SSE ploughs ahead with commitment to renewable energy

Liam Roche
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SSE ploughs ahead with commitment to renewable energy

SSE to spend £7.5bn on decarbonising from now until 2025

SSE (LON:SSE), the energy company based in Scotland, announced on Wednesday that its profits rose during the year, as the company moved forward with its plan to reach net zero carbon emissions.

The FTSE 100 company made an adjusted pre-tax profit of £1.06bn for the year to March, an increase of 4% compared to the year before.

SSE believes the total cost of the pandemic will be £170m, below its initial expectations.

SSE also pledged to move forward with its transition to using renewable sources of energy. The group said it plans to spend £7.5bn on decarbonising from now until 2025.

The transmission arm is set for expenditure of £2.8bn for its next regulatory period, while the distribution arm’s plans are set for submission in July.

James Magness, director of Energy and Resources at Edison Group, commented on SSE’s government partnership for this year’s COP26 climate summit, among other things.

“SSE PLC today reported a sturdy set of results for the past year as it managed to deliver an increase in operating profit of 1% up to £1,506.5m. The fallout of the pandemic was felt by the company, with the impact on its operating profit estimated at £170m, which was towards the lower end of its guided range. The adjusted earnings-per-share came in within its guidance of 85-90p, as it reported an increase of 5% to 87.5p, with reported earnings per share at 215.7p per share. The company continued to fundraise during the period, as it reaffirmed its status as the largest issuer of green bonds in the FTSE 100, with the issuance of £500m in March 2021, SSE’s fourth green bond in five years,” Magness said.

“The past year saw continued development for SSE across its £7.5bn Capex plan of investing in low-carbon projects, highlighted with construction well-underway on its new wind farms, including the world’s largest offshore farm at Dogger Bank. The development of these projects chimes with the government’s ambitious net-zero push, with SSE being established as a Principal Partner to the UK Government for the COP26 UN climate summit in November 2021.”

The Gym Group lifted by strong demand as gyms reopened

Liam Roche
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The Gym Group lifted by strong demand as gyms reopened

The Gym Group adds four new sites and is looking to go further

The Gym Group (LON:GYM) confirmed on Monday that its business has surpassed its expectations as people rushed back to its gyms as lockdown restrictions eased.

The company revealed that all of its 187 locations have now reopened, although social distancing measures remain, as well as a limit on guests.

Since the reopening The Gym Group’s total membership numbers rose from 547,000 at the end of February to 729,000 on May 24.

It remains some way of the 794,000 members recorded in December 2019, prior to the outbreak of Covid-19.

The fitness company has even opened four new sites across the UK, including Sydenham, Chichester, York and Cambridge.

The Gym Group expects its rate of new memberships to slow during the summer as that is generally a less busy period for the industry.

Net debt stood at £63.1m at the end of April, while the firm has a total bank facility of £100m. The company has said that it has entered talks of increasing its financial flexibility as it looks to expand by getting new sites.

The Gym Group share price is up by 2.51% to 265.50p in the morning session on Wednesday.

Richard Darwin, chief executive of The Gym Group, commented:

“Our members are delighted to be working out in the gym once more with visits per member and new joiner sign-up rates at record levels. With membership levels growing strongly, we are building our pipeline of new gyms to take advantage of what we see as a unique opportunity to extend affordable fitness to even more locations across the UK.”

British Land sees value of holdings fall by £1bn during pandemic

Liam Roche
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British Land sees value of holdings fall by £1bn during pandemic

British Land confirmed its third annual loss in a row

British Land, one of the UK’s largest property development and investment companies, has seen the value of its properties fall by £1bn due to the outbreak of coronavirus.

As the outlook for high streets and shopping centres worsened, many businesses were forced to close, and the FTSE 100 company saw its portfolio fall by more than 10% to £9.1bn.

British Land confirmed its third annual loss in a row, as its loss after tax came in at £1.08bn. A year earlier the company made a £1.11bn loss.

The property development company said that offices lost 3.8% of their value during the year to March 31, while shopping centres saw their value fall by 36%.

British Land’s underlying profit dropped by 34% to £201m as many tenants became unable to pay their rent.

At early morning trading, British Land shares are down by 1.69% to 510.80p.

British Land’s chief executive commented on the company’s results and looked ahead:

“While Covid-19 has clearly impacted our performance, with the portfolio value down 10.8%, we have a strong balance sheet and have already delivered excellent progress against our four priorities. We’ve sold £1.2bn of assets, overall 6.2% ahead of book value, completed our first net zero development at 100 Liverpool Street and committed to develop Norton Folgate and 1 Broadgate, where we have pre let nearly 30% of the office space to JLL. We have made our first logistics acquisition in north London and acquired £197m of high quality retail parks. Operationally, we have driven rent collection and leasing activity, which at 1.7m sq ft in Retail was our highest ever. I would like to thank the whole team for their incredible efforts this year.”

