UK employment data: CEO of IW Capital comments
News emerged only yesterday that UK unemployment has reached its lowest rate since the three month period to January 1975.
Indeed, the Office for National Statistics said that the unemployment rate reached a low of 3.8%.
However, the employment rate reached a record high of 76.2% in the three months to October 2019, according to the statistics.
Luke Davis, CEO of SME finance provider IW Capital, provided a comment on the news, focusing on the role played by small and medium-sized enterprises.
SMEs make up 99.9% of all private sector firms across the UK, accounting for 16 million jobs.
Data from the Office for National Statistics shows that SMEs have created jobs at a rate which is three times higher than that of larger businesses over the past five years.
“The ambition of small business in the UK has undoubtedly contributed to this record level of employment that we are currently seeing,” Luke Davis said.
“SMEs have been incredibly resilient to political uncertainty in the last three years and have continued to pursue growth and scaling opportunities wherever they can,” the CEO continued.
“We have seen more demand for growth finance than ever before as innovative firms look to add to their team and expand. Recently, we provided funding for a small business based in the North East directly to help them hire more talented people in order to develop their business proposition.”
“With this in mind, alternative finance availability will be a key driver to future employment records – the ambition is there, now is the time to support it.
With last week’s general election out of the way, UK politics can now turn its attention back to the nation’s departure from the European Union.
Will the government be able to put an end to the political and economic uncertainty which has dominated since the original Brexit referendum?
UK house prices grow by smallest amount since 2012
UK house prices grew by the smallest amount since September 2012, new data revealed on Wednesday.
Indeed, the Office for National Statistics said on Wednesday that UK average house prices grew by 0.7% over the year to October 2019, amounting to £233,000.
The Office for National Statistics said that, over the past three years, there has been a slowdown in UK house price growth, caused mainly by a slowdown in the south and east of England.
In England, average house prices grew over the year by 0.5% to £249,000. Meanwhile, in Wales they grew by 3.3% to £166,000, in Scotland they were up by 1.4% to £154,000 and in Northern Ireland average house prices saw a growth of 4% to £140,000.
The lowest annual growth was seen in the nation’s capital, where London prices dropped by 1.6% over the period.
“While house prices in London continued to fall over the year, the area remains the most expensive place to purchase a property, at an average of £472,000. The North East continued to have the lowest average house price at £129,000 and is the only English region yet to surpass its peak before the economic downturn,” the Office for National Statistics said.
Elsewhere, the GBP/USD has been able to hold on to recovery above 1.3100.
“We are observing a big reversal in sterling’s post-election gains in response to news that PM Boris Johnson intends to legislate against the possibility of extending the Brexit transition period, which is due to finish at the end of 2020,” Petr Krpata, CFA, Chief EMEA FX and IR Strategist at ING Economic and Financial Analysis, provided an analysis.
“Leaving without a trade deal at the end of next year is much the same as a hard Brexit and that’s clearly negative for sterling,” he continued.
With the general election out of the way, UK politics can turn its attention back to the nation’s departure from the European Union.
Brexit has caused both political and economic uncertainty, particularly to the UK property market.
Airline Industry wrap up – shares soaring, shares grounding and a lot of turbulence
The airline industry has seen mixed results by many firms, as shares have often been volatile.
As many firms have made it through what has been a tough year of trading across 2019, some have not been so lucky, and here is a round up of the biggest performances across the year.
Looking at the airline industry by firm, this gives us a better picture of how firms performed against tough market conditions, disruptions in supply lines and media image.
Ryanair
In the first quarter, Ryanair (LON: RYA) saw their profits fall by 21% in what was quite an uncharacteristic update from the airline titan.
The Irish low-cost airline said that for its first quarter of the 2020 financial year, profits dropped 21% to €243m, driven by lower fares, higher fuel costs and higher staff costs. Additionally, the budget airline said that average fares dropped 6% over the period.
“Our balance sheet is one of the strongest in the industry with over 60% of our fleet debt free. In May the Board approved a €700m share buyback programme and in Q1 we returned almost €100m to shareholders,” Ryanair’s Michael O’Leary said in a company statement. “Revenues rose 11% to €2.3bn. A 6% decline in average fare to €36 stimulated 11% traffic growth to 42m guests. The two weakest markets were Germany, where Lufthansa was allowed to buy Air Berlin and is selling this excess capacity at below cost prices, and the UK where Brexit concerns weigh negatively on consumer confidence and spending,” Michael O’Leary added.From this update, it seemed that this would be a tough start to the year for Ryanair, however recovery was made.
