Anglo Asian delighted to announce that the firm is debt free
Anglo Asian Mining (LON:AAZ) have told shareholders and the market that the company is now debt free.
The firm described this as a significant achievement for Anglo Asian, and shareholders should be sharing the delight just as much as senior management.
Anglo Asian noted that they had signed a loan agreement with Pasha Bank in February 2018, which was worth $15 million.
The loan had an interest rate of 7% per year, however only $13.5 million was eventually drawn down meaning that the whole loan has now been paid.
Anglo Asian CEO Reza Vaziri commented:
“I am delighted to announce that the Company has made the final repayment of the Pasha Bank refinancing loan, marking the significant milestone of Anglo Asian now being debt free.
“The facility was taken out to improve the Company’s financial performance and provide operational flexibility. Given that the net debt of the Company peaked at over $50 million in 2015, this milestone is a remarkable achievement.
“Since 2015, as well as paying off its debt, the Company has continued to invest in its business, embarked on a three-year exploration programme at its contract areas, commenced payment of regular dividends and built up a significant holding of cash. This amply demonstrates the robust cash generation of the Company.
“The financial flexibility of being debt free allows Anglo Asian to focus on the growth of the business which I look forward to updating the market on as and when appropriate.”
Zenith Energy close to purchasing new asset in West Africa
Zenith Energy Ltd (LON:ZEN) have said that they are close to purchasing a new asset for production in West Africa.
Zenith are yet to formally name the new asset, however the firm did say that it last produced over 1,000 barrels of oil per day.
The firm added that negotiations are still ongoing with an unnamed “national oil authority”.
The rate of production is certainly impressive for the potential acquisition, and Zenith have expressed intentions to get the facility operating at maximum production. The energy firm noted that a rehabilitation program might be required to restore the production.
The cost of this program would be spread over two or three months using a benchmark price of $40 per barrel of oil.
Andrea Cattaneo, Chief Executive Officer, commented:
“We believe the acquisition of the asset could represent a unique opportunity for achieving a quantum leap in Zenith’s development. The Potential Acquisition will complement our recent acquisition in the Republic of the Congo and enlarge our footprint in a prolific oil production region.
I take the opportunity to thank our advisors who have enabled us to achieve rapid progress in pursuing development opportunities in Africa during recent months.
I look forward to providing further updates in due course.”
Zenith strike deal with AAOG
A few weeks back, Zenith told the market that they had struck a deal with Anglo African Oil and Gas (LON:AAOG) for their operations in Congo. The firm said that a put-and-call option has been formally signed for the last 20% stake in AAOG’s Congolese operations. The two parties have agreed that this option can only be exercised by Zenith on January 16, 2021. Another clause was inserted saying that the option is only valid if total production from Tilapia has never exceeded an average of 2,000 barrels a day for any period of 30 consecutive days. Zenith will have to pay £1 million in shares if it does decide to exercise the option. AAOG can only exercise the option, on the same day as Zenith, if production has averaged at least 4,000 barrels a day for 30 consecutive days prior to January 15, 2021. Shares in Zenith Energy trade at 1p (-4.51%). 12/2/20 11:23BST.Itaconix shares spike 18% following agreement with New Wave Global Services
Itaconix PLC (LON:ITX) have seen their shares rally as the firm announced it had signed a new licence and supply agreement with New Wave Global Services.
Itaconix outlined that New Wave Global Services is a North American detergent supplier.
The firm said that the licencing agreement is for a new new dishwashing detergent formulation, based on the new Itaconix TSI322 detergent polymer.
The firm said: “The new dishwashing formulation is based on the new Itaconix® TSI™ 322 detergent polymer which the Company introduced last month. In December 2018, Itaconix announced a license agreement with New Wave for a new triple-chamber dishwashing detergent pod based on Itaconix® CHT™ 122. New Wave has gained new accounts and grown its volumes, with the formula now used in private label brands at retailers throughout North America. The new formulation offers New Wave additional competitive advantages available with Itaconix® TSI™ 322. Roll-out into an expanded customer base for New Wave is expected to commence later in 2020. “
The supply agreement is to support internal growth for the company, and forms part of a growth strategy led by Itaconix.
