Nostra Terra Oil and Gas Company plc (LON:NTOG) shares rose 7.46% to 1.80p after saying it will be issuing a full response to what it believes are “factual inaccuracies” made by Magnolia Petroleum PLC.
Magnolia on Tuesday issued a circular convening a general meeting for 18 July, claiming that it had been contacted by Snead group and Nostra Terra’s chief executive, Matthew Lofgran, about removing Magnolia’s boss.
The Snead group has proposed removing Magnolia’s chief executive Rita Whittington, and appointing Nostra Terra chairman Kristian Ainsworth as a director.
Magnolia said Lofgran had stated that he was contacted by former directors and brokers who wanted changes to be made to the board. But the company noted that Lofgran was not a shareholder at the time, nor was Nostra Terra. In May Nostra Terra agreed to buy Magnolia shares held by the Snead group via a delayed settlement that has yet to occur.
“In the coming days Nostra Terra will release a full response to Magnolia's announcement, correcting what Nostra Terra believes to be factual inaccuracies in the MAGP announcement and Circular and addressing what Nostra Terra believes to be the fundamental challenges facing MAGP,” Nostra said in a statement today.
“Given its operational and commercial experience in the onshore oil and gas market in the United States, Nostra Terra believes that Magnolia is pursuing the wrong strategy and that it is well placed to assist Magnolia in restructuring its business model and delivering shareholder value.”
Empyrean Energy up stake in California
Empyrean Energy plc (LON:EME) gained 3.45% to 7.50p as it reached a deal to increase its stake in the Sacramento Basin of gas projects in California.
Within the Basin, group’s holding in the Dempsey prospect was raised to 30% from 25% and its interest in the Alvares Appraisal prospect was lifted to 25% from 10%. Empyrean’s stake in the Dempsey Trend in the Basin also increased to 30% from 25%.
Empyrean will pay US$90,000 on top of the US$10,000 it has already paid on signing a farm-out agreement and joint operating deal.
Highlands to focus on Niobrara
Highlands Natural Resources fell 5.77% to 24.50p after saying it will need to raise funds to develop the Niobrara oil and gas project in East Denver, pursue the commercialisation of DT Ultravert and support the Helios Two prospect.
The company said it is exploring a number of different avenues to accessing such funds.
“In essence, these centre around access to third party funding based on third party participation in the East Denver prospect and additional shareholder funding through the issue of more shares,” the company said.
“The final choice on timing and mix of these funds will depend not just upon the availability of such funds but also the relative dilution suffered by existing shareholders, either through the increase in share capital or the decrease in stake in the East Denver prospect.”
1.29pm: HaloSource shares plunge
HaloSource Inc. (LON:HALO) shares plunged 73.81% to 0.275p as the clean water technology company announced a Chinese e-commerce partnership.
The group has reached a deal with Shanghai JiuBan Industrial Co. Ltd. to distribute a new line-up of filtering water pitchers and bottles, marketed under HaloSource's new astrea brand via e-commerce in China.
Under the five-year exclusive deal, JiuBan will purchase 360,000 pitchers and more than one million replacement cartridges, representing more than US$10mln of revenue to HaloSource in the first three years.
Earlier this month the company had warned investors it faced possible insolvency but yesterday it announced it had raised £1.8mln to provide working capital to fund the company beyond the second quarter.
The fundraise will also allow HaloSource to continue on the development and scale-up of its new lead removal technology.
Hornby steams ahead
On the upside, Hornby (LON: HRN) rallied after the model train maker on reports of a takeover offer from Phoenix Asset Management.
Phoenix – already the lossmaking toymaker’s largest shareholder – is buying a 20% stake from New Pistoia Income Limited.
Following the acquisition, Phoenix will own 55% of Hornby. The deal is expected to be completed on 23 June.
Phoenix has said it wants to keep Hornby’s listing on AIM rather than take it private in order to maintain transparency.
Shares rose 3,2% to 32.25p in afternoon trading.
Braveheart in profit
Braveheart Investment Group plc (LON:BRH) shares shot 6.0% higher to 15.90p as it swung to a full year profit.
Pre-tax profit came to £780,000 for the year to 31 March, compared to a loss of £1.7mln the previous year.
The turnaround was helped by the sale of a stake in one of its investee companies, mLED, a developer of ultra-high brightness technology. It brought in £399,000 versus a book value of less than £100,000 and contributed towards a change in the fair value of the company’s assets of £450,000 for the year.
11.22am: Whitbread topping the FTSE
Whitbread plc (LON:WTB) is leading the charge on the FTSE 100 after the owner of Costa Coffee and Premier Inn hotels reported a strong start to the year.
