News Column

UK WINNERS & LOSERS: Imagination Technologies Leads FTSE 350 Fallers

June 27, 2014

James Kemp



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

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FTSE 100 - WINNERS

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Barratt Developments, up 3.6%, and Persimmon, up 1.4%. The housebuilding stocks continue to move higher Friday, following a sharp rise on Thursday. The companies are still gaining after the Bank of England made only very limited new recommendations to control the buoyant UK housing market Thursday, saying that household indebtedness currently poses no imminent threat to the country's economic stability. UBS has released a note on the UK housebuilders Friday, saying that it retains its positive view on the sector following the BoE's "sensible but relatively mild initial step to curb future excesses in the housing market".



Rolls-Royce Holdings, up 1.4%. Reuters has reported that Airbus is very close to a decision to upgrade its A330 with engines provided by Rolls-Royce, citing people familiar with the matter. The move will strengthen a growing strategic pairing between the European companies, with General Electric Co, the main alternative engine supplier on the existing version of the jet, no longer seen as a contender to take part in the USD2 billion project provisionally dubbed "A330neo", Reuters quoted the people as saying. The go-ahead to make Rolls-Royce sole supplier for the new version of the A330, offering up to 14%-15% in fuel savings with the help of new wingtips, remains subject to Airbus board approval, Reuters added.

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FTSE 100 - LOSERS

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Reed Elsevier, down 1.4%, and Meggitt, down 1%. The two companies are two of the biggest fallers in the blue-chip index on the back of some negative broker rating changes. Barclays has downgraded Reed to Equal Weight from Overweight, lowering its price target to 1,005 pence from 1,020p, while UBS has cut Meggitt to Neutral from Buy, trimming its price target to 505p from 520p.



Standard Chartered, down 0.5% at 1,197.50p. The UK-based emerging markets-focused bank is once again among the biggest losers in the FTSE 100, having closed down 4.3% as the blue-chip index's second-biggest loser on Thursday on the back of a disappointing trading update. UBS Friday has lowered its price target on the bank to 1,300 pence from 1,515p, while Societe Generale has cut its target to 1,450p from 1,550p. Canaccord has trimmed its target on the bank to 1,000p from 1,200p.

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FTSE 250 - WINNERS

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Redrow, up 4.5%, Taylor Wimpey, up 2.5%, Foxtons Group, up 2.2%, Berkeley Group Holdings, up 2.1%, Galliford Try, up 1.9%, Bellway, up 1.8%, and Bovis Homes, up 1.5%. The companies continue to rise following the release of an upbeat note on the housebuilding sector Friday and the financial stability report from the Bank of England on Thursday.



National Express Group, up 3.3%. The company has retained its c2c Essex Thameside rail franchise for a further 15 years, after committing to investments of GBP160 million in new trains, more peak-time services, station improvements, and adding free wifi on trains and at stations. In a statement, the UK government's Department for Transport said the new franchise will run until November 2029, and the award reflected c2c's "impressive" performance on the franchise so far.



Keller Group, up 2.3%. The engineering company said there have been no significant changes to its trading or outlook since it published interim results last month. On May 16, Keller Group said trading has been in line with expectations this year, despite a decline in public construction expenditure in the US and a lull in activity levels for major project awards in Canada's oil sands industry.



SuperGroup, up 1.2%. Shares in the fashion retailer have jumped after it took back the rights to trading its Superdry brand in Denmark, Norway and Finland when it bought Scandinavian distributor SMAC Group. It didn't provide any financial details about the acquisition, but said it paid for the deal with cash from internal resources.

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FTSE 250 - LOSERS

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Imagination Technologies Group, down 7.4%. Shares in the technology company have fallen sharply after Intel Capital Corp, the investment arm of chip giant Intel Corp, sold a 9.3% stake in the business, a move its banks said wouldn't impact the operational relationship the companies have. Credit Suisse, which along with Jefferies International and JP Morgan, conducted the sale by Imagination Tech's biggest shareholder, said Intel Capital will be subject to a 90-day lockup on its remaining Imagination Technologies stake of about 5%. In total, 25 million shares were placed by the banks at 205 pence a share, raising gross proceeds of GBP51.25 million. The sale was done through an accelerated book build, meaning little or no marketing was done.



