Premier African Minerals shares spike on Cadence investment
Premier African Minerals Ltd (LON:PREM) saw their share price boom following 5.1 million USD investment from Cadence Minerals Ltd (LON:KDNC).
As markets opened this morning, their share price rallied from 14-27p, and then leveled out again at 24p – signifying a growth of 74.07 percent.
The news came after a conditional heads of terms deal was struck with their counterparts, Cadence Minerals, who have acquired a 30 percent stake in Premier African Minerals’ wholly owned subsidiary, the Zulu lithium and tantalum project.
“This conditional HoT with Cadence underlines the value and potential of the Zulu project, with a post-investment value of $17-million, reaffirming Premier’s belief that the project is potentially one of the leading hard-rock lithium exploration projects on the London market”, said PAM CEO, George Roach.
The 5.1 million USD from Cadence will be used to fund the definitive feasibility study on the Zulu project – this following a scoping study last November, which reported an estimate of 20 million tonnes of mineral resource.
In addition to the recent investment from Cadence, PAM have secured a 300,000 USD loan from a trust related to their CEO George Roach. The company have said they will repay the loan and fees in full, within five days of the loan’s maturity. The loan has been secured against the company’s shareholding of just over six million shares in ARC Minerals Limited (LON:ARCM).
Going forwards, PAM will carry out the Zulu project in Zimbabwe and take advantage of the recently changed political conditions in the country. Projections look promising, at least in comparison to other commodities and resource extraction firms in the market.The end goal is to turn the conditional heads of term into a binding trade agreement with Cadence Minerals.
GlaxoSmithKline shares rally and buck the FTSE trend
GlaxoSmithKline (LON:GSK) continues to rally and avoid the more bleak fate being faced by some of its FTSE 100 counterparts.
GSK’s share price has progressed in its usual manner, with an incremental rise of 0.16 percent since trading opened this morning; the price going from 1505.2-1513.6 GBX in the first five minutes of trading.
This is impressive, not only because of the current climate of the global market, but because the company is suffering from a series of patent expirations, which have prompted analysts to label the stock as overvalued in fundamental terms.
However, what makes this stock so appealing are its standardised dividends and projected profits. Over the last five years, the only fluctuation in GSK’s dividends was 2 GBX in 2013, with a trend of 80 GSX per share – a yield of 5 percent per annum – over the last four years.
Further, estimates from analysts are bullish. GSK are predicted to see an earnings growth of 15.9 percent per year, with an earnings increase of 0.212-0.959 GBP over the next three years. In the short-term, at least, such projections don’t seem outlandish. With recent success in the phase three trial of its two-drug HIV treatment and spiked demand in the US market for Shingrix, GSK’s shingles vaccine, profits in the near future look promising. It is quite possible that such profits will be bolstered, should GSK choose to sell off GSK Consumer Healthcare, with an estimated valuation of over 4 billion USD and Coke, Nestle and Danone all in the running.
It would be foolhardy to label GSK a safe stock, but it is currently one of the FTSE 100’s success stories. Only time will tell whether selling off GSKCH will inhibit their ability to reach their targets, or whether their dividends are sustainable.
Trump deserves a cheer for handling of China, says deVere Group strategist
As China’s central bank frees up funds for a looming trade war, Trump deserves at least ‘one out of three cheers’, affirms a senior analyst at one of the world’s largest independent financial advisory organisations.
The comments from Tom Elliot, deVere Group’s International Investment Strategist, come as U.S. President Donald Trump appears to be on the cusp of escalating his trade war with China.
Mr Elliott observes: “This week, the Trump administration is likely to reveal plans to limit Chinese investment in American firms and block the ability of U.S. companies to some high-tech products to China.
“Meanwhile, China’s central bank reducing its reserve requirements for its banks is significant. Is it just to add pressure on the U.S., by looking like they won’t back down and are preparing the economy for the worst? Or do they actually think no agreement to avert trade wars will be reached and that this is necessary?”
