News Column

UK WINNERS & LOSERS: Balfour Beatty Leads FTSE 350 Fallers

July 3, 2014

James Kemp



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

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FTSE 100 - WINNERS

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Sports Direct International, up 3.9%. The UK's biggest sporting goods retailer by revenue is the biggest riser in the blue-chip index. In a note to investors, Jefferies said it expects the company's upcoming full year results on July 17 to detail strong top-line growth, healthy underlying earnings before interest, taxes, depreciation, and amortisation progress of 16%, an earnings per share increase of 21% and closing net debt of around GBP100 million. The investment bank has a Buy recommendation and a 1,000.00 pence price target on the stock. On Wednesday, Sports Direct shareholders finally backed a bonus plan for executives, including founder Mike Ashley, after repeatedly voting against the move.



Tullow Oil, up 1.1%. The oil and gas exploration company said the Hanssen well in its production licence 537, offshore Norway, has found a 20- to 25-metre region of oil bearing sandstones at its main target, adding to the potential of the Wisting cluster area. It said the well found a good quality reservoir in the StØ Formation and also found poor-quality hydrocarbon bearing sandstones in the Late Triassic and Middle Triassic zones of the well. Tullow said coring and sampling has been carried out on all of the formations but the new discovery produced a maximum production rate of 2,006 barrels per day of oil and 325,000 standard cubic feet per day of gas after a short test at the site. The well was drilled around 7 kilometres northwest of the company's Wisting central oil discovery, which found 50 to 60 metre region of net oil pay in good quality Jurassic reservoir rocks in September, 2013.

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FTSE 250 - WINNERS

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Poundland Group, up 2.5%. The discount retail chain reported strong growth in sales in its recently completed financial year and said they have continued into the current year, boosted by new store openings, although it said its profit for the recent year was held back by costs relating to its recent IPO. Poundland posted a pretax profit of GBP21.5 million for the financial year ended March 30, compared with a pretax profit of GBP26.5 million the prior year. The retailer said profits fell after booking higher costs, mostly relating to its recent stock market flotation in London back in March. Excluding those costs and other one-off items, pretax profit rose almost 24% to GBP36.8 million, up from GBP29.8 million the year before, and at the top end of market expectations for the year. Revenues in the year increased more than 13% to GBP997.8 million, up from GBP880.5 million the prior year, with like-for-like sales up 1.9%. It said the strong trading momentum has continued into the new financial year, which started on on April 1, with sales up 18% in the first three months to GBP262.6 million.



Home Retail Group, up 2.2%. The company said its general merchandise retailer Argos and online auction site eBay Inc have extended and expanded their UK collection service tie-up. Home Retail's Argos and eBay began trialling a UK collection service last September, which they said would last around six months and would enable shoppers to pick up products sold by about 50 eBay sellers at around 150 Argos stores throughout the UK. Home Retail said Thursday the two companies have now entered an agreement to extend the offering of click & collect services via Argos stores, which will enable shoppers to select products from a wider range of eBay merchants and now collect from around 650 its Argos stores.

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FTSE 250 - LOSERS

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Balfour Beatty, down 10%. The construction and infrastructure company said trading has worsened in the mechanical and electrical engineering part of its UK construction business. It said the deterioration amounts to a GBP35 million profit shortfall, but it expects to offset this from gains on disposals from its public-private partnerships portfolio in the second half of the year. The full-year pretax profit guidance remains the same as it gave when it put out a first quarter trading statement in early May.



Greene King, down 3.8%. The British brewer and restaurant owner posted reduced profit for its last financial year despite good revenue growth, due to higher exceptional costs, and said like-for-like sales in its managed retail division have started the new year slower than they did the year before. It recorded a pretax profit of GBP105.2 million for the year ended May 4, down from GBP111.0 million the prior year, which it said was due to higher exceptional costs booked during the year. Excluding those costs, the group's pretax profit rose 9.4% to GBP158.2 million. Meanwhile revenues rose to GBP1.30 billion from GBP1.19 billion a year earlier. Greene King said the good trading momentum has continued into the new financial year, with like-for-like sales in its retail business up 1.1% in the first eight weeks, albeit slower that the 3.3% growth in reported in the same period a year earlier.

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AIM ALL-SHARE - WINNERS

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Mosman Oil & Gas, up 38%. The company's shares have risen sharply after it said the recent oil discovery it made in a well at its Petroleum Creek project met the definition of a discovery under New Zealand law. On Monday, the company had said it had found oil at the Cross Roads-1 well on the Petroleum Creek Project in New Zealand. On Thursday it said it had now received detailed petrophysical analysis from its third-party consultants and determined that the find was an official oil discovery under New Zealand law. It is now planning flow testing later in 2014 on both the Cobden Limestone interval and the Eight Mile Formation at Cross Roads-1. It will also acquire additional seismic data to assist in mapping the extent of the accumulation and drilling locations for appraisal drilling. Mosman added that drilling started at the Crestal-1 well on the site on Thursday.



Quadrise Fuels International, up 12%. The company has seen its shares rise after it said it had agreed with shipping giant Maersk to move the development of its marine fuel oil alternative into a commercial phase after proof-of-concept requirements were met. Quadrise is developing fuel oil alternatives for the shipping, refining and power generation markets. Its main potential product is its MSAR fuel and technology, from which it has already produced bunker fuel. In a statement, the company said a series of full-engine seaborne service tests with WÄrtsilÄ were completed early in June, and they confirmed "good engine and emissions performance" on Quadrise Marine MSAR fuel. Quadrise said its plans to secure agreements in principle with oil refiners by the end of 2014 to support future term supply of the Marine MSAR fuel, working closely with Maersk. Elsewhere, the company has submitted a formal proposal to install a "commercial demonstration plant" in a designated refinery in Saudi Arabia, while, in South Africa, its memorandum of understanding with Ecopetrol has been extended to the end of August to allow the companies to complete the logistics and marketing aspects of their joint feasibility review.



Ortac Resources, up 10%. The exploration and development company said it has restarted underground mining at the Šturec deposit in Slovakia, marking a return to underground operations at the Soviet-era mine, which has been closed for nearly 20 years. The news comes less than a month after the Slovak Central Mining Bureau approved the company's application to begin trial underground mining at Sturec. It said extracted ore will be used for further test work, which will help determine the longer term development of the deposit and the economy of the Kremnicko region.

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AIM ALL-SHARE - LOSERS

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Hurricane Energy, off 13%. The oil and gas company said it has successfully demobilised its drilling unit from testing a horizontal appraisal well on its Lancaster discovery, west of Shetland, after completing the drilling phase last month. It said the Transocean Sedco 712 semi-submersible drill unit was under contract for 73.5 days, which is under its budgeted 75.9 days.



MoPowered, down 10%. The company's shares have fallen after it said that Finance Director Ben Carswell has stepped down and left the company with immediate effect, following a profit warning from the company on Tuesday. The company warned Tuesday that its revenues had risen less than anticipated in its first half, and as a result its revenues for 2014 were now expected to be more modest.



Mediterranean Oil & Gas, down 7.2%. The oil and gas exploration and development company, alongsideGenel Energy, said the Hagar Qim-1 well at the Area 4 licence offshore Malta has failed to find hydrocarbons in its targeted prospects. Mediterranean Oil & Gas said Genel Energy's subsidiary, Phoenicia Energy Co Ltd told it that the well was drilled down to the Eocene region and has now been plugged and abandoned after failing to find any indications of hydrocarbons.

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Source: Alliance News


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