Broker Upgrades and Downgrades & Key UK Corporate Snapshots 02 February 2016

UK Broker Upgrades / Downgrades

US Broker Upgrades / Downgrades

Key UK Corporate Snapshots Today

3i Infrastructure Plc (3IN.L)  Announced, in its performance update for the period from 1 October 2015 to 31 December 2015, that the portfolio continues to perform well and generated portfolio income of £14.5 million for the period, including £2.9 million from the company’s recent investments in ESVAGT and the West of Duddon Sands Offshore Transmission Owner project. Total portfolio income for the nine months to 31 December 2015 was £41.6 million. This compares to £60.9 million for the nine months to 31 December 2014, which included £27.1 million of income received from Eversholt Rail, which was sold in April 2015. The company continues to manage its balance sheet efficiently and has cash balances of £40.3 million, and an undrawn facility of £284 million available for new investment. As announced on 6 November 2015, and following approval from the Jersey Financial Services Commission, Richard Laing joined as Chairman of the company’s Board of Directors on 1 January 2016.

Amec Foster Wheeler Plc (AMFW.L)  Announced that it has been awarded a prime contractor position on the Air Force Civil Engineer Center (AFCEC) Architect-Engineering (A-E) 2013 services contract by the U.S. Air Force for seven years starting September 2015. The indefinite-delivery/indefinite-quantity contract outlines the full range of A-E services to administer, coordinate and technically support the Air Force Civil Engineer’s Military Construction, Military Family Housing (including military housing privatisation initiatives), Sustainment, Restoration, and Modernisation programme, and other areas of essential support worldwide.

Amiad Water Systems Limited (AFS.L)  Announced that the momentum in the Irrigation segment in H1 2015 was sustained into the second half of the year, largely driven by increased sales of the Company’s new Omega and Sigma products. The Oil & Gas segment continued to improve due to growth in sales in the US and EMEA territories. However, the Industrial and Municipal segments continued to face headwinds, mainly due to the global macroeconomic conditions. Consequently, the Company expects to report H2 2015 revenues broadly similar to H1 2015 resulting in full year 2015 revenues being marginally ahead of market expectations. In 2015, the management team’s focus was on generating profits through expanding the business and maintaining tight cost control. The restructuring and cost cutting exercise that the Company commenced at the end of 2014 yielded better than expected results. The Company also saw gross margins improve due to efficiency gains in the manufacturing process and product mix. As a result, the Company expects to return to profitability for FY 2015 and report strong profit before tax above market expectations. The impact of foreign currency exchange rates was broadly neutral as the benefit from the US Dollar (USD) improving against the New Israeli Shekel was offset by a decrease of the EURO and Australian Dollar compared with the USD. Net income is also expected to be markedly improved, above market expectations, due to a change in the mix of income between the group entities and utilising losses in previous years resulting in a lower consolidated income tax rate. Due to the improved performance of the Company and a decrease in working capital, it expects to report solid reduction in net debt that is significantly better than market expectations. Meanwhile, the Company will provide fuller details at the time of its full year results.

Benchmark Holdings Plc (BMK.L)  Announced, in its preliminary results for the year ended 30 September 2015, that its reported revenue stood at £44.2 million, compared to £35.4 million in the preceding year. Loss net of tax was £11.8 million compared to £1.3 million. The company’s diluted loss per share was 5.96p, compared to 1.04p.

BGEO Group Plc (BGEO.L)  Announced the combination of its Corporate Banking and Investment Management businesses into a Corporate Investment Banking business (“CIB”). The merged business will leverage its superior knowledge and capital markets capabilities in the Georgian and neighbouring markets both in terms of reach and the expertise. It expects to grow its fee income, improve the Bank’s ROAE and reduce concentration risk in the corporate lending portfolio. Reflecting this change, the Group will report CIB business results separately starting in the first quarter 2016. Archil Gachechiladze, currently Group CFO and Deputy CEO, Investment Management at the Bank is to lead the merged business, replacing Sulkhan Gvalia, currently Deputy CEO, Corporate Banking, who is leaving the Bank with immediate effect. Archil will step down from his present position of Group CFO and Levan Kulijanishvili, a long-standing professional, and currently Deputy CEO, Finance at the Bank will also undertake the responsibilities of Group CFO. BGEO Group also announces the appointment of Tornike Gogichaishvili, currently Chief Operating Officer at the Bank, as Deputy CEO Operations at the Bank. The new appointments are effective immediately, following regulatory approval from the National Bank of Georgia.

BP Plc (BP..L)  Announced, in its December 2015 full year results, that total revenues and other income dropped to $225,982 million from $358,678 million recorded in the previous year. Loss after tax stood at $6,400 million, compared to a profit of $4,003 million. In its fourth quarter results for the period ended 31 December 2015, BP announced that total revenues and other income declined to $49,233 million from $75,096 million recorded in the same period a year ago. Loss after tax narrowed to $3,324million from $4,373 million. The board announced a quarterly dividend of 10.00 cents per ordinary share. Net debt as at 31 December 2015 was $27.2 billion, compared with $22.6 billion a year ago. On the outlook front, the group expects full-year 2016 underlying production to be broadly flat with 2015. Also, it expects first-quarter 2016 reported production to be broadly flat with the fourth quarter 2015 and refining margins to be lower than the fourth quarter. Also, the company stated that oil prices continue to be challenging in the near term. Additionally, the group expects annual organic capital expenditure to remain between $17 and $19 billion in 2016 and 2017 and to be at lower end of that range in 2016. Also, it expects to reduce number of staff and contractor roles in Upstream segment by around 4,000 during 2016 and around 3,000 from Downstream segment by end of 2017.