Relaxing bank reserve requirements allows banks to lend out more money than before, a move generally taken in the face of a weakening economy.
Mr Elliott goes on to say: “The escalating dispute with China is as much about legitimate U.S. security considerations as it is about Trump’s apparent lack of understanding of the benefits of free trade.”
The Trump administration objects to what they see as the stealing and forced licensing of U.S. technology, by China, from American companies that do business in China.
“On this the EU, Australia and Japan are in agreement, but show far less willingness to stand up to China. So, Trump deserves at least one out of three cheers for what he’s doing.”
House price growth falls to lowest level in five years
House price growth in the UK has fallen to its lowest level since 2013, with London prices leading the drop.
Nationwide reported their house price figures on Wednesday, with the annual rate of growth falling by 2 percent this month. London was again the region reporting the weakest growth, with prices across the rest of the UK generally witnessing a rise.
The East Midlands was the fastest growing region, up 4.4 per cent on an annual basis to an average of £181,549 in the second quarter. This was followed by the West Midlands, which rose 4.3 per cent to an average £188,516.
Robert Gardner, Nationwide’s chief economist, said:
“Surveyors continue to report subdued levels of new buyer enquiries, while the supply of properties on the market remains more of a trickle than a torrent.
“Looking further ahead, much will depend on how broader economic conditions evolve, especially in the labour market, but also with respect to interest rates.
“Subdued economic activity and ongoing pressure on household budgets is likely to continue to exert a modest drag on housing market activity and house price growth this year, though borrowing costs are likely to remain low.”
Fastjet in danger of collapse without new funding
Shares in African budget airline Fastjet (LON:FJET) are down over 60 percent, after warning that it may fall into administration without an injection of cash.
The African airline is in talks with major shareholders about receiving extra funding, adding that without it, “it may not be able to continue trading”.
The airline has received backing from easyJet founder Sir Stelios Haji-Ioannou, and flies in African countries including South Africa, Tanzania and Zimbabwe. “Whilst initial discussions with certain shareholders have been positive, discussions are ongoing and there can be no guarantee of a successful outcome,” the company said. “It is expected that any equity fundraise will be concluded in conjunction with the announcement of the company’s annual results for the year ended 31 December 2017.” The company’s share price collapsed by a third on Wednesday, falling 67.74 percent at 5.00 (1039GMT).Fresnillo dips and becomes the FTSE’s biggest casualty in June
Fresnillo plc (LON:FRES) moves toward volatility as share price dips, following a euphoric start to the month.
After silver prices reached a five-month high at over 17.20 USD an ounce in mid June, they have since dipped by over a dollar in the wake of trade tensions and the subsequent sell-off of silver. As such, all of Fresnillo’s gains since the start of the month have been cancelled out, their share price is down 0.7 percent within the first two hours of trading and 3.03 percent since Monday morning. In other words, a dip of 8 USD in the first two hours of trading and 34 USD since Monday morning.
On the whole, the firm’s value has dipped 13 percent since the start of the month, and analysts are predicting a 4 percent fall in profits in 2018.
Despite a drop of 1,146-1,138 GBX in the first 20 minutes of trading, brokers are bullish in their forecasts of long-term success for the mining firm. Their faith is built upon the fairly reliable demand for silver which is illustrated by the incremental rally of precious metal prices in recent years. Further, the company has seen its productivity boom with a yield of 15.4 million ounces of silver in the first quarter, which is a 14 percent increase on the same period the year before.
It is fair to say that Fresnillo’s stock has wobbled and borders on volatility, but the firm has suffered in the same way as most, in the midst of the Sino-US tensions that have had implications for most of the global market. Their drastic fall can perhaps be credited to their esteemed position amongst the elite of the FTSE 100 at the start of the month, which only gave them a greater pedestal to fall from. Going forwards, their share price remains relatively high, but at a level where one could expect to see a return on their investment in future months.
Bunzl post 11pc revenue rise after significant acquisitions
Distribution and outsourcing group Bunzl (LON:BNZL) reported an 11pc rise in first half revenue on Wednesday, after a period of expansion and acquisitions.
