Join our community of smart investors

News & Tips: South32, Oxford Metrics, Chemring & more

London markets are rattled by emerging markets currency doubts
August 13, 2018

Rising concerns around the Turkish economy are seeping into the wider consciousness of emerging markets investors and there are worries growing about European banking exposure too, sending shares in London south in morning trading. Click here for The Trader Nicole Elliott's latest take on the markets.

IC TIP UPDATES:

South32 (S32) has completed its all-cash, $1.3bn (£1.02bn) takeover of Arizona Mining, owner of the zinc-lead-silver Hermosa project, first announced midway through June. The deal, which was struck at a 50 per cent premium to Arizona’s share price, has drawn some scepticism from analysts and investors, though we remain buyers of South32.

Vicon, a subsidiary of Oxford Metrics (OMG) and a supplier of motion capture and tracking systems, has launched Origin - a new offering for the location-based virtual reality (LBVR) market. LBVR entails participants sharing VR experiences in specific locations – for example, shopping malls. The group says Vicon’s solution “overcomes a number of challenges facing the LBVR market today” such as scaling the size and complexity of a particular virtual environment. The shares were up around 3 per cent in morning trading. Buy.

Brewin Dolphin (BRW) have appointed Siobhan Boylan as finance director, replacing Andrew Westenberger. Ms Boylan - who is currently chief finance officer at Legal & General Investment Management - will take up the role in early 2019. Buy.

KEY STORIES:

Shares in Chemring (CHG) were marked down heavily after the defence contractor said it expects the impact of a fatal explosion at its Chemring Countermeasures facility near Salisbury to lower the group’s underlying operating profit for the current year by £10m to £20m. A full investigation into the cause of the incident has been launched.

OTHER COMPANY NEWS:

Plus 500 (PLUS) gained 94,148 new customers during the first-half, up three-quarters on the same time the previous year. However, churn was once again high, with active customers more than doubling to 248,564. Nevertheless, net profit also more than doubled to $262m, while management boosted the dividend to 137.86ȼ a share. However, the shares were down 14 per cent at the time of writing, which may be because management said it did not expect the “exceptional” performance of the first-half to be repeated.  

West African gold producer Avesoro Resources (ASO), has had a huge year so far, as interim numbers attest. In the first half of 2018, gold production climbed 318 per cent to 128,319 ounces, putting the group on course to surpass a full-year target. All-in sustaining costs are also down 40 per cent to $932 an ounce, and the company expects “further improvements in unit cost performance” as mining volumes step up at both New Liberty, in Liberia, and Youga, in Burkina Faso.