The firm then reported in June that it had seen a growth in passenger numbers of 13% totaling 14.1 million.
Numbers were boosted by an 8% growth at Ryanair, in addition to the 0.6 million passengers from the acquisition of Lauda, a subsidiary of Ryanair Holdings fully acquired at the start of the year.
At the start of October, Ryanair again saw their passenger volumes rise by 8%.
Passenger volumes for the month increased to 14.1 million, up from the 13.1 million figure recorded in 2018.
The most recent figure recorded was Ryanair’s November passenger figures, which again saw an impressive stat amid tough competition.
In the Ryanair division, November traffic rose by 4.0% year-on-year to 10.5 million from 10.1 million and in Lauda, by 67% to 500,000 from 300,000 last year.
It seems that from the results posted, RyanAir made a slow start to 2019, but have sufficed shareholders and senior management continuing to grow and put a foothold on the global market.
Shares in Ryanair trade at €14 (-2.51%) 17/12/19 14:16BST.
Wizz Air
Wizz Air Holding PLC (LON: WIZZ) have been another strong competitor in the airline industry, and certainly 2019 has been a year of success for the Hungarian low-cost airline with its head office in Budapest.
At the start of the year, Wizz Air saw its profit plummet amid rising costs, which alarmed both shareholders and the market.
The Hungarian airline reported a pre-tax profit €1.8 million, compared to €14.6 million a year before.
Cost per available seat kilometre increased by 9.3%, including fuel, whilst it climbed 4.3%. Alongside higher fuel prices, there was also a 22% rise in staff-related costs, with rises in pilot salaries during the quarter, which led to a plan to reduce costs from Wizz Air.
“The Company maintains its net profit guidance range of between €270m and €300m for the full year, where we will be within this range will depend on the extent of March yield pressures which will be affected year-on-year given Easter falls after the financial year-end in April and external factors such as Brexit uncertainty.”A few months on, Wizz Air announced that they would be expecting their full year profits to be at the upper end of guidance, which showed a strong few months of trading.
The Hungarian airline said that it expects to deliver a net profit for the year in the upper end of its guidance range of €270 million and €300 million. Notably, the firm saw a 22% rise in the number of passengers in May.
Wizz Air have seen their shares volatile, as experienced in November when shares were in red despite lifts to their profit and capacity forecast.
Wizz, which mainly flies to European destinations, said that net profit for the financial year 2020 would be between €335 million euros to €350 million, prior to this the range was €320 million to €350 million.
“London is the single biggest travel market in the world, and I don’t think this is going to change any time soon, no matter what happens to the country, what happens throughout Brexit.Finally, at a similar time to Ryanair Wizz Air also released their November passenger figures, which impressed the market.
Wizz Air reported a November capacity increase of 27% to 3.2 million from 2.6 million, while load factor rose 92.8% to 91.2%.
Available seat kilometres was up by 21% to 5.2 million from 4.3 million and revenue passenger kilometres grew by 4.9 million from 3.9 million in November 2018.
On a rolling annual basis, capacity is up 15% to 41.8 million, total passengers up by 17% to 39.1 million with load factor up 1.3 percentage points to 93.6%.
The verdict for Wizz Air is one of positivity, and certainly shareholders can remain optimistic for 2020.
Wizz Air announced that it would be adding 11 new routes, including four in Poland, two in Ukraine and one in the UK.
Additionally, the firm said yesterday that it would be expanding into Armenia in order to widen their consumer base.
Shares in Wizz Air trade at 3,994p (-0.88%). 17/12/19 14:24BST.
easyJet
Next up is easyJet (LON: EZJ) who have maybe seen more turbulence than their other two rivals.
The year did not start off easy for easyJet, who noted that the issues of drone flying at Gatwick airport cost the firm £15 million.
“With 82,000 customers disrupted we were disappointed it took such a long time to resolve. It was a criminal act, an illegal activity, and to some extent, you can’t always protect yourself from that,” said Johan Lundgren, the chief executive.
“We can never guarantee these things won’t happen again but the airports now are better prepared – Gatwick has acquired the sound system that is in place and there is general readiness and preparedness in place by the authorities,” he added.
At the start of April, the firm gave another update to the market saying that it had seen its outlook weakened by Brexit complications.
The company said in a statement that whilst the results from the first half will be in line with expectations, Brexit uncertainty is causing a weaker customer demand in the market. As a result, easyJet’s outlook for the second half of its financial year is more cautious, which sent an alarm to shareholders.
The most recent update that easyJet had given was in November, and this was one which would have worried both shareholders and senior management.
