EasyJet, Delta and Italy’s state controlled railway discuss Alitalia rescue deal
EasyJet (LON:EZJ) announced on Thursday that it has entered in discussion with Delta Air Lines and Ferrovie dello Stato Italiane to form a consortium to rescue carrier Alitalia.
Ferrovie dello Stato is Italy’s state controlled railway. It will start negotiating with the two airlines to form a rescue plan for struggling Italian carrier, Alitalia.
Alitalia has been under special administration since 2017. This is following the rejection of a rescue plan by workers, preventing the airline from raising new financing from its shareholders. The Italian airline currently has a £789 million state loan, but it is seeking international partnerships in order to survive.
Italy’s Ferrovie dello Stato announced a statement outlining that both Delta and EasyJet had confirmed their interest in forming a rescue deal with the railway group. Delta confirmed that it has submitted a “general and non-binding letter of interest” to Ferrovie dello Stato. Though EasyJet did release a statement confirming its interest, it has emphasised that there was “no certainty at this stage that a transaction will proceed”.
German airlines group Lufthansa also expressed interest in rescuing Alitalia in January. It held talks to acquire a majority stale in the airline, expressing interest to fully take over the company long-term.
Last November, EasyJet revealed that it had seen a successful year, with annual profits growing in-line with expectations. Equally, results indicated that 88.5 million passengers flew with the low-cost airline throughout the year. It was heavily hit, however, by the recent drone-induced chaos at Gatwick. The Gatwick drone sightings cost the airline £15 million. This is split between £10 million in customer welfare costs and a £5 million loss in revenue. Despite the financial hit of the drone sightings, EasyJet’s trading update expressed positive news and confidence amid the UK’s uncertain departure from the European Union.
At 09:56 GMT Thursday, shares in EasyJet plc (LON:EZJ) were trading at +0.62%.
Though the market is still closed in the US, shares in Delta Air Lines Inc. (NYSE:DAL) closed yesterday trading at +1.04%.
AstraZeneca meets guidance as new medicines lead strong performance
AstraZeneca (LON:AZN) announced on Thursday that it saw a “very strong” fourth-quarter performance, boosted by new medicines. As a result, the drug maker has emphasised its return to growth as it meets its guidance.
Product sales growth for the fourth-quarter jumped 5% to $5.77 billion.
For the full financial year, revenue dropped 2% to $22.1 billion and product sales increased 4% to $21.05 billion. This remains in-line with guidance of a low-single-digit growth.
Moreover, earnings per share fell 19% to $3.46 per share, which is towards the upper end of guidance for earnings of $3.30 to $3.50 per share.
Core earnings were up 22% to $1.58 per share.
Oncology sales soared 50% to $6.04 billion as the performance of new drugs led growth.
For the next financial year, AstraZeneca anticipates that core operating profit will increase, ahead of product sales, by a mid-teens percentage. Additionally, capital expenditure is set to be broadly stable. Core operating expenses are expected to increase by a low single-digit percentage.
In October, AstraZeneca announced that its third-quarter earnings had dropped and underscored its Brexit contingency plan.
Chief Executive Officer Pascal Soriot commented on the results: “Closing the year with another strong quarter, our performance confirmed that AstraZeneca has returned to growth. Our new medicines performed particularly well across the therapy areas and the Emerging Markets business went from strength to strength. 2019 will be a year of focus on continued pipeline delivery and flawless commercial execution. The performance of our new medicines demonstrated the ability of our commercial teams to convert the pipeline into successful medicines.” “As we recently entered a new phase in our strategic development, we have refined our organisation to position ourselves for the next phase of our journey. The changes are designed to further integrate research and development and accelerate decision-making and the launches of new medicines, consolidating what we believe is already one of the most exciting and productive pipelines in the industry. We are also enhancing our commercial units to increase collaboration with our R&D organisation, enabling greater commitment to our main therapy areas; we want AstraZeneca to be more agile, collaborative and focused as we enter a period of sustained growth.” “Our strategy and plans remain unchanged, with sales growth and a focus on cost management anticipated to drive growing operating profit. I’m pleased that we are fully on track to meet these commitments as we build a sustainable level of growth and a pipeline that is benefitting more and more patients around the world.” Earlier this month, AstraZeneca’s treatment for a rare disease was granted orphan status. During the 2018 financial year, it sold its US rights to its respiratory tract infection treatment to the Swedish company Sobi. Additionally, it sold its European rights to an acid-reflux medicine to Grunenthal. At 09:23 GMT Thursday, shares in AstraZeneca plc (LON:AZN) were trading at +4.07%.Moneysupermarket.com reveals 8% full-year revenue increase
Moneysupermarket.com (LON:MONY) announced its preliminary results on Thursday for the year ended 31 December 2018. Indeed, the British price comparison website posted an 8% rise in revenue as it significantly progressed its strategy in accelerating growth. Shares in the company were up by almost 5% during early trading on Thursday morning.