The deal is the second that has been struck with New Wave, following an agreement in 2018 for a new ripple-chamber dishwashing detergent pod based on Itaconix CHT122.
John R. Shaw, CEO of Itaconix, stated: “We look forward to accelerating our work with New Wave on the opportunities ahead for a new generation of dishwashing detergents. With these agreements and other prospects providing a strong pipeline, I am excited about our growth trajectory and broader recognition our polymers are gaining as key differentiating ingredients in major consumer products.”
Itaconix’s deal with Croda
In January, Itaconix announced that they had delivered the initial order of polymeric zinc complex Zinador 35L to FTSE 100-listed chemicals firm Croda International PLC (LON:CRDA). The agreement was initially agreed in 2017, for the supply of its polymer-based odour removal additive Zinador 22L to Croda, for home and industrial applications. In October, both the firms agreed to expand the deal to include Zinador 35L, which is designed for use in detergent and industrial applications. The update from Itaconix today is a pleasing one, and shareholders should be keen to see the benefits that can be exploited with this new agreement. Shares in Itaconix trade at 1p (+18.57%). 12/2/20 11:10BST.US Election: Bernie Sanders narrowly wins New Hampshire primary
The US Election is well underway, and certainly the race for the White House is heating up as we edge closer to the November unveiling of results.
As states prepare for their relevant primaries of caucuses, many have speculated on the uncertain nature of the 2020 US Election.
Last night was the turn of the New Hampshire Democratic Primary, and this was a contest which was not to be missed.
New Hampshire is notoriously a famous seat in the US Election as it is known for its plurality of independents running, its volatile nature and its wide demographic base.
This was the second state in the election cycle that would be voting for their representative, following Iowa a few days back.
It was announce that Democratic candidate Bernie Sanders had narrowly won the New Hampshire Democratic Primary.
Interestingly, many have speculated about the possibility of Sanders running directly against Trump in this election. The optimistic nature of Sanders combined with his slightly left wing but liberal views mean that he is a hit with voters – however will he be able to do enough to be the incumbent that is Donald Trump?
The win for Sanders did deal a blow to rival Joe Biden, who faced a stint as Vice President within the Obama years, however both Biden and Sanders have become strong contenders for 2020.
“This victory here is the beginning of the end for Donald Trump,” Sanders told supporters in Manchester, New Hampshire.
Sanders has pledged to make the tax system more progressive in America and promote issues such as inequality to take power away from big corporations and businesses.
The challenges faced for the Democratic Party are still quite unclear in this election, with the campaign of Sanders there is a clear candidate who could challenge Trump to the last hurdle however incumbent President’s always have an advantage.
Sanders won the Primary last night with 26% of the vote with Buttigieg just losing with 25%.
Notably former Vice President Biden only took 8% of the vote, however elections do have a way of swinging when results seem to be consolidated.
“It ain’t over, man. It’s just getting started,” Biden told supporters in South Carolina.
“We just heard from the first two of the 50 states,” he said. “Where I come from, that’s the opening bell, not the closing bell. And the fight to end Donald Trump’s presidency is just beginning.”
The US election is certainly heating up, and many will be looking at the next set of primary and caucuses to see how events unfold.
Babcock lower profit expectations for financial year
Babcock International Group PLC (LON:BAB) have lowered their profit guidance on Wednesday as shares have been hit.
Shares in Babcock trade at 530p (-4.71%). 12/2/20 10:29BST.
The defense firm said that profit guidance is expected to be lower and that the firm could face a £85 million one off costs from its oil and gas business.
Within the annual period, which ends in March the firm said that they are speculating underlying profit to be around £540 million.
Notably, this would see an 8.2% slump from the £588.4 figure one year ago, which may concern shareholders.
Babcock’s previous guidance for financial 2020 was for operating profit in the range of £540 million and £560 million.
On a better note, the firm held its forecast for underlying revenue which lies around the £4.9 billion figure, seeing a 5.1% drop from £5.16 billion year on year.
Underlying earnings per share are expected to meet analyst and market forecasts which range between 71.1 pence to 71.4 pence. This would see a year-on-year fall as high as 15% from 84.0p.