The firm announced that its headline profit before tax had plunged compared to the year prior.
EasyJet revealed that headline profit before tax declined 26% to £427 million. The airline emphazised, however, that this figure does lie towards the top end of its £420-430 million guidance range.
For the year ending 30 September, passenger numbers grew by 8.6% to 96.1 million.
“We have also invested in tackling disruption for our customers through our Operational Resilience programme, which has reduced cancellations by 46% and lowered delays of 3 hours or more by 24% year on year,” EasyJet’s Chief Executive continued.
To conclude on easyJet, 2019 has not been the easiest year for the firm in an environment where competitors have made gains.
However, shareholders can remain optimistic as the firm has seen itself flirt within the FTSE 100 list.
As it was reported at the start of December, Hiscox (LON: HSX) are set to drop out of the elite FTSE100 and Easyjet were the bookmakers likely candidate to replace them.
A few other mentions do have to be made when considering the airline industry this year.
Thomas Cook – a tribute
The biggest headline probably comes from Thomas Cook (LON:TCG) when the firm saw itself internally collapse at the end of September.
“News of Thomas Cook’s collapse is deeply saddening for the company’s employees and customers, and we appreciate that more than 150,000 people currently abroad will be anxious about how they will now return to the UK,” Richard Moriarty, Chief Executive of the UK Civil Aviation Authority, commented in a statement.
However, this was expected as the firm had been under intense pressure to survive. The firm did report in May that it had seen a £1.5 billion loss and that it was set to close 21 stores placing 300 jobs at risk.
Reactions hit social media after the collapse and TUI (LON: TUI) offered their condolences.TUI commented: “On Monday 23 September 2019, our competitor Thomas Cook UK Plc and associated UK entities entered into compulsory liquidation. TUI is preparing measures to support. Where TUI customers are booked on Thomas Cook Airlines flights and these are no longer operated, replacement flights will be offered. We are currently assessing the short term impact of Thomas Cook’s insolvency under the current circumstances, on the final week of our FY19 financial result.” “Our vertically integrated business model proves to be resilient, even in this challenging market environment. Our Holiday Experiences business continues to deliver strong results. Meanwhile, ourMarkets & Airlines business faces a number of ongoing external challenges such as the grounding of the 737 MAX aircraft, airline overcapacities and continued Brexit uncertainty. The Summer 2019 season is however closing out in line with expectations and we therefore reiterate FY19 underlying EBITA guidance stated in our ad hoc announcement of March 2019 of approximately up to minus 26% compared with underlying EBITA rebased in FY18 of EUR1,177m.” as the firm reached its conclusion. Shares of TUI trade at 976p (-1.41%). 17/12/19 15:10BST. Following the collapse of Thomas Cook, Hays Travel agreed to acquire 555 Thomas Cook (LON:TCG) stores around Britain. The country’s largest independent travel agent will also provide re-employment opportunities to a “significant number” of Thomas Cook’s retail workers. Hays Travel said in a statement that up to 2,500 jobs at the collapsed travel company could be saved as a result of the deal. “This is an extremely positive outcome, and we are delighted to have secured this agreement,” Jim Tucker, Partner at KPMG and Joint Special Manager of Thomas Cook’s Retail division, commented on the deal. “It provides re-employment opportunities for a significant number of former Thomas Cook employees, and secures the future of retail sites up and down the UK high street,” Jim Tucker continued. “We are pleased to have achieved this in a short time frame and in the context of a complex liquidation process, which is testament to a lot of hard work from a number of parties.” “Over the weeks ahead, we will work closely with Hays Travel and landlords to ensure a smooth transition of the store estate.”To help our friends at #ThomasCook, TUI Airways will bring home 473 holidaymakers from Tenerife and Turkey this evening. We keep our colleagues at Thomas Cook and its customers in our thoughts. And to our affected customers – please visit https://t.co/BhAyjcbP4X for updates. pic.twitter.com/r7FvPAyBzA
— tuiuk (@TUIUK) September 23, 2019
Fastjet
Additionally, Fastjet PLC (LON: FJET) have been fighting to stay afloat in an increasing tough market.
Fastjet had a relatively positive start to 2019, as the firm saw its shares in green following marginal 2019 profit forecasts.
During the first quarter of the year, Fastjet saw the group record an underlying net operating loss of around $200,000 on revenue of $9.5 million.
This proved an improvement from the $7.8 million loss reported on revenue of $13.8 million during the final quarter of 2018.
This optimism was followed through in July, when the firm seemed to be on track to produce a string of good results.
