Join our community of smart investors

News & Tips: Thomas Cook, Gulf Keystone, Ladbrokes, HSS Hire & more

Equities are getting thumped
June 29, 2015

The UK market dipped in morning trading following the ECB’s decision not to further extend ELA to the Bank of Greece, not to mention the collapse of further talks on Friday. There's bad news from the other side of the world too: the governor of Puerto Rico has admitted the country can't pay back its $72 billion debt.

IC TIP UPDATES:

Shares in Gulf Keystone Petroleum (GKP) fell 10 per cent in early trading, despite confirmation the group is producing in excess of 40,000 barrels of oil per day. Discussions are ongoing with the Kurdistan Regional Government to establish a regular payment cycle for all oil sales. We will review our latest view on the stock in due course.

As we suspected in our recent buy tip building products supplier Alumasc (ALU) has offloaded its small loss-making precision engineering unit for £5.8m. The one-off costs associated with exiting the business are expected to be circa £2m.

Payments processing company SafeCharge International (SCH) will move its official domicile from the British Virgin Islands to Guernsey. It's expected the re-domicile will become effective between September and October 2015. We still rate the shares a buy.

Simon Thompson pick Redde (REDD) confirmed final quarter trading has been positive, and annual operating results should therefore outperform current market expectations. Investors will also receive a special dividend worth 1p a share on 30 July 2015. The shares will become ex-dividend on 9 July 2015.

Another Simon Thompson favourite, Avation (AVAP), has signed a lease to supply an additional new ATR72-500 aircraft to Flybe (FLYB), the UK-based regional carrier. This lease is at typical lease rates and is for a term of six years with an option for a further six years.

KEY STORIES

Shares in tour operator Thomas Cook (TCG) lost 5 per cent in early trading in the wake of the terrorism attack in Tunisia. The company has already flown over 1,000 tourists back from the country, scrambling extra flights on top of scheduled services for people seeking to flee.

High street bookie Ladbrokes (LAD) has deferred a business review which was scheduled to be presented to investors on 30 June 2015. The decision was taken in light of ongoing talks with Gala Coral over a possible merger between the two companies.

Shares in HSS Hire (HSS) plummeted nearly 20 per cent after the group revealed weak demand in April and May had impacted second quarter trading. Along with rising start-up costs, first half cash profits are expected to be broadly in line with last year.

Northcote Energy (NCT) shares suffered an 8 per cent blow after the group confirmed the sale of its 100 per cent working interest in the East Blackwell Skinner Sand Unit in Kay County, Oklahoma to a private party for $75,000.

OTHER COMPANY NEWS

Having suspended its shares from the London Stock Exchange, troubled Quindell (QPP) has said annual accounts are still under an auditing process, and will not be published before 30 June 2015.

Central Asia Metals (CAML) said an "incident" at one of its copper sites in Kazakhstan on Friday 26 June will impact production guidance for 2015 by 13,000 tonnes. However, no one was hurt and the impact is expected to be temporary.

IT service provider Redcentric (RCN) has won a contract with the Health and Social Care Information Centre worth in excess of £3.5m. During the two year contract Redcentric will provide a Database as a Service (DBaaS) system, devised to support a national infrastructure programme.

Aim minnow Blue Star Capital (BLU) was one of the FTSE's biggest fallers, after it announced its investment in payments technology business Sthaler. The company invested £50,000 in return for 1.45 per cent of the issued share capital of Sthaler, as part of a £450,000 round of investment by Sthaler.

Software group Progility (PGY) admitted trading in the final few months of the financial year had not been sufficient to boost profitability. Cash profits are expected to be materially below market expectations when the group releases results later in the year. The shares crashed 28 per cent.

Oil and gas outfit Xtract Resources (XTR) lost 10 per cent from its share price in early trading following a placing to raise £4.4m. The cash will go towards buying the the 3990C Manica Gold mining license (which includes a number of gold prospects including the Fair Bride open pit gold deposit) in Mozambique.