Ophir Energy, down 3.7%. The oil and gas exploration company's shares continue to slip, having fallen 3.9% on Thursday, after it said on Thursday that it has concluded drilling operations on the Okala-1 well in the Mbeli Block offshore Gabon, but failed to find any significant oil. UBS has downgraded the company to Neutral from Buy Friday, lowering its price target to 250 pence from 280p, on the back of the disappointing test results from Gabon.

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AIM ALL-SHARE - WINNERS

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Sula Iron & Gold, up 8.3%. The metals exploration and development company has seen its shares jump after the latest results from drilling at its Ferensola iron ore project in Sierra Leone showed that there is a well-defined iron oxide cap present at the site. Results from the six holes, or 551.5 metres, covered by the latest batch of results it has received have been positive with multiple intercepts in excess of 55% iron, defining a potential direct shipping ore domain and additional high grade laterite and saprolitic material within the oxide zone, it said.

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AIM ALL-SHARE - LOSERS

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Camco Clean Energy, off 34%. The sustainable energy development company said it intends to raise a total of GBP1.5 million before expenses in a placing and open offer at 4 pence per share. It said the issue price of the placing and open offer shares represent a 42% discount to the closing middle market price of 6.875 pence on Thursday. It will place 25 million new shares at 4 pence each in the placing, and up to 13 million new shares in the open offer, on the basis of 1 new shares for every 16 existing shares held, again at 4 pence each. It said it plans to use the funds as additional capital to invest in the business. In a separate statement, the company said it narrowed its losses in 2013, but saw a drop in revenues during the year. Camco's shares are quoted at 4.51 pence.



Pathfinder Minerals, down 33%. The company said it could take anywhere from months to one or two years for the Mozambique Supreme Court to deliver a judgement on whether it will recognise and enforce a ruling in England that it validly acquired its Mozambique licence-holding subsidiary. "I am afraid to say that there is every likelihood of continued extended hiatuses between reportable developments in the Mozambique proceedings," Chairman Henry Bellingham, who joined the company in February, said in a statement.



Outsourcery, down 23%. The cloud-based IT and business communications provider said it has had to cut costs because the sales pipeline of its strategic partner channel has taken longer than expected to ramp up, due to delays in finalising the "organisational, system and their sales force readiness." It said it is considering a number of options to improve its cash resources over the medium term, because the delay will push back its monthly cash flow break-even point despite the cost cuts. Outsourcery said the options include a possible revision or extension of its debt facilities, investment by one of its strategic partners, or raising additional equity.



Clean Air Power, down 19%. The company has raised GBP1 million in a share placing, priced at 4 pence per share, funds it said it will use for additional working capital. The placing price was a 27% discount to the closing mid-market price of the company's shares on Thursday. The company, which develops and provides dual-fuel engines for heavy duty vehicles, said it placed a total of 25 million new common shares, representing roughly 9.7% of the enlarged shares capital of the company in issue. Clean Air Power's shares are currently quoted at 4.395 pence.



Frontera Resources, down 18%. The oil and gas exploration company said it losses widened in 2013, as crude oil sales fell slightly and interest payments increased. It posted a pretax loss of USD11.2 million for compared with a USD8.9 million loss a year earlier, as revenue from crude oil sales dipped to USD6.1 million from USD7.5 million, while interest payments rose to GBP3.8 million from GBP2.7 million a year earlier.



Motivcom, down 16%. The business services group has warned that trading in the first half of the year has been below expectations and that one of its subsidiaries has not retained one of its clients. It said that although the level of its order intake in the first of half of the year remains satisfactory, the delivery of much of this work is heavily weighted into the second half of the year. Motivcom also said that following a protracted tender process, Zibrant Ltd, one of the its major subsidiaries in its meetings and events division, has been notified that it has not retained one of its significant clients and services Zibrant was providing to the client will cease in November.



Armstrong Ventures, down 9.1%. The company has seen its shares slide after it said it had been struggling to find a suitable investment, mainly because it is finding it difficult to raise the funds to make an acquisition. Armstrong , which is classed as an investing company because it currently doesn't have an operating business, made a net loss of GBP262,406 in 2013, wider that the GBP120,997 loss it made in 201, because administrative expenses increased and it booked provisions to cover litigation it had to start to recover a large cash deposit made on a potential transaction.

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Source: Alliance News


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