The Company’s revenues grew from little under $14.5 million to over $19.7 million; revenues from Fastjet Zimbabwe grew 19% to $12.1 million. Losses after tax narrowed from $14.6 million to just under $4.5 million.
Further, the Group announced that operating expenses were down $0.7 million on-year, and revenue per passenger was up 38% on the previous year.
Commenting on the results, Chief Executive Officer Nico Bezuidenhout said,
“It is pleasing to note the improved results for the first half, seasonally the weakest period of the year, as they illustrate the positive impact the Company’s stabilisation efforts have had on the financial performance of the business.”
“Key metrics such as revenue per available seat kilometre showed a year-on-year improvement of 39% in H1 2019; this is now 140% higher than the corresponding period in 2016.”
At the end of November, Fastjet appeared to be in a slump as the firm saw shares crash as it pondered the prospect of selling its Zimbabwe operations.
The firm said that it was considering selling its Zimbabwe operations in a restructuring deal. Fastjet added that profitability remained elusive amid Mozambique issues and tough market conditions.
On October 21, Fastjet announced it suspended flight operations in Mozambique amid “ongoing supply and demand challenges”.
During the first six months of 2019, revenue from Mozambique had fallen to $2 million from $4 million the year prior.
The firm said that the Zimbabwe sale would also relieve Fastjet off $5.4 million in debt and $3.2 million in future aircraft orders.
Fastjet have seen a very turbulent 2019, and at the moment it does seem to be on the path to recovery after a positive first half of the year.
Extra efforts will have to be made to turn fortunes around or 2020 could see a very tough year of trading for the airline.
Shares in Fastjet trade at 0.19p (-11.63%). 17/12/19 14:39BST.
International Airlines Group
A firm also worth mentioning is International Airlines Group (IAG) who posted a second quarter operating profit of €960 million before exceptional items in their second quarter.
“In Q2 we’re reporting an operating profit of €960 million before exceptional items, up from €900 million last year,” Willie Walsh, IAG Chief Executive Officer, said in a company statement.
“Despite fuel cost headwinds, we delivered a good performance. At constant currency, fuel unit costs were up 6.3 per cent while passenger unit revenue increased 1.1 per cent, benefitting from the timing of Easter,” Willie Walsh continued.
“This highlights, once again, that our unique structure and diverse brand portfolio underpins our financial resilience and ability to deliver robust results”.
Later in the year IAG saw their Q3 profits bruised by BA strikes.
International Airlines Group said that the industrial action by the pilots, in addition to other disruption, impacted operating profit by €155 million during the quarter.
“In quarter 3 we’re reporting an operating profit of €1,425 million before exceptional items, down from €1,530 million last year,” Willie Walsh, IAG Chief Executive Officer, said in a company statement.
“These are good underlying results. As we said in September, our performance has been affected by industrial action by pilots’ union BALPA and other disruption including threatened strikes by Heathrow airport employees,” the Chief Executive Officer continued.
The firm announced in November that it would be purchasing rival Europa Air, which caught shareholders attention in a deal worth €1 billion, giving IAG further exposure into the Spanish market.
Having carried 11.8 million passengers with its fleet of 66 aircraft during 2018, the Spanish private airline achieved full-year revenue of €2.1 billion and an operating profit of €100 million.
The acquisition has only just entered its initial phases, and completion is expected in the second half of 2020.
Iberia chief executive Luis Gallego said: “This is of strategic importance for the Madrid hub, which in recent years has lagged behind other European hubs. Following this agreement, Madrid will be able to compete with other European hubs on equal terms with a better position on Europe to Latin America routes and the possibility to become a gateway between Asia and Latin America.”
Finally, IAG ended the year on a modest note, when the firm cut its medium term profit and capacity expectations.
The heavyweight airline company scaled back profit and capacity forecasts for the next three years, hitting its outlook for earnings per share but potentially providing relief for rivals in a weak global economy.
IAG said available seat kilometres, a measure of passenger-carrying capacity, was estimated to grow by 3.4% a year between 2020 and 2022, compared to a previous forecast of 6% growth a year for the 2019-2023 period.
The airline group, which also owns Iberia, Aer Lingus and Vueling, said the capacity growth cut would lower its forecast for growth in earnings per share to 10%+ a year from a previous forecast of 12%+ a year.
IAG have seen a quieter year compared to rivals, but have been hit by political action and strikes, however this seems to be a relatively stable year for the firm. With the strong figures produced mostly all across 2019, coupled with some new acquisitions there is much optimism going into 2020. Shares of IAG slipped 2.09% on Tuesday to 626p. 17/12/19 15:10BST.Conclusion
Certainly the airline industry has seen turbulence, some brilliant moments and some gloomy ones too.
