BBGI Global Infrastructure S.A. NAV rises 6.7% on inflation-linked equity cash flows

Natasha Doris
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BBGI Global Infrastructure S.A. NAV rises 6.7% on inflation-linked equity cash flows

BBGI Global Infrastructure S.A. shares climbed 0.5% to 162.4p in early morning trading on Wednesday, following an investment basis NAV rise of 6.7% year-on-year to £1 billion in HY1 2022.

The firm mentioned its equity cash flows were positively linked to inflation, resulting in its NAV increase.

The global infrastructure investment group confirmed a 6.5% NAV per share growth to 149.8pps compared to 140.7pps the year before.

BBGI Global Infrastructure S.A. reported a 7.48pps target dividend for FY 2022, 7.63pps for FY 2023 and a 7.78pps target dividend for FY 2024.

The company announced a 2.03 times cash dividend cover against 1.31 times in FY 2021.

BBGI Global Infrastructure Group S.A. noted a Total Shareholder Return since IPO of 150.3%, representing 9.1% on a compound annual basis.

“I am pleased to report that BBGI has delivered an exceptionally strong operational performance for the first half of 2022. This performance reflects the low-risk investment strategy that the Company has followed since IPO in 2011. Our cash dividend cover of 2.03x supports the Company’s target dividend of 7.48 pps for 2022, and reaffirmed target dividend of 7.63pps for 2023 and of 7.78pps for 2024,” said BBGI Global Infrastructure S.A. non-executive chair Sarah Whitney.

“Over the period to 30 June 2022, the Company’s high quality inflation-linked cash flows led to a total increase in NAV of £47 million, representing a 4.7 per cent uplift, and highlights the portfolio’s genuine high-quality inflation-linkage. This contributed to a NAV per share increase of 6.5 per cent or 9.1 pence in the reporting period.”

“Despite this challenging macroeconomic backdrop, given the AAA and AA-rated countries in which we invest and the fundamentals of our investment proposition, we have confidence in our resilient and defensive strategy. In an uncertain world, I am reassured by our ability to continue to deliver long-term value to our stakeholders.”

Braemar Shipping Services: Finals Full Steam Ahead

Jon Levinson
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Braemar Shipping Services: Finals Full Steam Ahead

raemar (LSE: BMS), after reporting strong trading with its delayed Finals to  End Feb, the price improved to 334p.  Its Revenue increased 21% to £101m with   a spectacular 209% recovery in profits to £13.9m and the EPS of 27.95p gives a P/E of  12x with a  2.7% yield. BMS is the smallest of the few listed Shipbrokers, and it operates from 19 countries   The new team is focusing on its core shipbroking and corporate finance business so have disposed of non-core activities, such as the Engineering Division and loss-making businesses have been clo...

CentralNic continues impressive growth

Andrew Hore
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CentralNic continues impressive growth

Strong trading momentum continues at domain name and online marketing services provider CentralNic (LON: CNIC) and existing forecasts could be upgraded again later in the year if growth continues at current levels. A further boost to earnings is expected from a refinancing of the company’s bonds.
The growth is coming from the online marketing division where revenues jumped from $96.4m to $257.8m, although gross margin declined so there was a lower percentage increase in gross profit – although it did still more than double. There are no signs of a slow down. The domain name distribution and se...

40,000 BT and Openreach workers join wave of UK strike action

Natasha Doris
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40,000 BT and Openreach workers join wave of UK strike action

BT and Openreach staff kicked off the latest strike in the recent wave of industrial action sweeping the UK as the cost of living crisis bites.

The Communication Workers Union (CWU) confirmed over 40,000 of its members would be taking strike action over Tuesday and Wednesday.

BT and Openreach workers will be striking for the first time in 35 years to protest insufficient salary increases.

The action coincides with the CWU’s Royal Mail strike, which is scheduled to start on 31 August with 115,000 members participating.

The industrial action joins a massive movement of sectors across the UK demanding higher pay to keep pace with inflation, which currently sits at 10.1% and is expected to rise to 13% in autumn this year.

BT Group said it offered a 5% pay rise, which rose as high as 8% for the lowest paid employees and represented the most significant pay increase in 20 years.

However, the CWU commented its members deserved a salary increase to match inflation and avoid a real term pay cut.

The organisation pointed out that BT CEO Philip Jansen received a 32% pay rise last year to £3.5 million, making 86 times the average BT worker salary.