Group revenue was up 8% to £355.6 million compared to £329.7 million the year prior.
Operating profit was £108 million, a 14% jump compared to £94.9 million from the previous year.
Adjusted EBITDA was £129.4 million, 2% higher than the £127.2 million figure from 2017.
Total dividend was up 6% to 11.05p per share, reflecting its “progressive” dividend policy.
During the beginning of the 2018 year, Moneysupermarket.com reported a 4% growth in revenue for the first-quarter.
The results confirmed that the price comparison service was on track for the rest of the year. CEO of Moneysupermarket.com, Mark Lewis, commented on the results: “In 2018 we made great progress on our Reinvent strategy. As well as growing the business we helped save customers a record £2.1bn. Our investment in optimising our sites means we have made saving even easier.” “In 2019 we are taking price comparison to the next stage by offering people more personalised ways to save and on more of their household bills.” But, though the company has said that its markets remain “dynamic” and “healthy”, it has predicted that its core market will grow 4-5%, below its previous estimate. It now expects a later recovery to motor insurance premium inflation, the company warned. Looking ahead, the company has said it is “confident” that it will deliver market expectations for the new year amid an “encouraging” first six weeks. In addition to the results, the company also revealed a directorate change. It has been announced that Robin Freestone will be appointed Chairman of the company’s board. At 08:51 GMT Thursday, shares in Moneysupermarket.com Group plc (LON:MONY) were trading at +4.85%.Tullow books profit and reinstates dividend
Tullow Oil Plc (LON:TLW) have announced a shift to an annual profit after a hike in revenues. The news has allowed the oil and gas exploration firm to reinstate its dividend for its shareholders.
The latest round of results announced that the company had produced 88,200 barrels of oil per day, and this informed their guidance for 2019, which stands at 94,000-102,000 bpd.
Tullow recorded a climb in revenues of 7.9% to $1.86 billion, with write-downs and costs – for instance impairments of property, plant and equipment – down from $539 million to $18 million on-year.
As a result, the company were able to post a pre-tax profit for the full financial year through December, with a figure of $85 million, up from negative $175 million the year before.
In response to a change in strategy, Chief Executive Paul McDade said,
“Tullow has worked hard over the past few years to become a self-funding, cash-generating business with a robust balance sheet, low-cost assets and a rigorous focus on cost and capital discipline,”
“This has allowed us to set a clear capital returns policy which will start with the 2018 final dividend announced today.”
“Our high-margin producing assets in West Africa, substantial development assets in East Africa and exploration licences in industry hotspots provide Tullow with a strong foundation for growth in the years ahead.”
Tullow as a portfolio candidate
The company announced a dividend of 4.8c per share, with share prices rallying in Wednesday trading, up 8.2p or 3.89% to 219.2p per share 13/02/19 17:09 GMT. Analysts from RBC Capital Markets have upgraded their stance on Tullow stock from ‘Sector Perform’ to ‘Outperform’, while Barclays Capital downgraded their rating from ‘Overweight’ to ‘Equal Weight’ and Morgan Stanley reiterated their ‘Overweight stance’.Serabi Gold maintains guidance despite miner fatality
Serabi Gold maintained its production guidance in an operational update released on Wednesday, despite a miner fatality halting operations.