The group benefitted from a boost to revenue over the period, but added that underlying revenue growth had returned to more normal levels during the second quarter of 2018 as the group absorbed its new North American grocery business.
Going forward, Bunzl said it expected exchange rate movements to decrease constant exchange revenue growth for the first half by 6 percent, but said that so far trading was in line with expectations.
The group confirmed that its spend on acquisitions so far this year totalled £105 million, with acquisitions remaining a key part of business strategy.
“The pipeline for acquisitions remains active and, with ongoing discussions taking place, the company expects to complete further transactions during the remainder of the year,” the company said.
Bunzl also sold its marketing services business in the UK during the period, which had generated annual revenue of £46 million for the firm.
“The business was considered to be non-core as the opportunities to expand overseas in the short to medium term were limited and the company therefore decided that it was an appropriate time to sell the business,” Bunzl said.
Shares in Bunzl (LON:BNZL) are currently trading down 2.53 percent at 2,234.00 (1012GMT).
John Lewis warns on profit as high street continues to bite
High street giant John Lewis became the latest victim of the high street crisis on Wednesday, warning that first half profits will likely to be substantially lower than a year ago.
The department store chain, which also owns upmarket supermarket Waitrose, admitted in a statement that profits could be close to zero.
Sales at the group fell 0.8 per cent year-on-year to £226.77 million for the week ending June 23. Waitrose recorded a 0.2 per cent year-on-year sales growth, however, but John Lewis reported a drop of 2.2 per cent year-on-year.
Waitrose had a far better performance than John Lewis for the period, proving the relative strength of the grocery market in comparison to high street stores.
“Despite the mixed bag of weather, horticulture performed strongly, seeing sales rise by eight per cent. Houseplants were popular up 28 per cent and outdoor plant sales boosted 15 per cent,” Waitrose commercial director Rupert Thomas said.
“Beers, wines, spirits and tobacco had a good week with sales up 2.4 per cent. Wine performed particularly well up seven per cent with sparkling wine saw an uplift of 28 per cent.
However, home sales were down 3.7 per cent, fashion sales were down 0.1 per cent and electrical and home technology sales fell by 3.4 per cent.
The group said it was also planning to close several small Waitrose stores, including one in Camden, two Little Waitrose outlets in Manchester and one in Birmingham.
FCA to halt investigation into Mitie Group
Mitie Group (LON:MTO) shares had a volatile start to the day on Wednesday, after the UK authorities said they were ceasing their investigation into the group.
Shares rose at market open, before sinking right down below their opening level in the news that the Financial Conduct Authority would no longer be investigating the company’s disclosure practices.
The investigation began last August, when it announced it would be looking into the company’s manner of preparation and content of their financial results. This was alongside the ‘timeliness’ of a profit warning announced in September, 2016.
However, in a statement on Wednesday Mitie said:
“On 26 June 2018, the FCA advised the company that it was discontinuing its investigation into the company”.,
Shares are currently trading down 0.28 percent at 158.56 (0936GMT).
AssetCo shares down 4pc as profit tumbles
Shares in Middle East fire and emergency services provider AssetCo (LON:ASTO) dropped nearly 4 percent in early morning trading on Wednesday, after operating profit tumbled in the six months to March.
Operating profit fell 70.5 percent to £0.5 million, from £1.7 million in the correlating period last year, with adverse currency movements having a £0.7 million adverse effect on figures. The group also took a £0.5 million hit from a fall in training and logistics revenues.
The company also commented on the progress of its lawsuit against Grant Thornton, which with interest amounts to approximately £40 million. It said it was in the process of being heard in the High Court with a decision expected later in this year.
The claim was filed in December 2015 after AssetCo claimed the group had missed a series of “risk factors” and “trigger factors”, including potentially fraudulent payments and statements made by former directors John Shannon and Raymond Flynn.
Shares in AssetCo are currently trading down 3.80 percent at 380.00 (0916GMT).