Babcock did praise their performance in the year however, as its order book and pipeline is at a record level of £34 billion.
The firm said: “As flagged in November, there have been delays in the award of new contracts for aerial emergency services in Italy and Spain. Since then, we have won or been selected as preferred bidder for contracts worth around £600 million but the delays have pushed revenue into future periods.
Oil and gas continues to be a tough market. The three large providers of helicopter services who operate worldwide in oil and gas have all emerged from Chapter 11 bankruptcy protection with reduced debt and written-down assets. This has effectively reset global market pricing levels, forcing us to respond quickly to remain competitive. We will also exit our oil and gas businesses in Ghana and Congo.”
Interim profit growth for Babcock
Back in November, the form reported strong profit gains within its interim results. For the six months to September, the firm reported pretax profit of £152.5 million, which was a huge rise from the £65.1 million figure a year ago. However on an underlying basis the figure dropped by 18% to £202.5 million from £245.5 million. Revenue meanwhile dropped by 2.7% to £2.19 billion from £2.25 billion the prior year, with underlying revenue also slipping by 4.7% to £2.46 billion from £2.58 billion. Babcock said that the revenue dropped because of the step downs in its Queen Elizabeth Class aircraft carriers contract, which contributed heavily to the falling revenue figures. Revenue declined on the ending of Babcock’s Magnox contract with the UK’s Nuclear Decommissioning Authority, as well as a one-off benefit of £90 million a year before in asset sales related to the group’s Fomdec contract in Aviation.Babcock’s CEO departs
One week ago, the CEO of Babcock announced that he would be departing the company. The firm said that Chief Executive Officer Archie Bethel will be stepping down from his role, and will depart when a suitable replacement is found. Bethel has held his role for four years, and has been with Babcock for 16 years since his initial appointment since 2004. Babcock also announced that it would be appointing United Utilities Group PLC’s Chief Financial Officer Russ Houlden as non-executive director with effect on April 1. Houlden has held his role at United Utilities for ten years since 2010, and has also held senior roles on the reporting committee of the 100 Group. This is a rather interesting time for Babcock, however shareholders will remain optimistic for current operations in 2020.PLUS500 revenue and profits drop in 2019, however optimism remains for 2020
PLUS500 Ltd (LON:PLUS) have seen a drop in revenue and profit for 2019, however have remained confident in their 2020 expectations.
The firm told the market that 2019 was a “year of two halves” and praised performance in the second half following the arrival of new trading opportunities.
PLUS500 noted that pretax profit was $189.3 million in 2019, seeing a drop from $503.0 million in 2018, quite a substantial drop when comparing the figures.
Revenue also suffered, and in 2019 totaled to a figure of $354.5 million, down from $720.4 million.
The firm noted that the first half performance in 2019 was bruised by low volatility, as this was particularly seen in the first quarter.
However, this was slightly offset in the second half where performance was driven by “increased trading opportunities identified by customers, reflecting more volatile market conditions during the rest of the year.”
PLUS500 declared an interim dividend of $0.3767 per share, a decrease from $0.6191 a year ago. This lowered the total dividend for 2019 to $0.6501 per share from $1.9977 in 2018.
PLUS500 also announced a new share buyback program that would be commencing, which will run until August 31st managed by Credit Suisse.
Asaf Elimelech, Chief Executive Officer of Plus500, commented:
“We finished 2019 in good financial and operational shape following a period of changes for the industry, which has provided a more certain regulatory outlook for Plus500 and the industry as a whole.
“We were particularly pleased with the strong improvement in financial performance in the second half of 2019 and believe that customer trading patterns have now adjusted following the regulatory changes introduced in Europe last year. We continue to monitor and prepare for any potential product intervention measures that are expected to take place in Australia during 2020.
“I am also encouraged by the trading momentum we have shown through the year end, reflecting continued optimisation of our marketing spend, enhancements to our customer service, improvements in our proprietary technology platform and additional cost optimisation.
“We are further pleased in our ability to provide significant value to our shareholders with the delivery of strong returns representing 100% of our 2019 net profit.