The gold mining and development company said January gold production would be 3,671 ounces.
Serabi Gold added that its cash position at end of the month was $12.8 million.
It also said that a Geological Resource update drilling was close to completion at Coringa. The update is set to be published in March and June of this year.
Chief Executive Officer Mike Hodgson commented: “We are delighted to have started the year in much the same way as 2018 ended, with excellent production…”
He added: “At Coringa, we are close to concluding a drill programme, the results from which will be included in the resource update. As reported at the end of January the results to date have been excellent. We remain on schedule to publish an updated geological resource estimate before the end of the first quarter, and will follow this up with the preparation of a PEA, the results of which are expected to be available before the end of June 2019.”
On Tuesday, Serabi Gold issued a statement regarding a miner fatality at its Palito gold mine in Brazil.
As a result, production had been halted in anticipation of the outcome of an investigation by the police and the relevant authorities.
Serabi Gold’s operations are focused in Brazil. Its projects include The Palito Mining Complex and Coringa Gold Project.
Shares in Serabi Gold (LON:SRB) are up +9.59% as of 12:51AM (GMT).
UK inflation dips to 1.8% in January
UK inflation dipped to 1.8% in January as a result of falls in electric, gas and fuel prices, according to the latest official figures.
The Office for National Statistics (ONS) said that the introduction Ofgem’s energy price gap helped ease inflation over the period.
This marks a two-year low for inflation, and below the Bank of England’s target of 2%.
Mike Hardie, ONS head of inflation, said: “The fall in inflation is due mainly to cheaper gas, electricity and petrol, partly offset by rising ferry ticket prices and air fares falling more slowly than this time last year.”
https://platform.twitter.com/widgets.js UK inflation levels have been falling since reaching a six-month high of 2.7% in August. In December, inflation fell to 2.1%, casting doubts on an impending rate hike by the Bank of England. Indeed, earlier this month, The Bank of England’s Monetary Policy Committee unanimously opted to hold interest rates, after downgrading its economic outlook to 1.2% of GDP. This central bank had previously forecast growth of 1.7% back in November.The CPIH 12-month rate was 1.8% in January 2019, down from 2.0% in December 2018 https://t.co/mJHB1j4pH9 pic.twitter.com/xn5SjaV7wA
— ONS (@ONS) 13 February 2019
Dunelm shares rise amid half-year profit boost
Dunelm reported its interim results on Wednesday, with a boost in like-for-like sales sending profits higher.
The FTSE-250 furniture maker said pre-tax profit for the six months to 29 December, was £70 million, an increase of 16.7% year on year. The company also said it had free cash flow of £91.2 million.
Accordingly, Dunelm increased its interim dividend increased by 7.1% to 7.5 pence per share.
Brexit
Alongside updated the market on its interim results, Dunelm also revealed it has commenced stockpiling some of its best-selling items ahead of Brexit.
Whilst the company said it imports less than 1% of its goods from EU countries, it said it had nonetheless ‘identified some risks arising from potential disruption at ‘deep-sea’ ports in the period following exit’.
Dunelm also said that approximately 2.5% of employees are EU nationals, and that the company will support its employees obtaining ‘settled status’ when needed.
Nick Wilkinson, Chief Executive Officer, commented:
“It’s been a good first six months with our strong performance reflecting the focus we have placed back on the core Dunelm business. The like-for-like revenue growth, both in stores and online, demonstrates the progress we are making in improving our multichannel proposition whilst maintaining the breadth and depth of our specialist customer offer in homewares. On top of this, good operational discipline and keeping things simple, is driving a better financial performance.”
“We traded well through our key Winter Sale period and remain pleased with our performance to date. As previously highlighted, we are cautious about the outlook for the remainder of the financial year due to the continuing political uncertainty in the UK. We are confident in delivering market expectations(5) for the full year assuming no material change in the macro-economic environment.”
