News Column

UK WINNERS & LOSERS: Anglo American, Lonmin Fall As Crisis Talks Fail

June 10, 2014

James Kemp



LONDON (Alliance News) - The following stocks are the leading risers and fallers within the main London indices midday Tuesday.

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FTSE 100 - WINNERS

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Imperial Tobacco Group, up 0.5%. The cigarettes and tobacco company said it will float its European logistics business, Logista, on the Spanish stock exchanges. The group had said back in February that it was reviewing its options in relation to a potential IPO of CompaÑia de DistribuciÓn Integral Logista SA. Imperial Tobacco said that it will launch an IPO of Logista via Imperial's indirect wholly-owned subsidiary Altadis SAU. It said it will sell a portion of its shares to institutional investors, but will retain the majority of Logista shares.



Rolls-Royce Holdings, up 0.1%. The aircraft engine and marine propulsion maker has won a GBP50 million contract to deliver deck machinery for four large anchor handlers for Edison Chouest Offshore. The deck machinery will include low pressure high torque winches, stern rollers, anchor handling cranes and anchor launch and recovery systems. All mechanical, hydraulic and electric systems are included in the package, Rolls-Royce said. First delivery will take place in March 2015, the last in January 2017.

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FTSE 100 - LOSERS

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BT Group, down 3.2%, and British Sky Broadcasting, down 1.9%. The companies have both fallen after BSkyB announced that it will be launching a new channel dedicated to European Football, Sky Sports 5. The new channel will be added at no extra cost, as part of Sky's sports package, and customers who take up the channel can also get two years free unlimited broadband. Analysts at Berenberg said they don't see the new channel as a driver for "customer growth or upgrades", but instead consider the broadband offer as a way for BSkyB to up "the ante against a resurgent BT."



EasyJet, down 1.4%. Liberum Capital has lowered its price target on the airline company to 1,650.00 pence from 1,700.00p, maintaining a Hold recommendation. While the brokerage is confident that easyJet retains a strong position in the European short haul market, and that it remains poised to pursue further profitable and value-accretive growth, it believes that three years of significant improvements in financial performance have created tough comparatives and attracted increased competition.



Anglo American, down 1.2%. Mining companies Lonmin, Impala Platinum Holdings and Anglo American Platinum , a subsidiary of Anglo American, said after the UK equity market close on Monday that the talks set up by the Minister of Mineral Resources to solve the ongoing strikes that are crippling the platinum mining industry in the country and weighing on its economic growth dissolved without an outcome. The strikes, which are now in the twenty-first week, have cost mining companies over ZAR21.7 billion, according to the companies.

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FTSE 250 - WINNERS

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Oxford Instruments, up 1.9%. The technology tools and systems company has reported a fall in pretax profit for the year to end-March, as it was hit by costs relating to its acquisition of Andor Technology in January, but said that orders for the first two months of its new financial year are ahead of the same period of the previous year. It posted a pretax profit of GBP24.0 million, down from a restated GBP28.4 million, as a rise in revenue to GBP360.1 million from GBP350.8 million was offset by GBP23.1 million in exceptional costs relating to acquisitions. The company proposed a total dividend for the year of 12.4 pence, up from the 11.2p in the previous year.

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FTSE 250 - LOSERS

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Lonmin, down 4.8%. The mining company is the biggest faller in the mid-cap index after saying that last ditch attempts to overcome mining strikes in South Africa have failed.

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AIM ALL-SHARE - WINNERS

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Max Petroleum, up 35%. The oil and gas company said its ZMA-E7 development well in Kazakhstan's Zhana Makat Field has reached total depth and has successfully found an expected region of hydrocarbons. It said the well reached a depth of 997 metres and found hydrocarbons in Jurassic sandstone reservoirs. It will now complete the well and place it on production as soon as possible.



Thor Mining, up 24%. The mineral exploration and development company has signed a deal for the acquisition of the Pilot Mountain tungsten project in the US state of Nevada, for a total cost of AUD2.3 million in shares and assumed loans. It said that, subject to approval, it has agreed to buy the project from Black Fire Minerals for 418.8 million shares in Thor, with a 12 month escrow period, and the assumption of loans totalling AUD625,000, payable by September 30, 2015.



Tristel, up 18%. The manufacturer of infection prevention, contamination control and hygiene products said it had increased its full-year pretax profit expectations as it anticipates further acceleration in revenue growth, following previously upgrading expectations in April. It said that the strong momentum in its underlying business reported in March and April is expected to continue through to its June year-end and beyond. Further acceleration is anticipated in revenue growth, and the company has therefore raised its internal expectations both for the current and subsequent financial years. Pretax profit, before share-based payments, for the year to end-June is now expected to be not less than GBP1.75 million. In 2013 the company reported an adjusted pretax profit of GBP480,000, adjusted for non-recurring items of GBP2.2 million.



Tandem Group, up 14%. Shares in the designer, developer and distributor of sports and leisure products have risen after the company said that revenue in the first 22 weeks of the year grew 26% on the previous year. It said that revenue in its sports, leisure and toys business rose approximately 62% in the 22 weeks to May 31, while sales of bicycles and accessories withstood a competitive leisure cycling market, up 6% in the period.



Private & Commercial Finance Group, up 9.1%. The group said its full-year pretax profit increased by half, driven by an increase in revenue, as the finance house grew its portfolio for the first time since the start of the financial crisis. It said work also is being done to obtain a deposit-taking licence that would allow the group to further boost its size. The company said it made a GBP1.3 million pretax profit in the 12 months to end-March, compared with GBP829,000 a year earlier. Revenue increased to GBP42.7 million for the year, up from GBP41.4 million, boosted by growth in both its consumer and its business lending units. New business volumes increased to GBP50.8 million, from GBP39.3 million, driven by the consumer finance division. Administrative expenses fell to GBP6.9 million, from GBP7.2 million, as the group kept costs under control and kept average staff numbers static.



Alecto Minerals, up 5.1%. The gold mining company said it has found new prospects on the Massakama target at the Kossanto gold project in Mali following a large drill programme, with strong indications that the site hosts an extensive gold-bearing system. It said 18 out of 24 drill holes completed on the site, for a total of 1,998 metres of drilling, found gold mineralisation including a two metre space at 13.54 grams per tonne of gold from seven metres in depth at the TRC009 hole and a 23 metre space at 0.67 grams per tonne of gold from 16 metres in depth.

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AIM ALL-SHARE - LOSERS

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GETECH Group, off 16%. The company's shares have slumped after it said it will deliver full-year pretax profit "significantly below the market expectation" after client purchasing slowed in comparison to the previous year. In a trading update for the 12 months ending July 31, the oil and gas services business said that while it has continued to see strong demand for its consultancy work, actual purchasing by clients has been slow by comparison with last year and predicting the timing of new contracts has been difficult. Brokerage WH Ireland had previously forecast pretax profit for the year of GBP2.4 million, on revenues of GBP8.4 million, but says there will now "clearly be material downside," to those numbers. The broker has placed its previous Buy rating under review.

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Source: Alliance News


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