“Looking forward, we will further align our business to growth and value, benefitting from the pick up in economic activity that is now emerging. On our Campuses, we have an opportunity to introduce innovative growth sectors including life sciences at Regent’s Place. At Canada Water our planning permission is deliberately flexible, enabling us to deliver a range of uses aligned to growth and long term trends. In Retail & Fulfilment we will continue to target value opportunities in retail parks and development-led, logistics in London. We will maintain our focus on the everyday management of our spaces: driving rent collection, supporting our customers and making our space more sustainable.”

Amigo Loans share price plummets after court ruling

Liam Roche
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Amigo Loans share price plummets after court ruling

Amigo described the compensation package as essential to its survival

Amigo Loans, one of the UK’s major subprime lenders, could struggle to survive much longer after a high court judge refused to approve a compensation scheme on Tuesday.

The company described the compensation package as essential to its survival.

Amigo was attempting to minimise its liabilities for backdated customer complaints through the arrangement.

Amigo shares dived by 53%, down to 8.76p at the time of writing, following the judge, Mr Justice Miles’s ruling that the court would not sanction the scheme.

While the company had previously secured a majority of 95% of votes supporting the scheme from customers at a meeting earlier in May, Miles pointed out that the turnout was a mere 8.7%.

“I understand why the directors have sought to find a way of addressing the potentially unsustainable level of redress claims,” Miles said.

Miles added: “Some form of restructuring of the group is clearly desirable and indeed needed. But the question is whether, in all the circumstances, this scheme should be approved. I have accepted the submissions of the Financial Conduct Authority that the redress creditors lacked the necessary information or experience to enable them properly to appreciate the alternative options reasonably available to them; or to understand the basis on which they were being asked by Amigo to sacrifice the great bulk of their redress claims, while the Amigo shareholders were to be allowed to retain their stake.”

Having previously said that the company’s shares would become worthless without the scheme, chief executive of Amigo Gary Jennison said: “We are currently reviewing all our options and will provide an update at the earliest opportunity.”

Amigo grew in the aftermath of the 2008 financial crisis, reaching a valuation of £1.4bn as it was listed 10 years later.

How could China’s bitcoin mining ban impact the Argo Blockchain share price?

Liam Roche
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How could China’s bitcoin mining ban impact the Argo Blockchain share price?

Argo Blockchain Share Price

The Argo Blockchain share price (LON:ARB) is up by 11.53% on Tuesday, as it recovers somewhat from a turbulent period for bitcoin. The move comes as talk over China’s plan to ban bitcoin intensifies, as well was Argo making steps to prove its environmental credentials. Despite falling through April and May, the Argo Blockchain share price remains up by 294% since the beginning of the year. In light of recent news, investors will be curious to see if the mining company can gain a competitive advantage beyond its exposure to bitcoin.

Bitcoin Mining Council and China

Argo confirmed it has joined the Bitcoin Mining Council (BMC). The organisation is made up of North American cryptocurrency miners with the aim of promoting energy transparency and more sustainable mining methods. The move comes in addition to Argo recently signing the Crypto Climate Accord.

“Today is a good day for the planet. Sustainability has always been at the heart of Argo’s mining operations and the newly-formed Bitcoin Mining Council is the next logical step in fostering a sectoral shift towards renewable energy”, said Argo chief executive Peter Wall.

The Chinese government also appears set to ban all bitcoin mining. The government will “crack down on bitcoin mining and trading behavior and resolutely prevent the transfer of individual risks to the society,” according to a statement issued by the Financial Stability and Development Committee of the State Council, the country’s cabinet equivalent.

The Chinese government voiced concerns over perceived risks including financial stability, money laundering, drug trafficking, smuggling and profligate energy use.

Therefore, as Argo moves closer to being a net-zero miner, it could stand to gain a substantial market share from Chinese miners, which will no longer operate. In that case the Argo Blockchain share price could do very well in the future. However, those investing in Argo will remain exposed to the volatile price of bitcoin.

Ironridge Resources: Drilling into the figures

Jon Levinson
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Ironridge Resources: Drilling into the figures

DRILLING  INTO THE FIGURES 
Ironridge Resources (LSE:IRR) - 18.2p - Increased value seems unnoticed. 
There is a blindness when exploration companies announce drilling grades as IRR have today. Cynical  investors have also learned that a fund rise will often follow. Ironridge recently raised £12m at 20p as they are developing two metals reserves; they're near to a FS (Feasibility Study) for the Lithium Ewoyaa project and is highly prospective.
So drilling into today's announcement, further high grade results are reported from Ironridges Ewoyaa lithium Project...

Hurricane Energy slumped to a $625.3m loss amid ‘upheaval and frustration’

Liam Roche
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Hurricane Energy slumped to a $625.3m loss amid ‘upheaval and frustration’

Hurricane Energy share jumps by over 3%

Hurricane Energy (LON:HUR) slumped to a $625.3m loss as the company implements its financial restructuring on the back of a testing year.

