Equities have dipped a little in early trading following the election result in Greece which threatens future crises in the eurozone. Click here for The Trader Nicole Elliott’s latest take on the markets.
IC TIP UPDATES:
Sell recommendation SSE (SSE) has become the latest energy supplier to announce a cut to its prices with its gas tariff to come down by 4.1 per cent from 30 April and its gas and electricity price fix will then be extended out to July 2016. Meanwhile, full year results are expected to be in line with forecasts despite a fall in consumption of both gas and electricity due to milder weather.
Stobart (STOB) has agreed a 14 year index linked supply agreement for biomass fuel for a wood-fuelled biomass plant in South Wales. It will process and supply 250,000 tonnes a year to the plant from 2017. This means the company has secured half of its planned doubling in biomass volumes from 1m tonnes at present to 2m tonnes by 2017-18. We maintain our buy rating.
Project management and technical consultancy WYG (WYG) says it is creating ‘almost more opportunities than it can readily service’ and has initiated a strategic review of its business to see whether a strategic combination or sale to another business would better serve its interests. Buy.
Simon Thompson recommendation Safestyle (SFE) says trading has been strong despite a small contraction in its overall markets. Revenues grew by 9 per cent to £136m in the year to December as the company grabbed market share of 8.48 per cent, up from 7.85 per cent the previous year. The order book ended the year 3 per cent ahead of last year.
Another Simon Thompson recommendation, telecoms customer engagement specialist Netcall (NET) says it has traded in line with expectations and has continued to grow its order book.
Specialist engineering data and design business Aveva (AVV) says it has traded broadly in line with expectations but it is seeing increased uncertainty and reduced visibility in the oil and gas markets which make up 45 per cent of its revenues. We keep our sell rating.
KEY STORIES:
International Consolidated Airlines (IAG) has further improved its proposed offer for Irish carrier Aer Lingus (AERL) to €2.50 a share plus a €0.05 dividend.
Temporary power specialist APR Energy (APR) reports that it has decided to reallocate resources that had been earmarked for Libya due to the continued failure of the Libyan parliament to ratify its contract.
Rolls Royce (RR.) has won a contract to supply engines for 232 freight trains which will be made by China’s CNR Dalian for use in South Africa. The contract is worth in the region of €100m.
Balfour Beatty (BBY) has been appointed preferred bidder for a student accommodation project at Sussex University which would see a 600 bed facility replaced with a 2,000 bed project including new student union facilities and ‘social hubs’. The contract is structured as a 50 year design, build, finance and operate deal.
LondonMetric Property’s (LMP) third quarter trading statement details the £362.1m of investment activity undertaken during the nine months comprised of nine property acquisitions worth £157.8m and the sale of more than £200m worth of properties, repositioning the portfolio towards retail-led distribution and out of town retail.
OTHER COMPANY NEWS:
Irish building materials group Kingspan (KGP) has confirmed it is in advanced discussions with European steel products specialist Joris Ide over its potential acquisition.
Airline FlyBe (FLYB) says its transformation is progressing to plan as it reported a 2.4 per cent rise in passenger revenue per seat and a 5.5 per cent rise in load factors to 74.3 per cent for the three months to 31 December. Overall passenger revenues fell by 3.8 per cent after a 6.1 per cent reduction in seat capacity. The company says that hedging against dollar and oil price movements means that the recent shift in fuel prices will have little effect on the business before 2016.
Petra Diamonds (PDL) has revised down its full year production guidance from 3.3m carats to 3.2m carats after lower than expected first half production with grades produced at its older mines coming in lower than expected. First half revenues rose by 16 per cent to $214.8m, but this was boosted by the sale of two exceptional diamonds for $38.7m.
Recruiter SThree (STHR) grew group gross profit by 18 per cent in the year to November with operating profits up 42 per cent despite currency headwinds. Significant growth was provided by its US business and also a shift into new categories such as energy and life sciences.
Specialist filtration business Porvair (PRV) has announced a number of contract wins worth $5.5m alongside strong full year results which showed record revenues of £104m and profits of £8.4m, up 10 per cent on last year.