2019 has arguably been one of the toughest years not just for the airline industry but for all firms, with Brexit negotiations continuing to dominate news headlines.
The additional issues of US China relations and political tensions in Hong Kong have not made matters any better, however there is reason for firms to remain optimistic for 2020.
With the ongoing supply issues at Boeing (NYSE: BA) which have caused a halting of production of their 737 MAX aircrafts, this will give airline businesses something to ponder over.
Boeing made this announcement this week, and gave the following comments. “Boeing will continue to assess production decisions based on the timing and conditions of return to service, which will be based on regulatory approvals and may vary by jurisdiction.”However, there has been a continued domination from industry leaders such as Ryanair who have enticed customers with their dierse operational base coupled with their low costs, and it looks like Ryanair are far from finished.
Once political and economic tensions are eased up, firms may see a more sustained period of successful trading in 2020.
Senior shares fall over 9% following 737 MAX production halt
Shares of Senior plc (LON: SNR) have fallen over 9% on Tuesday afternoon, after Boeing (NYSE: BA) announced they would be stopping 737 MAX production.
Senior designs, manufactures and markets high-technology components and systems for the principal original equipment producers in the worldwide aerospace, defense, land vehicle and power & energy markets.
Last week, Senior announced that they would be working with Lazard Ltd on the potential divestment when it was reviewing its strategic options for its Aerostructures business.
Today, Senior said the announcement by client Boeing has sent their shares falling.
The firm tried to reassure shareholders that by saying it will provide concrete clarification in the new year on any performances that may be bruised by the production halt.
Senior said it continues to “work closely” with Boeing as the aerospace manufacturer seeks regulatory approval for returning its best-selling plane to the skies following a pair of fatal accidents.
“Senior will provide a further update on the potential implications to its 2020 performance once it has clarification from its customers,” the company added.
Senior continued: “The board’s expectations for the group’s 2019 performance remains unchanged.”
On Monday, Boeing announced that they will be temporarily suspending production of its its globally grounded 737 MAX jets next month as safety regulators delay the aircraft’s return to the skies after two fatal crashes in Africa and South East Asia.
The Federal Aviation Administration said that it could not approve the 737’s return to serviced before 2020, despite pledges from Boeing that that it could win approval before the year end.
Boeing and the Federal Aviation Administration have been under intense scrutiny and media spotlight for their responses to issues with the aircraft, including the flight-handling system involved in both accidents, the Maneuvering Characteristics Augmentation System.
The 737 Max has been hit under pressure as firms such as TUI (LON:TUI) reported that it may cost it as much as €300 million (£258 million), leading to the issuance of a profit warning when the 737 was grounded as consumers and businesses were hit.
Certainly, Senior will not be the only firm that is affected by this production halt.
Earlier in the year, International Consolidated Airlines (LON:IAG) announced that they ordered 200 737 MAX planes, and with the delay there has been a whole host of customers kicking down Boeing’s front door.
Senior shareholders will have to be patient as Boeing look to find compensation for both consumers and businesses hit by the production halt.
It seems that Senior shareholders were not too pleased however, as shares dipped 9.18% to 169p on the announcement. 17/12/19 13:51BST.
Roche completes $4.3 billion takeover of Spark Therapeutics
Roche Holding Ltd. Genussscheine (SWX: ROG) have told the market on Tuesday that they have completed the purchase of gene therapy specialist Spark Therapeutics Inc (NASDAQ: ONCE).
The deal is valued at $4.3 billion and the deal has been formally completed following clearance from the British and US competition authorities, and becomes Roche’s second acquisition in a short space of time following the recent deal with US based Promedior.
Regulators investigated the potential move to ensure that it will not lesson competition in the hemophilia A treatment market, however both the Federal Trade Commission and CMA approved the deal without demanding asset sales.
Roche has purchased US based Spark Therapeutics to expand in gene therapy and boost its market in hemophilia A, where Roche’s existing drug will surpass $1 billion in sales across 2019.
Spark is a relatively young company and has rivals such as Yourgene Health PLC who recently gave shareholders a confident expectation guidance to hit further growth for the full year.
Regulators had feared Roche might sabotage Spark’s hemophilia program to benefit Hemlibra, but came to another conclusion.
“The evidence developed during staff’s investigation did not indicate that Roche would have the incentive to delay or terminate Spark’s developmental effort for its hemophilia A gene therapy,” the FTC said after its 5-0 approval vote.
