BTG PLC (LON:BTG) shares jumped 10% to 661p after the healthcare company reported solid first half results and raised its expectations for the pharmaceuticals division.
First-half revenues increased 12% to US$495.7mln, while adjusted operating profits shot up by a third to US$178.5mln.
The group reiterated its full-year guidance for Interventional Oncology and Vascular sales and upgraded its Pharmaceuticals sales guidance following a good first half after a “very strong” October for its CroFab snake bite antivenom.
The treatment, which neutralises the effects of bites from rattlesnakes other pit vipers, generated sales of US$107.2mln in the six months ended September 30 (H1 17: US$102.9mln), helping to drive pharmaceuticals revenues up 7% to US$167.9mln (H1 17: US$156.4mln).
But the snakebite seasons runs through until October, when BTG saw a spike in demand for CroFab. As a result, BTG now expects a “low single-digit increase” in pharmaceuticals sales this year.
On the downside, Interserve PLC (LON:IRV) slumped for the second day in a row after shares hit a 30-year low on Monday.
The shares were down 4.5% to 37.5p at the time of writing after a former shareholder told the BBC the outsourcing firm would struggle to raise the extra capital it needs.
The news comes in the wake of the collapse of sector peer Carillion with worries that similar businesses could follow suit.
The former Interserve shareholder told the BBC on Tuesday: "We could be looking at another Carillion. I don't see how they can raise the £500mln or so needed.”
1.30pm: Ascent Resources ascends and iEnergizer surges
Shares in iEnergizer Limited (LON:IBPO) surged after the firm reported first-half underlying earnings (EBITDA) growth of 39%, boosted by higher margin work and product launches.
The outsourcing group reported an EBITDA for the period of US$24.3mln, up 39.1% year-on-year, while service revenues climbed 9.5% to US$82.4mln.
READ iEnergizer surges as higher margin work and new products push earnings up 39%
Net debt at the end of September had been whittled down to US$18.5mln from US$26.5mln at the end of March.
Proving that banks are mostly only interested in lending money to companies that don’t need it, iEnergizer said a number of offers have been received to refinance the company's existing term loan on the back of its strong cash generation.
“Subject to the completion of satisfactory due diligence and the signing of one of these offers, the board is very pleased to inform the market of its intention to return to the dividend list.
The news sent shares 14.3% at 120p.
Ascent Resources Plc (LON:AST) was living up to its name, rising 15% to 0.575p on ministerial developments in Slovenia, where the company and its partners have ploughed the best part of €45mln into operations and exploration over nearly a decade.
The company said the general director of the Slovenian Environmental Agency, known as ARSO, has resigned his post.
“As previously reported the permitting process, managed by ARSO, has been ongoing since 2014. We have been deeply disappointed for some time at the way the permitting process has been carried out by ARSO, including the misapplication of legislation which resulted in the Administrative Court ruling in 2016,” Ascent said.
“This resulted in the partners, through no fault of their own and at considerable cost, having to effectively reapply for a permit which had already been subject to a lengthy public consultation and approved by ARSO and the (then) Environment Minister,” the company griped – with justification – in its stock market announcement.
Clearly, the company is hoping the new minister will be less of a complete ARSO than the previous one.
“We have requested a meeting with the minister to understand how the permits necessary for the future development of the field can be processed without further unnecessary delay to a process which has already gone on much longer than should have been the case,” the company said.
11.00am: Vodafone wanted as dividend cut fears wane
Interest in Vodafone PLC (LON:VOD) shares appeared to taper off once it sold its stake in Verizon Wireless but it was back in the spotlight this morning.
The stock was the best performing Footsie stock this morning after some reassuring interims.
READ Vodafone slumps to first-half loss but on track to meet full-year earnings guidance
“Vodafone has been sending out a weak signal of late, but there are some indications that the telecoms giant is coming to grips with its issues,” said Richard Hunter, the head of markets at interactive investor.
The operating loss of €2.07bn, versus a profit the year before of €2.01bn, was eye-watering and “largely caused by its ill-fated foray into Vodafone India, as well as write-downs in Spain,” Hunter said.
“Meanwhile, net debt is running high and has risen by over 6% to stand currently at some 32.1 billion euros, group revenues have drifted by 5.5% and, inevitably, the earnings per share metric has also taken a hit given these inputs. Foreign exchange headwinds are an additional challenge, as is the increased effective tax rate which the group is now facing,” Hunter continued, before getting on to what Vodafone shareholders will regard as the good bit.
“Nonetheless, bulls of the stock may well see this as something of a turning point. More positively, the increased free cash flow figure of €5.4 billion is both welcome and above expectations and should mean that previous concerns around the dividend should dissipate.
"Indeed, a current and projected dividend yield of over 9% is a clear invitation to income seeking investors, with the fact that the dividend has been held being seen as a prudent move whilst net debt is addressed,” Hunter said.
The shares were up 9.2% at 157.64p, so the dividend yield won’t be as enticing as it was but it is still worth a second look.
“There are two reasons these results are going down well with the market,” said George Salmon, an equity analyst at Richard Hunter’s old stomping ground of Hargreaves Lansdown.