“Our members worked tirelessly to keep the company going and keep the company connected throughout the pandemic,” said a CWU spokesperson.

“Without our BT and Openreach members, there would have been no home working revolution. They deserve a proper pay rise, and that’s what we’re fighting for.”

A BT spokesperson commented earlier in August: “We know that our colleagues are dealing with the impacts of high inflation and, although we’re disappointed, we respect their decision to strike.”

“We have made the best pay award we could and we are in constant discussions with the CWU to find a way forward from here. In the meantime, we will continue to work to minimise any disruption and keep our customers and the country connected.”

FTSE 100: stocks regain ground after Jackson Hole shock

Natasha Doris
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FTSE 100: stocks regain ground after Jackson Hole shock

The FTSE 100 recovered slightly from the shock of US Federal Reserve chair Jerome Powell’s comments last Friday, gaining 0.2% to 7,441.9 by lunchtime on Tuesday.

“The FTSE 100 started on the front foot after the Bank Holiday, having careered into the long weekend with some substantial losses after Federal Reserve chair Jerome Powell’s hawkish speech at the Jackson Hole summit,” said AJ Bell

“It helps that US stocks have stabilised to some extent in the interim. Unsurprising given that many expected Powell to pour a dose of cold water on the idea that a so-called ‘dovish pivot’ was on the way.”

Indeed, US futures recovered some ground in pre-open trading, with the Dow Jones gaining 0.7% to 32,305, the S&P 500 rising 0.9% to 4,068 and the NASDAQ climbing 1.2% to 12,644.7.

Pound weakens against Dollar

The FTSE 100 was aided by a weakening in the Pound against the Dollar, as Powell’s hawkish stance spurred an abandonment of stocks, knocking the currency down with the markets shakeup.

“Helping the FTSE 100 is strength in the dollar relative to sterling – will forex traders be eyeing the possibility of parity between the pound and its US counterpart? A similar fate to that which befell the euro recently,” said Mould.

“It would take a big move to get there but as the energy crisis continues to grip the UK it doesn’t feel like a scenario where you could rule anything out.”

“A weak pound is typically good news for a FTSE 100 index which is heavily dominated by overseas earners.”

Europe energy crisis

European markets regained some losses, despite Russian energy firm Gazprom’s approaching shutdown of the Nord Stream 1 pipeline between 31 August and 2 September for apparent maintenance works.

The unscheduled upheaval is set to exacerbate an already critical energy crisis plaguing Europe, as countries across the continent brace for a difficult winter amid Russia’s gas supply deficit.

“Putin’s use of Russian gas supplies as a proxy front in the current conflict with Ukraine continues to add to the supply pressures in the energy market and ramps up the pressure as winter starts to approach,” said Mould.

The German DAX rose 1.7% to 13,123.2, the French CAC gained 1.1% to 6,291.2 and the Italian FTSE MIB increased 1.5% to 22,184.7.

Dechra Pharmaceuticals

Dechra Pharmaceuticals shares soared to the top of the FTSE 100 with a 3.6% climb to 3,566p following its reported acquisition of US veterinary pharmaceutical group Med-Pharmex for £221.5 million.

“I am delighted that we have completed the acquisition of Med-Pharmex, a company that I have been in dialogue with for a number of years,” said Dechra Pharmaceuticals CEO Ian Page.

“The US market is highly consolidated, therefore this is a unique opportunity to add several new products to our portfolio, enter the US FAP market and improve the manufacturing footprint for our North American business.”

Bunzl

Bunzl shares fell 5.9% to 2,931, hitting the bottom of the index after its results disappointed investors.

The company announced a 16.1% revenue growth to £5.6 billion on product cost inflation and acquisitions across the HY1 2022 financial term.

However, despite a raised operating margin outlook, its FY 2022 result is expected to drop slightly against FY 2021.

Grocery purchasing power fallen 9-10% since 2019, according to study

Natasha Doris
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Grocery purchasing power fallen 9-10% since 2019, according to study

Consumer purchasing power in the grocery sector has fallen approximately 9-10% since 2019, according to a recent study by TradingPedia.

The study found the total price of groceries rose 22.6% between August 2019 and August 2022, against a climb of 13.5% from £538 to £611 in the average weekly earnings of all UK employees between June 2019 and June 2022.