“Looking forward to 2020 we are confident of the prospects for the Group as we focus on further strengthening our customer offering and market positions, thereby delivering growth and further strong shareholder returns.”
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (“MAR”). Upon the publication of this announcement via Regulatory Information Service (“RIS”), this inside information is now considered to be in the public domain.
PLUS500 have maintained their confidence in current trading and are expecting to meet internal expectations for 2020 business.
PLUS500 anticipate the drop in earnings
At the start of January, PLUS500 gave a warning to shareholders about annual earnings, this may have eased shareholders however the results today would have been disappointing. The firm said that shareholders can expect a substantial drop in earnings and revenue across 2019, following a “period of change within the industry”. The firm said that its earnings before interest, taxes, depreciation and amortisation is expected to be $190 million, on revenue of $354 million, which will worry shareholders. This would see the firm drop its earnings by over 62% from 2018, and a 50% fall in revenue. Although the results today were anticipated, shareholders will be keen to see a fight from the firm to bounce back in what seems to be a tough wider operating environment. Shares in PLUS500 trade at 944p (+3.71%). 12/2/20 10:20BST.Dunelm shares spike 8% following strong interim update
Dunelm (LON:DNLM) shares have spiked on Wednesday morning, following a strong set of interim results published by the British firm.
The homeware and furniture retailer said that they had seen a strong six month period of trading, which led to the delivery of strong results today.
Dunelm mentioned that in the six month period which ended December 28, pretax profit totaled £83.6 million seeing a 19% climb from the £70 million figure just one year ago.
Revenue additionally grew by 6% on an year on year basis, to £585 million from £555.8 million, and like for like revenue also grew 5.6%.
Sales surged for Dunelm, like for like sales from stores rose by 2% and online sales carried momentum driving results as these saw a 33% gain.
The FTSE 250 listed firm lifted its interim dividend to 8 pence per share, which represents an increase of 6.7% from the 7.5 pence figure last year.
Dunelm forecasted by saying that they expect annual pretax profit to beat market and analyst expectations, and should be within the £135 million to £137.3 million ball park.
Nick Wilkinson, Chief Executive Officer, commented:
“We have made good progress over the first half, following a strong performance last year, which is reflected in the significant growth delivered in both sales and profits.
“We continue to build strong foundations for future growth. The successful launch of our digital platform accelerates our ability to innovate our customer proposition and we remain focused on operational improvements across all areas of the business.
“We also continue to broaden our customer base and following the successful sponsorship of ITV’s This Morning, which concludes in March, we are excited about our new sponsorship deal with Channel 4’s First Dates programme, starting later this week, which will enable us to reach more customers with the Dunelm brand.
“The third quarter has started well, with a successful Winter Sale across the total retail system. As a result, we expect full year FY20 profit before tax to be slightly ahead of the top of the latest range of analyst expectations7. We are monitoring the Coronavirus outbreak carefully. To date we have not assumed any material disruption to our supply chain or any financial impact in the year.
“We have plenty to look forward to over the remainder of the year as we strengthen the Dunelm offer and help more customers to create the home they love.”
Analysts were quick to praise Dunelm and their recent performance. John Woolfitt, Director of Trading at Atlantic Capital Markets commented: “Overall Dunelms figures read very well, the online presence is certainly starting to feed into the headline numbers. The strong increase in profit translates into a positive jump on the eps and they have also trimmed net debt. Despite retail being a struggling sector, Dunelm have bucked the trend and backed up their last trading statement which was also positive with yet another bullish report. Investors will no doubt be happy with this positivity translating to an increase in the dividends.”