Regulatory clearance means that Roche will now likely become one of the market leaders in the treatment of hemophilia A.
Roche is making a real statement to the pharmaceuticals market, after the loss it saw in the immune therapies for cancer when both Merck (NYSE: MRK) and Bristol-Myers Squibb Co (NYSE: BMY) eclipsed it recently.
The firm has followed similar line as rivals to make an ensured effort to divulge into the gene therapy market. Notably, industry rival Novartis recently acquired AveXis, hence the move by Roche comes at no surprise, in order to keep up with rivals.
“That’s why the market was increasingly worried that the deal announced in February was taking so long,” said Michael Nawrath, an analyst at Zuercher Kantonalbank.
Roche have agreed to pay more than twice of what Spark’s closing price was, and as of today Roche holds more than 60% of Spark shares.
“Following completion of the merger, Spark will become a wholly owned subsidiary of Roche,” Roche said.
Shares in Roche trade at 303CHF (-0.31%). 17/12/19 13:19BST.
GSK set to rival Johnson & Johnson for multiple myeloma drug
British pharmaceutical firm GlaxoSmithKline (LON: GSK) have said on Tuesday that they are seeking US approval for a multiple myeloma drug.
GSK have seen a relatively stable 2019, with the firm reporting strong trading figures throughout the year.
Most notably, GSK reported a lift in their lift in their annual profit forecasts as the firm impressively told shareholders that turnover rose 11% to £9.39 billion in the three months ended Sept. 30 from a year earlier.
Additionally, last week the firm saw its shares boosted as GSK told the market about the submission of a new drug application to the US Food & Drug Administration, seeking approval of fostemsavir, through ViiV Healthcare.
ViiV Healthcare is majority owned by GSK, with rival firms Pfizer Inc and Shionogi Ltd as a minority shareholders.
In similar fashion to last week, GSK said that it had applied for US approval for its experimental multiple myeloma drug which had shown positive results in almost a third of patients.
This certainly is an interesting move by GSK, as rivals Johnson & Johnson (NYSE: JNJ) offer a similar type of drug, which could set up a war between the two pharmaceutical titans.
New data from the treatment, belantamab mafodotin, showed 30 of 97 patients experienced a reduction in their myeloma cells at the end of a mid-stage study, DREAMM-2.
The trial was testing GSK2857916, in patients who had received four to seven prior other treatments, including J&J and Genmab’s (CPH: GMAB) Darzalex.
GSK has submitted a marketing application to the U.S. Food and Drug Administration (FDA) in the 2.5 mg/kg dose. If approved, belantamab mafodotin would be the first anti-B-cell maturation antigen (BCMA) agent available in the United States, the company said.
Belantamab mafodotin targets the BCMA protein in cells characteristic of multiple myeloma – an area of focus for many drugmakers.
Axel Hoos, GSK’s oncology research and development head, said the rate of response – or the number of patients that experience a reduction in myeloma cells – should go up with every earlier cycle of treatment.
“We are pretty confident that we can actually achieve the same (response rates) if not more and eventually even beat Darzalex in some settings,” he said.
Shares in GSK were 0.15% to the good on Tuesday afternoon and trade at 1,766p. 17/12/19 12:57BST
Greatland Gold identify mineralization in Tasmania
Greatland Gold plc (LON: GGP) have seen their shares dip on Tuesday, despite reporting gold mineralization in Australia.
A fortnight ago, the firm saw its shares dip in similar fashion. In this update on December 3, the firm said that the results extend the zones of existing high grade mineralization at their licence.
Greatland added that, Newcrest Mining Ltd (ASX: NCM), which carried out the work at Havieron, has finished a $10 million first stage of a farm-in agreement, and a second stage also worth $10 million of expenditure has now begun.
Greatland have said today that further drilling at its wholly owned Firetower project in Tasmania confirmed the presence of additional broad widths of shallow gold mineralisation.
The firm said it completed a systematic grid-based drilling programme at Firetower, comprising 14 diamond holes with depths from 50 metres to 160 metres, for a total of approximately 1,530 metres.
The programme was designed to test the main zone of gold mineralisation and results to date have confirmed broad widths of gold mineralisation, Greatland said.
In addition, two further holes were drilled for around 670 meters to test the new targets identified by a 3D induced polarisation survey at Firetower East, approximately 500m east of Firetower.
Gervaise Heddle, chief executive officer, said: “We are pleased to report a second set of positive results from our recent drilling campaign at Firetower. They show a further improvement in the continuity between drill sections and highlight the potential for a robust, near-surface gold system.”