According to researcher Brian McColl, a basket of 55 items purchased from Tesco would have cost £109.89 in August 2019. However, the same basket of items currently amounts to £134.76 at checkout.

Food items including Tesco Finest white loaf rose 36.3% in price from 99p to £1.35, while chicken breast portions increased 10.5% from £3.80 to £4.20 and Tesco British unsalted butter climbed 16.6% from £1.50 to £1.75.

The price tag on branded items soared, with Hellmann’s mayonnaise spiking 70% from £20 to £3.40, Clover lighter spread rising 140% from £1 to £2.40 and Doritos tortilla chips more than doubling in cost with a 102% surge from 99p to £2.

Analysts at Citigroup currently estimate food price inflation will peak at approximately 20% in Q1 2023, while producer price inflation will keep accelerating.

Recent reports by the Institute of Grocery Distribution estimate a 15% peak in food inflation in summer 2022, with grocery costs expected to remain high heading into 2023.

“Food price inflation is very likely to mount greater upward pressure on wage demands compared to other types of inflation. And that is quite a concern for Bank of England policy makers, because considerable wage increases may also drive overall inflation,” said TradingPedia analyst Michael Fisher.

“Still, on a more positive note, Bank of England expects inflation to begin moderating in H1 of 2023 and ultimately return to its inflation target at some point during the second half of 2024”

Uniphar gross profits climb to €146m on strong performance across all divisions

Natasha Doris
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Uniphar gross profits climb to €146m on strong performance across all divisions

Uniphar shares gained 1.7% to 302.5p in late morning trading on Tuesday, after the company reported a 2.8% revenue increase to €991 million in HY1 2022 against €964 million the year before.

The firm announced an 8.8% gross profit climb to €146 million compared to €134 million, alongside a gross profit margin rise to 14.7% from 13.9%.

Uniphar noted a gross profit increase across all divisions, including outperformance in Supply Chain & Retail with a 5.2% organic growth.

Meanwhile, pre-tax profits before tax excluding exceptional items soared 9.9% to €26 million against €123 million in HY1 2021, despite inflationary headwinds.

Uniphar highlighted a 9.2% EBITDA growth to €44 million against €41 million, and a 6.2% operating profit rise to €25 million from €23 million.

The group noted a net bank debt of €73 million compared to €30 million year-on-year.

The company confirmed a basic EPS of 5.9c from 5.7c in the previous year, and an adjusted EPS of 8.4c against 7.1c.

“The Group has performed strongly during the period delivering Adjusted Earnings per Share growth of 18%. Each division has delivered organic gross profit growth, underpinned by a strong team performance across the board, with an outperformance in Supply Chain & Retail. The Group has leveraged its scale and diverse service offering to help mitigate inflationary pressures which continue to be a challenge across the globe,” said Uniphar CEO Ger Rabbette.

“Additionally, we have completed the acquisition of Orspec Pharma, marking our entry into the strategically important Asia-Pacific region. Orspec, headquartered in Australia, will support our goal of becoming a global leader in Product Access services through the provision of Expanded Access Programs and the delivery of unlicensed medicines.”

“We remain confident and are on track to achieve our strategic objective of doubling 2018 pro-forma EBITDA within five years of IPO”

Uniphar recommended an interim dividend of €0.0061 per ordinary share.

Bigblu Broadband revenue climbs 13.8%, strong HY2 anticipated

Natasha Doris
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Bigblu Broadband revenue climbs 13.8%, strong HY2 anticipated

Bigblu Broadband shares dipped 1.5% to 52.7p in late morning trading on Tuesday following a 13.8% revenue climb to £14.9 million in HY1 2022 compared to £13.1 million the last year.

The telecommunications group announced a like-for-like revenue growth of 11.5% on a constant currency basis.

Bigblu Broadband reported an adjusted EBITDA of £2 million in the interim period, remaining flat year-on-year.

The company noted an adjusted operating cash flow of £1.3 million from £1.3 million the year before, and an adjusted free cash inflow of £400,000 compared to £300,000 in HY1 2021.

The firm mentioned net cash of £4.5 million at 31 May 2022 against £4.1 million in the previous year, following repayment of its debt in full and the return of capital in the last financial year.

“We are pleased with the continued progress shown by the Group in the Period. Extensive effort has been made across the business units to switch customers into more attractive packages at the expense of net adds, with c4k migrations in the period and net adds of 3.2k, of which 2.2k were associated with Clear acquisition,” said Bigblu Broadband CEO Andrew Walwyn.

