BOV increases profits despite drop in net interest income

The MSE Equity Price Index fell by 0.82% to a fresh two-month low of 3,831.705 points driven by the declines in BOV and MIA. Meanwhile, three equities closed unchanged as today’s trading activity totalled €0.11 million. Download today’s Equity Market Summary.

Bank of Valletta plc shed 2.5% to a two-month low of €1.93 across eighteen deals totalling 25,019 shares. Today, BOV issued a quarterly financial overview providing information about its performance in Q1 2025 when compared to the same period in 2024. Net interest income dropped by 5.9% to €92.5 million (Q1 2024: €98.3 million) as the 5.7% reduction in gross interest income to €105.8 million outweighed the 3.9% reduction in interest expenses to €13.3 million. Meanwhile, BOV’s non-interest income surged by 33.5% to €25.6 million (Q1 2024: €19.1 million) driven by the improvement in net fee and commission income and trading profits. Furthermore, BOV’s financial performance was impacted by net impairment charges of €0.17 million, which are lower than the €6.6 million recognised in the first quarter of 2024. Overall, BOV recorded a profit before tax of €67.1 million, which is 5.3% higher than the €63.7 million in the first three months of 2024. The net profit for the period amounted to €44.3 million which translates into an annualised return on average equity of 12.4% (Q1 2024: 13.1%0. Total equity increased by 3.1% (or €44 million) to €1.45 billion, which translates into a net asset value per share of €2.487. BOV also announced that the Board resolved to issue a second series of bonds under its existing Unsecured Euro Medium Term Bond Programme, which will consist of an offer of €100 million, with an over-allotment option of another €50 million. The publication of the final terms will be made available in due course.

Malta International Airport plc fell by 1.7% to the €5.95 level across eleven deals totalling 9,960 shares.

Meanwhile, HSBC Bank Malta plc held the €1.44 level over trivial volumes. Today, HSBC Bank Malta plc published a quarterly update providing information about its performance in Q1 2025 when compared to the same period in 2024. Total revenue decreased by 10% (or €6.7 million) reflecting the lower prevailing average interest rates in Q1 2025 when compared to Q1 2024. The Directors highlighted that the Bank reported growth across all other income lines, including net fee income, foreign exchange, and insurance income. The financial performance was also dented by expected credit losses (ECL) of €0.6 million compared to a release of €1.8 million in Q1 2024. The net ECL charge in Q1 2025 reflected the increased global uncertainty and geo-political risks. Nonetheless, the Directors remain confident in Malta’s resilience, diversified economy and economic strength. HSBC noted that costs increased by 8% (or €2.3 million) driven by higher salaries and employee benefits as well as higher technology spend. Overall, HSBC reported a profit before tax of €27.9 million, which is 29% lower than the €39.3 million reported in Q1 2024. The bank continued to hold a strong liquidity position and regulatory capital ratios continued to exceed regulatory requirements.

GO plc closed unchanged at the €2.64 level on a single deal of 1,100.

BMIT Technologies plc held the €0.338 level on muted activity.

Yesterday, Hili Properties plc published its Annual Report and Financial Statements for the year ended 31 December 2024. Total revenue, inclusive of other operating income, increased by 4.7% to a record of €17.0 million. On the expenditure side, operating costs decreased by 4.4% to €4.01 million (2023: €4.20 million). Consequently, the operating profit (EBIT) surged by 8.4% to €13.2 million from €12.1 million in the previous year. Meanwhile, the EBIT margin climbed to 76.8%. Nonetheless, the financial performance was also negatively impacted by net fair value decrease on property assets of €0.42 million (2023: gain of €2.46 million). Meanwhile, net finance costs decreased by 5.7% to €6.54 million from €6.93 million in the previous year. After accounting for a tax charge of €1.36 million, and a profit attributable to non-controlling interests of €0.40 million, the net profit attributable to shareholders amounted to €4.37 million, which translates into a return on average equity of 3.86%. Shareholders’ funds rose by 2.2% to €120.2 million which translates into a net asset value per share of €0.2998. In view of the Company’s obligation to redeem the €37 million 4.5% unsecured bonds later this year, the Board of Directors is recommending that no dividends are distributed for the reporting period.

Yesterday, Malita Investments plc published its Annual Report and Financial Statements for the year ended 31 December 2024. Revenue increased by 7.2% to a record of €10.2 million from €9.53 million in 2023 reflecting an uplift in lease and ground rent income from investment property. Operating profit climbed 5.5% higher to €8.78 million compared to the previous record of €8.32 million last year. The financial performance was negatively impacted by the fair value loss of investment property of €4.72 million compared to the fair value gain of €15.5 million in 2023. Finance income from the Housing Concession Agreements almost doubled to €5.61 million. Overall, Malita registered a pre-tax profit of €6.14 million. After accounting for a tax credit of €0.27 million, the net profit for the year amounted to €6.40 million compared to a net income of €20.2 million in 2023, resulting in a return on equity of 3.4%. Furthermore, total equity increased by 17.7% to €201.8 million which translates into a net asset value per share of €0.9696. The Directors are recommending the payment of an unchanged final net dividend of €0.0185 per share to all shareholders as at the close of trading last Friday 25 April 2025. The dividend will be paid on Monday 30 June 2025 subject to shareholders’ approval at the upcoming Annual General Meeting scheduled to be held on Thursday 25 May 2025. Coupled with the interim net dividend of €0.00858 per share, the total net dividend attributable to the financial year amounts to €0.02710 per share, unchanged from the previous year.

Today, Trident Estates plc announced that its Board of Directors is scheduled to meet on Thursday 29 May 2025 to consider the approval of the financial results for the year ended 31 January 2025. The Directors will also consider the declaration of a dividend.

The RF MGS Index moved 0.02% higher to 917.788 points. Today, ECB Board Member Piero Cipollone stated that a trade war could lower economic growth by about 0.2 percentage points in 2025. Furthermore, in the short to medium term, inflation in the eurozone may even decrease, strengthening the case for an ECB rate cut this June. Meanwhile, he anticipates that as a result of the implications of higher tariffs, the US could face higher inflation and slower growth, which could also undermine confidence in the U.S. dollar’s dominant role in international trade and finance.

 

This report contains only public information and is not to be construed as investment advice or an offer to buy or sell 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.