Shares rose 4.59% to 4,030p in morning trading.
In a trading update for the 13 weeks to June 1, the firm reported total like-for-like sales growth of 2.9%, with Costa Coffee seeing a 1.1% rise, broadly matching a UBS forecast for around a 1.0% increase.
Premier Inn posted a 4.7% like-for-like sales increase, beating UBS's forecasts, although including the restaurants business – which was only up 0.7% - that growth was pegged back to 3.5%.
Another big riser on the FTSE 100, Centrica’s shares rose 1.63% to 205.40p as it said it was selling two gas power stations in England to EP UK Investments for £318mln.
The company said the sale of the power stations to EP, which is part of Czech energy group Energeticky, was "consistent with Centrica's strategy to shift investment towards its customer facing businesses”. The power stations are in Langage and South Humber Bank.
09.31am: Provident Financial shares drop on profit warning
Provident Financial plc (LON:PFG) shares slumped after warning that a restructuring at its consumer credit division would hit profits more than expected.
Shares fell 16.06% to 2,406.0p in morning trading.
The company said its reorganisation of the home credit business, which was announced in February alongside its full year results, was “virtually complete” but profits would nearly halve due to operational disruption.
Vacancy levels in recent months were more than twice as high as it had anticipated as the operational disruption affected debt collection and new sales.
Full-year pre-exceptional profits in 2017 are expected to fall to £60mln from £115mln in 2016.
First half results were also hit by a one-off exceptional charge of about £20m in respect of redundancy, retention and training costs.
"I am disappointed to report higher than expected operational disruption from the migration of the home credit business to a new operating model,” said chief executive Peter Crook.
Nonetheless, the strategic rationale for the change remains strong and I am confident that it will deliver the sUBStantial benefits previously communicated."
Lekoil over teething problems in Nigeria
Lekoil Ltd (LON:LEK) was under the cosh after saying its 2016 results were hit by delays to the start of commercial production at its Otakikpo project in Nigeria.
The company encountered cementing issues on the Otakikpo-002 well, which resulted in the temporary suspension of the E1 zone.
Commercial production began on 20 February, 2017, at 5,000 barrels of oil per day (bopd) but Lekoil had to contend with a number of teething problems including damage to the line connecting the offloading barge with the pipeline manifold offshore.
“As a result of this combined with limited storage capacity at the time, we throttled production back for a period to 3,000 bopd,” Lekoil said.
“These teething problems have now been successfully addressed and we are ramping up production once more. We are currently producing 5,500 bopd, are permitted to produce up to 8,000 bopd, and are applying to the regulator, via the Operator, to increase production to the 10,000 bopd steady state that we are targeting to deliver by the end of 2017.”
The company reported a total loss of US$15.76mln for the year to 31 December 2016, compared to US$18.72mln, and no dividend was declared. Shares fell 3.23% to 15.0p.
Quadrise boosted by no objection letter
Heading in the opposite direction, Quadrise Fuels International plc (LON:QFI) shares gained after saying its MSAR oil technology was proven to be safe to use in diesel engines.
MSAR, which uses technology to create enhanced emulsified synthetic heavy fuel oil (HFO) for marine bunker, power and industrial applications, completed 1370 hours of a 4,000 hours validation test on-board the vessel Seago Istanbul, equipped with a Wärtsilä 12RT-flex96C-B engine.
A letter of no objection (LONO) from Wärtsilä Services Switzerland Ltd confirmed that there was no detrimental effect on the RT-flex96C-B engines with the use of MSAR, based on test results of engine inspections and cylinder condition monitoring.
"We are pleased that Wärtsilä has confirmed its satisfaction in recent MSAR testing and inspection, and the interim LONO states that no detrimental effects have been shown from MSAR fuel in the Wärtsilä engine,” said chairman, Mike Kirk.
“The outcome is just as we expected – MSAR fuel is safe to use in these diesel engines. It was always anticipated that continued operation to achieve the full 4,000 hours LONO validation, post the interim inspection, would be confirmatory in nature. With the trial having ended early, for reasons unrelated to the use of MSAR(R) fuel, the Wärtsilä Interim LONO reflects the positive results and the exemplary work of the Quadrise team to date.”
Shares rose 11.17% to 4.03p in morning trading.
More targets at Cascabel for SolGold
SolGold plc (LON:SOLG) edged up 3.97% to 39.25p after saying ground magnetic survey results at its Cascabel copper-gold porphyry project in Ecuador revealed “exciting targets”.
The company said there was “exceptionally high-quality product” from 650km of total field data at line spacing of 50m.