“The investment we have made to improve our offering in the Nordic region provides us with optimism that this region can return to growth. In addition, our Australian business continues to perform strongly. We are seeing churn levels reduce, and ARPU’s improve, resulting in strong revenue growth.”

“In the second half of the year, we will continue supporting customers unserved and underserved in the digital divide, whilst at the same time improving our product range thereby reducing churn. We are already seeing increasing gross adds and reduced churn from the start of the second half year. We will continue to consider all options in respect of maximising shareholder value. Following typical seasonal trends, we expect a strong second half and are comfortable with market expectations for the current financial year.” 

AIM movers: Recommended Diurnal bid and PetroNeft Resources shuts down wells

Andrew Hore
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AIM movers: Recommended Diurnal bid and PetroNeft Resources shuts down wells

Neurocrine Biosciences Inc is bidding 27.5p a share in cash for Diurnal (LON: DNL) and the recommended offer values the drug developer at £48.3m. The share price rose 133.3% to 26.25p. The April 2021 placing and open offer was at 70p a share. Revenues have been slow to develop for Diurnal’s approved treatments, and cash is running out. Neurocrine can use its stronger balance sheet to build up sales for the Alkindi and Efmody adrenal insufficiency treatments with niche markets, as well as completing further clinical trials.

Renewable energy generator Simec Atlantis Energy Ltd (LON: SAE) has secured grid variations for the 230MW / 460MWh battery energy storage system at the Uskmouth site. The project should be operational by 2024. Simec Atlantis Energy has received a £6m payment from Uskmouth Energy Storage in the form of an interest-free loan. The payment is due on planning permission. A further £4m development premium is payable on financial close. A £2m convertible loan from SIMEC Group has been repaid. The share price jumped 32.3% to 2.05p.

Nanosynth Group (LON: NNN) has signed a joint development agreement with a global wellness company. The development programme for the cosmetics market will last 12 months. The two companies will own their own IP and then enter an exclusive agreement for the supply of nanoparticles.  The share price is 12.6% ahead at 0.535p.

Invinity Energy Systems (LON: IES) says contract manufacturer Baojia has shipped 1.1MWh of Invinity batteries from its factory in China for the project with Elemental Energy in Canada. Final assembly and testing will be done by Invinity before delivery. The share price rose 6% to 49.8p.

Oil and gas producer PetroNeft Resources (LON: PTR) has an oil storage and transportation contract with Nord Imperial for production from licence 61 in Tomsk Oblast, Russia at far above standard market rates. PetroNeft has tried to change the contract and started paying reduced amounts, but Nord Imperial has suspended acceptance of oil. PetroNeft is shutting down its wells. Licence 67 is not affected and is producing 270 barrels of oil per day. The shares slumped 16.7% to 0.75p.

Fashion brand Joules (LON: JOUL) says talks with NEXT (LON: NEXT) are continuing. This is despite media reports that NEXT is going off the idea of investing in Joules following recent poor trading. It was suggested that an investment would be made at 33p a share or more, but this is currently a large premium to the market price, which fell a further 7.75% to 23.525p.

Pound weakens against Dollar and Euro on hawkish US Fed interest rates fears

Natasha Doris
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0
Pound weakens against Dollar and Euro on hawkish US Fed interest rates fears

The Pound Sterling weakened against the Dollar and the Euro after US Federal Reserve chair Jerome Powell’s comments at the Jackson Hole convention sent markets on both sides of the Atlantic into a spiral last Friday.

Investors fled stocks following Powell’s confirmation of probable further interest rate hikes to tackle sky high inflation. A single month of inflation reduction to 8.5% from 9.1% in July proved insufficient to sway the US Fed from its hawkish stance on rate hikes.

Despite analysts long-expecting Powell to dismay hopes of a dovish sentiment, the markets still appeared significantly upheaved, knocking the Pound down against the Dollar and stirring remarks the currency might be on its way to parity, similar to the Euro earlier this month.

“[Will] forex traders be eyeing the possibility of parity between the pound and its US counterpart? A similar fate to that which befell the euro recently,” said AJ Bell investment director Russ Mould.

“It would take a big move to get there but as the energy crisis continues to grip the UK it doesn’t feel like a scenario where you could rule anything out.”

One pound was equal to 1.1743 US Dollars and 1.1715 Euros in early morning trading.

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