Back in September, the company had said that initial drill results from Firetower had confirmed “broad widths of gold mineralisation”.
Initial results included 54.5 metres at 1.4 grammes of gold per tonne of ore from surface, including 5 metres at 5.4 grammes per tonne from 45 metres.
Greatland Gold will be pleased that they have reported further positive results, although shareholders do not seem so keen on the announcement following this mornings stock price movement.
Fellow Australian gold miner Resolute Mining Limited have appointed a new CEO yesterday, in an attempt to stimulate business in a tough environment and look to develop discovery and mining operations to keep up with competitors such as Greatland
Resolute appointed Stuart Gale rom Australian iron ore company Fortescue Metals Group Ltd where he was group manager for Corporate Finance for nine years since 2010.
Resolute in similar Fashion to Greatland have seen results and discoveries made in Australia, and both firms will be hoping that operations can be enhanced going into 2020.
Shares in Greatland trade at 1.75p (-3.58%). 17/12/19 12:38BST.
deVere Group CEO gives warning to British business despite Boris Bounce
Today, CEO of one of the worlds largest independent financial advisory organizations in deVere Group has given a warning to British business, despite the Boris Bounce and Brexit.
The FTSE 100 saw a very strong start to the week of trading yesterday, as all firms bar four saw their shares boosted across Monday trading.
Dubbed the ‘Boris Bounce” many firms saw their shares rally after the landslide Conservative win on Friday.
Notable winners included the British Banking business sectors where Lloyds shares have jumped 6.4% to 65p on the election results.
Additionally, Barclays PLC shares rallied 7.77% to 185p on Friday, whilst Royal Bank of Scotland Group plc saw their shares spike 10.69% to 257p.
Another noteworthy winner was the homebuilding sector, where many businesses saw shares in green.
Taylor Wimpey saw their shares rally 14.88% to 200p, who happened to the biggest rise on Friday.
Berkeley Group Holdings PLC (LON: BKG) shares spiked 13.06% to 5,102p despite the timid update provided a few days ago.
However, it seems that the optimism from Friday’s election results is beginning to fade as markets restore normality and businesses continue to see their shares up and down.
Nigel Green, chief executive and founder of deVere group said that PM Johnson could spook financial markets in 2020.
Green added that investors must avoid complacency in what still seem to be uncertain times for British business.
Nigel Green affirms: “The decisive win for the Conservatives triggered one of the pound’s biggest ever rallies, the FTSE 250 index of UK shares climbed by 3.6 per cent and the FTSE 100 rose 1.3 per cent. “On Monday, European stock markets reached all-time highs. “This has been driven in part by investors’ relief that a hung parliament had not been delivered, meaning years of uncertainty and indecisions over the UK’s way out of the EU is coming to an end. Also, perhaps, because the Conservatives promised a more pro-business agenda.” He continues: “But Boris Johnson now has the daunting task of turning his powerful election campaign slogan of ‘Get Brexit Done’ into reality. “When Britain leaves on January 31, there will be only 11 months to thrash out the basics of the future relationship with the European Union. “The self-imposed end of December 2020 deadline is a mammoth challenge or Britain will fall through the ‘trap door’ of no-deal Brexit on January 1 2021.” The Prime Minister could request another extension for the transition period. The government has until 1 July 2020 to agree with the EU a one-off extension, until the end of 2021 or 2022. But, says Mr Green, this is unlikely. He notes: “I don’t believe that Johnson will use his significant majority to slow down or soften – the Brexit process. “Instead, his assumption from the election outcome will be that people want quick, easy answers. “Indeed, in an interview on Sunday, Michael Gove guaranteed that the Brexit transition period will not be extended.” He goes on to add: “The task ahead is monumental. The time frame in which to complete it is narrow. Failure to agree a free trade deal by the end of next year will mean the UK crashing out of the EU and all the far-reaching negative economic implications, including the likelihood of a recession. “With such uncertainty, following the election bounce, in 2020 investor confidence in the UK is likely to remain subdued and Boris Johnson’s Brexit stance could be a major source of volatility in financial markets.” The deVere CEO concludes: “Despite the markets currently surging, investors must avoid complacency. “2020 promises to be a year in which political factors – including Boris Johnson’s Brexit plan and the U.S. presidential election, amongst others – could potentially spook markets. “Investors should assess and, where necessary, rebalance their portfolios to take advantage of the potential opportunities and to mitigate the risks.” The risk to investors is still present, and despite some of the clarity which has been given following the UK election results, many issues are still cloudy. As Brexit negotiations will continue to unfold as the newly elected Conservative Government tackles these issues, the market will be cautious as nothing is certain as of yet.Hunting hedge their bets on December performance to meet annual results
Hunting PLC (LON: HTG) have said that they expect annual profits to remain within their current market expectations, but are dependent on results in December.