Confident expectations pay off for Dunelm
In January, the firm gave shareholders confident expectations in their thirteen week update. Dunelm said that like for like sales in a thirteen week period to December 28 surged 5%, whilst total sales growth including new stores was 6.2% higher in the second quarter. The company also impressively noted that gross margin improve by 110 basis points in the second quarter, mainly due to sourcing gains and lower product markdowns. Margin improvements were made across all product categories, Dunelm said. The company added that the regulation of IFRS 16 reduced pretax profit by £1.3 million in the first half of financial 20.Dunelm’s strong few months
In December additionally, Dunelm saw their shares in green. The FTSE 250 lister confirmed the “successful” transition of all of its customers to a new digital platform and said it now expects annual profit to beat its previous forecasts. The firm added that gross margins were stronger than expected in the first half of its current financial year as a result of sourcing gains and better sell through. Meanwhile, operational costs remain well controlled and in line with the company’s expectations. Dunelm have managed to pull a rabbit out of the hat with this update, and have seemingly beat the theory that the British High Street is facing trouble. Shareholders will remain optimistic on this update and will hope that strong trading can continue throughout 2020. Dunelm shares trade at 1,308p (+8.91%). 12/2/20 10:06BST.Is that a market rebound in your pocket? Or are you just happy to see the Dow open?
The Dow Jones booked another session of impressive performance on Monday, but Tuesday’s winners were the European indices, displaying something of an unsubstantiated market rebound.
Twittering Trump & Donald’s Dow Project
POTUS Donald Trump offered his two cents on the performance of US stocks today – opting to blame the sluggish start on Powell’s unaccommodating monetary policy.Rather than do the wise thing and recognise wider market tensions, the president decided instead to throw a hissy fit and misinform the public. I mean, why advocate for wiggle-room when you can whinge about not being gifted a short-term rally in the run-up to election season? Responding to the pressure to resort to negative interest rates, J. Powell commented, “I’m not following the market as I sit here answering your questions… My colleagues and I are completely focused on using our tools to support the American people, to support the achievement of our goals and that’s really all we’re focused on.”When Jerome Powell started his testimony today, the Dow was up 125, & heading higher. As he spoke it drifted steadily downward, as usual, and is now at -15. Germany & other countries get paid to borrow money. We are more prime, but Fed Rate is too high, Dollar tough on exports.
— Donald J. Trump (@realDonaldTrump) February 11, 2020
“When you have negative rates, you wind up creating downward pressure on bank profitability, which limits credit expansion.”
He added, on the Bank of England’s upcoming Climate Change Impact report:
“As severe weather becomes more common, and that’s connected to climate change, you will see those things entering the forecast period, and certainly entering our supervisory practices as well as our economic forecasting,”
Market winners and losers
The big news from the US today came from social media behemoth Facebook (NASDAQ:FB) dropping 2.28% or 4.85 USD to 208.61 USD a share. The biggest large cap loser, though, was Goodyear (NASDAQ:GT), down 13.04% or 1.72 USD to 11.47 USD a go, after the company fell short of its earnings estimates. There was some rebound in oil, however, with Texas Crude up 1.50% to just over $20 per barrel. This came with talks today between Russian President Vladimir Putin and the leader of the country’s largest oil producer, Rosneft (MCX:ROSN), on the possibility of holding back 1.8 million barrels in oil production in an OPEC alliance to increase oil prices. While oil price rises aren’t usually conducive to liquidity, it may be a welcome counterweight to the $20 per barrel price slash over the last month, brought on by Coronavirus. The biggest winners today were without a doubt the European indices. After relying on the Dow Jones for injections of optimism over the last couple of weeks, the FTSE, DAX and CAC today found a new story to chase. Despite the plethora of worries – from the Coronavirus, Brexit, US-China trade wobbles and the Bank of England’s upcoming climate change report – Eurozone equities were happy to clutch onto any slim glint of optimism. Today, this was provided courtesy of the world’s larger central banks, many of whom pledged to tackle the threat to markets posed by Coronavirus (which – in regular terms – will likely involve further, myopic deepening of negative rates).Overview from a fellow optimist
Speaking on the movements during today’s session, Spreadex Financial Analyst Connor Campbell stated,“Europe maintained its arbitrary optimism throughout the session, joined in its gains by the Dow Jones.”
“Like pretty much every day since the coronavirus became a major market concern, Tuesday has seen just as much debatable ‘good’ news for investors to hold onto as unquestionable bad news for them to try and ignore. After all, the morning’s headlines were full of fears that the illness could come to infect 60% of the global population, with the total death toll crossing 1000.”
“Nevertheless, investors’ appetite to keep buying – alongside the hopes that the world’s central banks are prepared to step in to dull the impact of the outbreak – produced another strong rebound for the European indices.”
