month in line with market expectations. In his address to the media, Chairman Jerome Powell explained that the central bank remains committed to tame inflation through further rate increases, albeit the pace of increases may slow depending on how monetary policy tightening will continue to affect the economy and inflation. Meanwhile, Mr Powell dismissed claims that the US was in a recession because the labour market remained robust. Nonetheless, he recognised that the current economic conditions are challenging and a recession is not unavoidable. Indeed, data published today showed that the US entered into a technical recession as GDP eased by 0.9% during Q2 2022 following the 1.6% contraction recorded in Q1 2022.
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.