Hunting manufacture premium, high end downhole metal tools and components required to extract hydrocarbons across the well construction, completion and intervention stages of the well’s lifecycle.
Shares in Hunting were bruised on Tuesday morning after the announcement, and trade at 383p (-6.19%). 17/12/19 11:47BST.
Hunting saw their shares in red a the end of October, as the firm speculated on lower profits following a US drilling slowdown.
The FTSE 250 listed energy company said that its third-quarter underlying profits had dropped below the $35 million and $42.4 million it had boasted in the first and second quarters respectively.
Again the firm today has seen its shares in red, as the firm hedged its bet on a solid December performance to allow it to meet guidance.
Hunting said, as anticipated, activity levels within the North American oil and gas industry continues to slow, with the pace of decline increasing in the US onshore market.
Further, the oil and gas contractor said “exhaustion” within its client base together with seasonal declines are hurting its fourth quarter results and “certain clients have closed facilities serving the US onshore sector due to the slowing market”.
Hunting added that operating profit and revenue in both October and November were below the average rate for the third quarter of the financial year due to the “slowing and highly competitive” US onshore market.
Hunting however did reassure shareholders saying that it continued to trade well and remained cash generative.
It expects to have around $110 million of cash at the end of the year, with $45 million of lease liabilities – resulting in a $65 million net cash position.
Hunting allude to the offshore and international oil market facing a slowdown, however there was a return to growth as Hunting Electronics business reported firm results.
Looking ahead to 2020, the company said: “At this time early announcements from Hunting’s publicly quoted clients indicate that capital spend in the year ahead will be lower than 2019, as the oil and gas industry endeavours to improve returns and increase cash generation for investors.”
In similar fashion to Hunting, fellow American operator Active Energy have seen their operations have stops and starts over the last week.
The firm said that it had begun it commercial production in Lumberton, North Carolina after the North Carolina Department of Environment & Natural Resources is continuing to review its application to operate.
At a time where oil prices continue to be volatile, and market trading is being hampered by both political and economic variables shareholders will hope that Hunting can pull out a strong set of results in December.Trainline keeps its annual guidance as sales rise
Trainline PLC (LON: TRN) have given shareholders a positive update saying that they are keeping their annual guidance.
Trainline saw their shares dip at the start of December, as Jeremy Corbyn and the Labour party announced travel policies to rival Trainline.
The Daily Mail reported that the Labour government would would create a ‘one-stop shop’ for rail passengers to buy tickets online without booking fees, the Mail reported without citing its sources.
This came as part of Labour’s business and travel policy where it was also mentioned that it had intentions to nationalize BT (LON: BT.A) in an attempt to win voters.
However, looking back now knowing the election result it seemed that neither of these policies won voters.
Today, Trainline reiterated their annual guidance as the firm continued to deliver strong growth in ticket sales and revenue.
Within the nine months to November 30, Trainline’s climbed 26% to £198 million, with UK revenue up 22% to £178 million and International rising 90% to £20 million.
Revenue from the UK consumer segment climbed 31% to £133 million, though Trainline for Business revenue in the UK was flat at £45 million.
Trainline did note there was a slowdown in the third quarter of its year as large corporations cut discretionary travel spending.
Trainline offers a rail and coach ticket purchase platform saw net ticket sales of £2.86 billion within the none months, seeing an 18% climb year on year.
In the UK, net ticket sales were up 14% to £2.47 billion, with International climbing 49% to £390 million.
UK consumer net ticket sales rose 24% to £1.54 billion, with business sales rising 2% to £930 million.
Trainline praised the development of online ticket sale growth driven by demand from mobile users, as customer shift from paper to e-tickets.
Chief Executive Clare Gilmartin said: “We continued to deliver strong growth in the third quarter of the financial year while we focus on our mission to make rail and coach travel easier for customers worldwide, encouraging a much greener way to travel.
“We are on track to deliver our plans for the full year and will continue to invest both in the UK and internationally to deliver the significant growth opportunities for Trainline in the year ahead.”
Trainline remained optimistic for its guidance encompassing its financial year, which ends in February.
Trainline are now performing well in a market which is appearing to be in a period of tough market trading, as evidenced by rival FirstGroup who saw their shares in red as the firm considered selling their North American operations yesterday.
Shares of Trainline trade at 507p (-0.59%). 17/12/19 11:38BST.