“The DAX rocketed to an all-time high of 13650 as it added 170 points, while the CAC crossed 6050 after rising 0.6%.”
“Even the FTSE managed to rise 0.9%, leaping past 7500 once more. And this despite gains for sterling, which added 0.3% against dollar and euro alike following a broadly encouraging morning for GDP data (the 0.3% rise in December more so than the stagnation in Q4 as a whole).”
“The Dow Jones wasn’t quite enthused as its European peers. However, that’s in part because the index’s own gains on Monday helped inspired the growth seen by the FTSE, DAX et al. Instead the Dow added 120 points, lifting it back towards 29400, and putting another run at its own record peak on the table this week. That is, unless the negative coronavirus headlines don’t reach critical mass once again.”
“It will also be curious to see whether or not the results of this evening’s New Hampshire primary have any effect on the Dow. The Iowa caucus gained little market attention, at least partially because it was so unclear who the actual winner was. There likely won’t be any such confusion come tomorrow morning.”
Final note
Compounding the somewhat woeful state of affairs, the advice from UBS took the tone of ‘drink water when thirsty’; telling investors that Coronavirus would continue to pose a threat to global equities, and we should therefore look to gold for safety.AA expect to meet earnings across 2020
AA PLC (LON:AA) have given shareholders an update with a positive tone, which has led to shares in green on Tuesday afternoon.
The firm said that it expects to report growth in earnings across 2020, as cash flows should sustain to meet market expectations.
The firm said that it had carried forward positive sentiment in the twelve months which ended January 31, which should give annual results a positive spin.
AA also added that they remain on track with their strategic plan, as the firm looks to consolidate their status in the market.
The firm said “In line with management expectations we have successfully stabilised the decline of the paid membership base, which returned to growth during the second half of the year. This led to a broadly flat paid membership base year-on-year. We expect the growth in the second half of FY20 to continue into FY21 in line with previous guidance.”
For the year ended January 31, 2019, AA generated £341 million in trading Ebitda on revenue of £979 million. Pretax profit remained around £53 million.
Simon Breakwell, Chief Executive Officer, commented:
“We look forward to delivering full year results in line with market expectations, with growth in Trading EBITDA and strong free cash flow generation. In Roadside, we continue to deliver best-in-class customer service and have returned our paid membership base to growth. Our B2B business is performing well with strong renewal rates as well as new wins. Our focus in B2B remains building accretive long-term partnerships utilising our operational scale, service excellence, and innovative approach to customer solutions. Lastly, the Insurance business is delivering strong rates of profitable policy growth, and we expect this to continue next year.”
AA are set to publish their full year results on 31st March 2020, and will carry an optimistic tone for shareholders.
Shares in AA trade at 46p (+2.26%). 11/2/20 14:39BST.
Cranswick acquire Buckle family’s pig farming and rearing operations
Cranswick Plc (LON:CWK) have expanded their pig processing business with a new acquisition on Tuesday.
The firm said that it has acquired a pig farming and rearing business in the UK, which forms part of its plans to grow and expand into other sectors.
Shareholder should be pleased with the move by Cranswick as this should allow a more pragmatic approach to production and streamline costs.
The firm said: “Following the acquisition of Packington Pork in December, which specialises in British free range and outdoor pigs, today’s transaction further increases Cranswick’s self-sufficiency in UK pigs processed to over 30%. The transaction reinforces Cranswick’s commitment to a sustainable and traceable farm to fork operation, in line with its Second Nature strategy.”
Cranswick have acquired the Buckle family’s pig farming and rearing operations, as well as the family’s 50% share of the White Rose Farms Ltd pig production joint venture.
This joint venture was set up by Cranswick and the Buckle family in 2018. These operations currently run in Lincolnshire and Yorkshire.
Adam Couch, CEO of Cranswick, commented:
“I am pleased to announce today’s transaction, which further reinforces our strategic commitment to supporting and growing the British pig farming industry. We have worked with the Buckle family for over 25 years and we are delighted to welcome Rick, as Managing Director of White Rose Farms, and the wider team to Cranswick.”