“Looking to the future, we will continue to grow the business as we become a truly multichannel homewares destination, making Dunelm the first choice for even more customers, and further strengthening our market leading position.”
Dunelm shares are currently trading +3.21% as of 11:23AM (GMT).
Bushveld Minerals shares rise after Imaloto update
Bushveld Minerals (LON:BMN) issued an operational update on its subsidiary, Lemur Holdings, sending shares up.
The company said it has finished reviewing the power part of Imaloto, and has now commenced evaluating the coal mine aspect.
Bushveld Minerals also said that it had completed due diligence for the project preparation finance with a lender, and continues to engage with lenders on project financing.
Lemur Holdings is the company’s coal and power subsidiary.
Prince Nyati, CEO of Lemur Holdings Limited, commented:
“The completion and review of the Bankable Feasibility Study for the power component of the Imaloto Project represents a key milestone achieved as we press ahead in ensuring Lemur delivers on the potential of the Imaloto Project. The Project’s bankable feasibility study shows that the Imaloto Project is feasible and can deliver significant economic returns. More importantly, the Imaloto power project is the most advanced Independent Power Project (“IPP”) baseload project in Madagascar.
He continued: “It will have transformational developmental benefits for the country’s southwest region, where the government has already implemented significant road infrastructure expansion. The coal reserve and transmission line is capable to support the generation capacity in excess of 60MW in the medium to long term as suppressed demand is unlocked in the region.
Bushveld Minerals is a vanadium producer. The firm is listed on the AIM-market of the London Stock Exchange. Its operations are focused in South Africa and Madagascar.
Shares in Bushveld Minerals are currently +1.74% as of 10:41AM (GMT).
Shefa Yamim: Preparing for diamond and precious stone production
Shefa Yamim (LON:SEFA) is targeting gem stone prospects in the Kishon region of Northern Israel, in particular diamonds, sapphires and ruby.
The company has recently hit significant milestones such as the recognition of a new mineral in their Carmel Sapphire and a technical economic evaluation that puts their mining process towards the lower end of costs when compared to their peers.
Michael Rosenberg of Shefa Yamim presented at the UK Investor Magazine Investor Evening 31st January and detailed this year’s plans and their pursuit of a mine-to-market strategy.
Nissan cuts profit forecast amid Ghosn scandal
Nissan cut its profit forecast for the year ahead as the Japanese car company continues to suffer the fall-out from the Ghosn scandal.
The car-maker revised its 2018 operating profit forecast to be 450 billion yen (£3.2 billion), down from 540bn yen, citing weaker car sales.
It now expects revenues of 11.6 trillion yen, as opposed to 12 trillion yen.
Nissan reportedly sold 4.02 million vehicles over the course of the first nine months of the year, marking a fall of 2.1%.
Whilst the firm enjoyed growth in Japan, China and other markets, Nissan suffered a decline in sales across America and Europe.
Nissan is also facing a one-off compensation charge of 9.2 billion yen (£64.7 million) to former chief executive and chairman Carlos Ghosn between 2009 and 2017.
Ghosn was initially arrested on suspicion of underreporting his pay between 2011 and 2015.
In December, Mr Ghosn was re-arrested by Japanese authorities on suspicion of aggravated breach of trust.
Since 1999, Nissan has been a member of the Renault-Nissan-Mitsibushi Alliance, of which Mr Ghosn had been a key proponent.
At the time of his initial arrest, Nissan released the following statement, stating that Ghosn had been “reporting compensation amounts in the Tokyo Stock Exchange securities report that was less than the actual amount, in order to reduce the disclosed amount of Carlos Ghosn’s compensation”.
“Numerous other significant acts of misconduct have been uncovered, such as personal use of company assets, and Kelly’s deep involvement has also been confirmed.”
“Nissan deeply apologises for causing great concern to our shareholders and stakeholders. We will continue our work to identify our governance and compliance issues, and to take appropriate measures.”
Shares in the company (TYO: 7201) are currently trading +1.87% as of 14:32PM (GMT).