“Reducing operating costs for a third consecutive year has helped earnings come in slightly ahead of prior expectations, while the group’s confirmed a marginally more upbeat outlook for the full year. That’s helped ward off fears of an imminent rebasing of the dividend – clearly good news for those holding Vodafone for its 8%+ yield,” Salmon said.
#VODAFONE stock has surged almost +10%, despite many negatives in H1 report. 1 way to make sense of this: it's a relief rally. Cost cut plan, including possible sale of towers and frozen dividend, means $VOD can keep 8%-plus yield that puts it in top 5 FTSE dividend payers ^KO
— Ken Odeluga (@TheSquareMile) November 13, 2018
“Moves to make Vodafone simpler have also been given the thumbs up. Not only should the plans open the door to cost savings, a sale of the Towers business could see a couple of billion flow into the coffers. With debts well over €30bn at the moment, anything that lightens the burden is welcome.
“However, longer-term challenges remain. The cash demands of rolling out 4G and 5G services will be significant, so while these results provide some welcome short-term assurance, questions over the sustainability of the dividend will likely linger,” Salmon ventured.
9.20am: FirstGroup heading in the right direction; Haydale sends out strong signals
The shares of passengers shifter FirstGroup PLC (LON:FGP) were among the best performers in the first hour of trading, rising 7% to 85.25p.
Whether that was because the company has filled the vacancy that existed in the chief executive officer role, promoting from within, or because of the interim results it released, is hard to say.
“The interim results were ahead of our forecasts, although the strong seasonal bias towards H2 means they are not terribly meaningful overall. This reflects the lack of revenue at First Student during the school summer holidays (which fall wholly in H1), along with additional costs associated with the start-up of operations at the beginning of the new school year in September,” said Liberum Capital Markets, which rates the shares a ‘buy’.
“Compared with our forecasts, there was encouraging progress at First Student, UK Bus and Transit, but Greyhound was short of our forecasts and has continued to deteriorate. In absolute terms, margins still leave much to be desired, with most divisions still below long-term target levels (UK Bus operating margin 5.7% vs. peers achieving double-digits, Transit margin 4.7% vs. 7% target), while Student’s seasonality limits the meaningfulness of the good performance in H1,” the broker added.
Revenue rose by 19.2% to £3.30bn from £2.77bn in the corresponding period of 2017.
Headline profit before tax was up 37.7%, or by 63.4% on a constant currency basis, to £42.0mln from £30.5mln the year before.
The group said it has completed the review of its troublesome Greyhound bus division and has launched a plan to revitalise what is the smallest part of the company’s business.
Haydale Graphene Industries PLC (LON:HAYD) is to work with Star RFID in Thailand to develop graphene and silver-based-inks for the printed Radio Frequency Identification (RFID) market.
The co-development is expected to lead to a supply and collaboration agreement in the coming months.
Haydale’s shares shot up 12.2% to 13.75p on the news.
Other Proactive news headlines:
Tissue Regenix Group PLC’s (LON:TRX) subsidiary, CellRight Technologies, has expanded its relationship with orthopaedic solutions company Arthrex Inc with a new pan-European distribution agreement.
The Aoka Mizu floating production storage and offloading vessel, which is on its way to Hurricane Energy PLC’s (LON:HUR) Lancaster field development off the west coast of the Shetland Islands, has put into Algeciras, Spain for planned personnel changes and bunkering.
Communications and information technology services provider AdEPT Technology Group PLC (LON:ADT) is trading in line with expectations, with the board “delighted” by progress.
Kodal Minerals PLC (LON:KOD) has hit mineralisation in diamond drilling at the Sogola-Baole and Boumou prospects in southern Mali.
Mosman Oil And Gas Limited (LON:MSMN) said a test recently performed on the producing Stanley-1 well in the US clearly shows potential for higher flow rates once current gas constraints are removed.
Oriole Resources PLC (LON:ORR) has made substantial progress in its appeal against an HMRC decision to make it pay VAT on overseas activity that involved the support of exploration. A £557,000 provision made in the 2017 accounts is now likely to be released.
A well site survey at Dunquin South in the Irish Atlantic Margin has been approved by the licence consortium, said Providence Resources PLC (LON:PVR). Dunquin South lies within the Porcupine Basin on licence FEL3/04 and the survey is a pre-requisite for a first exploration well, added Providence.
The UK regulator has completed its review of the Environmental Statement submitted in regard to the proposal to drill the Colter appraisal well and has agreed in principle to grant consent to drill. United Oil & Gas PLC (LON:UOG) holds a 10% interest in the well, which is operated by Corallian Energy.
Sareum Holdings PLC (LON:SAR), the specialist small molecule drug development company, announced the appointments of Michael Owen and Clive Birch as non-executive directors. Owen is the co-founder and first CSO of biopharmaceutical firm Kymab Ltd, prior to which he worked for GlaxoSmithKline PLC (LON:GSK), where he was SVP and Head of Research for Biopharmaceuticals R&D. Birch is an Independent non-executive director of Cambridge Innovation Capital PLC, a Cambridge-based builder of technology and healthcare companies.
ECR Minerals PLC (LON:ECR), the precious metals exploration and development company, has published a new corporate presentation, and in addition, reflecting interest in the Sierra de las Minas gold project in La Rioja, Argentina, the group has also prepared a project-specific presentation in both English and Chinese which may be viewed on its website.