A major factor behind the losses for the year ending in December were the $567.1m impairment charges to do with its flagship Lancaster field.

The AIM-listed company said the past year had been “profoundly challenging” on a number of levels.

Hurricane Energy confirmed that Lancaster field had produced an average of 14,900 bopd in 2020, although it was lower than expected as the field underperformed against its expectations.

Having once been considered the keystone to a 2.6bn-barrel portfolio, the field was downgraded to 7.1m barrels of proven plus probable reserves via a report in April.

A restructuring plan was outlined last month, but the board said it was most likely that the field would be discontinued when Lancaster stops producing in 2024.

Approaching lunchtime on Tuesday, the Hurricane Energy share price is up by 3.77% to 1.35p.

Antony Maris, chief executive of Hurricane, commented:

“This has been a profoundly difficult period for Hurricane and its stakeholders. The understanding of the West of Shetland fractured basement play has changed significantly. As a result, the potential of the Lancaster field is much smaller than originally thought and cannot support the level of debt in the Company which was sized for a much larger Reserves and Contingent Resources base.”

“Against this extremely challenging backdrop, the Company has explored all potential options to resolve the Company’s financial situation, with the proposed financial restructuring ultimately being deemed the best possible outcome. We understand the impact this will have on our shareholders and the strong feelings that have been expressed as a result, but this was a necessary move in order to secure the Company’s future.”

“If the proposed restructuring is approved and implemented, we will focus our efforts on maximising Lancaster cash flows to pay down debt, as well as making the case for further development of our West of Shetland asset base”

FTSE 100 off to a slow start as cable nears three year high

Liam Roche
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FTSE 100 off to a slow start as cable nears three year high

The FTSE 100 rose by a nominal amount early on Tuesday, up to 7,052.27. UK borrowing figures surpassed expectations, but remained the second highest ever, failing to significantly impact the UK index.

“It didn’t help that the pound continued to make inroads against the dollar, adding another 0.2% to cross $1.419. If cable can maintain that slender growth all the way until the end of the day, it will achieve its best close in over 3-years,” said Connor Campbell, financial analyst at Spreadex.

Returning from their Bank Holiday rest, the DAX and CAC saw contrasting fortunes on Tuesday. The German bourse was up close to 0.7%, and trading at 15,550. Its French counterpart, meanwhile, struggled to move beyond 6,400 as it opened the session as unchanged as the FTSE.

“Looking to this afternoon and the Dow Jones is set to continue its creep back towards 35,000. A 0.2% addition when the bell rings on Wall Street would equate to a 60-point increase, lifting it to 2-week peak of 34,460,” Campbell added.

FTSE 100 Top Movers

Aveva (4.43%), Just Eat (2.47%) and Ocado (1.89%) are the biggest risers on the FTSE 100 during the morning session on Tuesday.

Losing the most ground this morning was Vodafone (-0.99%), Fresnillo (-0.96%) and Admiral Group (-0.84%).

Aveva

Shares in software group Aveva rose this morning as the FTSE 1OO company reported strong H2 growth following an initial downturn thanks to the pandemic.

Aveva confirmed revenue of £820m for the year to the end of March, down by 1.6% albeit matching expectations, while adjusted earnings rose 4.4% to £226.4m.

The City would be in top ten carbon emitting nations in the world

Liam Roche
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The City would be in top ten carbon emitting nations in the world

London banks emitted 805m tonnes of carbon emissions in 2019 study finds

British banks and asset managers finance nearly double the annual carbon emissions of the UK, a report has revealed.

Greenpeace and WWF co-published the study, which found that loans and investments provided by London finance companies for projects and businesses, emitted 805m tonnes of carbon emissions in 2019.

The figure amounts to 1.8 times the UK’s yearly net emissions for 2019, totalling 455m tonnes.

If the City was ranked as a country, it would surpass Germany as the ninth largest emitter of carbon emissions in the world.

Both Greenpeace and WWF are encouraging the UK government to implement new regulations that would align the finance sector with the Paris Climate Accord.

Executive director of Greenpeace UK John Sauven said the UK could not ignore its financial institutions’ contribution to climate change, especially ahead of the Cop26 conference in Glasgow.

“Finance is the UK’s dirty little secret,” Sauven said. “Banks and investors are responsible for more emissions than most nations, and the UK government is giving them a free pass. How can we say we’re ‘leading the world on climate action’ while allowing financial institutions to plough billions into fossil fuel production every year? The claim is almost laughable.”

Tanya Steele, the chief executive of WWF UK, called on the financial sector to move to zero carbon transition plans that cover their investments all over the world.

“Trying to set a path to net-zero emissions without tackling the UK financial sector is like sticking a plaster when the patient needs open heart surgery,” she said.

“Despite seeing ambitious commitments to tackle the climate emergency, our finance sector is still driving global investment towards the old, destructive ways of doing business that are destroying our one shared home.”

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