Camellia Plc (CAM.L)  Announced, in its pre-closing trading update for the year ended December 2015, that it expects the headline profit before tax for the year to be mostly in line with market expectations. Tea prices in Kenya strengthened during the first half of 2015 and remained significantly higher than those experienced in 2014 during the second half of the year. Moreover, the prices for the avocado and macadamia crops also exceeded expectations. However, the company suffered a setback by the impact of newly enacted legislation in Bangladesh which requires companies to make a payment on retirement to all employees, based upon compensation and length of service. The company will have to make an appropriate provision for approximately 18,000 of its employees in Bangladesh, which is estimated to amount to £6.5 million as at 31 December 2015.

Ceres Power Holdings Plc (CWR.L)  Announced that it has signed a new evaluation agreement for its Steel Cell Technology with a leading global Original Equipment Manufacturer.

Craneware Plc (CRW.L)  Announced a significant new contract with a hospital operator in the US. The company is also pleased to announce the signing of an exclusive value added reseller agreement with US-based automated payment technologies and services company, VestaCare. The company will combine VestaCare’s proprietary technology with its own to offer accelerated payment and patient engagement solutions.

FastForward Innovations Limited (FFWD.L)  Announced that SatoshiPay Ltd (“SatoshiPay”), in which FastForward has a 10% interest, announced the launch of a platform for web publishers offering a new way to monetise content through frictionless micropayments. SatoshiPay’s payment technology allows users to transact amounts as small as €0.01 or less, which SatoshiPay refers to as “nanopayments”, by leveraging blockchain technology. Lorne Abony, CEO of FastForward stated that the announcement represents a major step in that Company’s path towards the commercialisation of its disruptive technology.

Greene King Plc (GNK.L)  Announced that Tim Bridge, Chairman of the company, will retire from the board on 1 May 2016. The company also announced that Philip Yea has joined the board with effect from 2 February 2016 as a Non-Executive Director, and then will take over as Chairman on 2 May 2016.

Home Retail Group Plc (HOME.L)  The Boards of J Sainsbury plc and Home Retail Group plc announced that they have reached agreement on the key financial terms of a possible offer for Home Retail Group by Sainsbury’s. Under the terms of the possible offer Home Retail Group shareholders would receive per Home Retail Group share 0.321 new Sainsbury’s shares and 55p in cash. In addition, Home Retail Group shareholders would receive payments of approximately 25p (the “Homebase Capital Return”); and 2.8p in lieu of a final dividend in respect of the financial year ending 27 February 2016 (the “Additional Capital Return”).

Mattioli Woods Plc (MTW.L)  Announced, in its interim results for the six months ended 30 November 2015, that revenues rose to £19.9 million from £16.6 million recorded in the same period a year ago. Profit after tax widened to £2.3 million from £2.1 million. The Board recommended the payment of an increased interim dividend, up 15.3% to 3.85p per share (1H15: 3.34p).

Minds + Machines Group Limited (MMX.L)  Announced, in its unaudited trading update for the 12 months ended 31 December 2015, that during Q4 2015, the Company saw significant unaudited billings* growth in both standard and premium names as a result of the Company’s ongoing transition into a sales-led business, the launches of .law, .abogado and .miami, and the first-year renewals of .london previously reported. For the final quarter, standard name billings were up 184% at $2.66 million (Q3 2015: $0.94 million) while premium name billings were up 215% at $1.52 million (Q3 2015: $0.48 million). At the year-end, total billings for the year rose 57% to $7.92 million (FY2014: $5.03 million) – with standard name billings accounting for $4.86m, premium name billings $2.94 million and other billings $0.12 million. Additional gross receipts for the year from one-off private gTLD auctions amounted to $9.15 million (FY2014: $37.5 million). At the year end, total domains under management within the Company’s registry increased 28% to 278,523 (Q3 2015: 216,820) and 158% on the year (FY2014: 108,000) – representing 2.5% of the new gTLD market which grew from 3,710,349 registered domains at 1 January 2015 to 11,191,542 at the year end, fuelled by significant growth in China in the second half of the year. The company in its operation update mentioned that during Q4, the executive team continued to improve the Company’s business model with the goal of ensuring the most efficient and effective operating structure for the business and its stakeholders moving forward. To deliver further efficiencies to those already announced, the executive team continues to engage with third-party partners to drive greater cost efficiencies and scalability. The Company will continue to keep shareholders updated on this activity as it progresses. Also, it launched three new gTLDs – .law, .abogado and .miami; advanced negotiations which resulted in the acquisition of .boston in January 2016; developed its market entry strategy for China with a Q1 launch expected; developed new marketing strategies and sales tactics across its existing portfolio for standard and premium names, bearing initial fruits in Q4 with larger benefits expected in 2016; developed a schedule for launching up to 5 new top-level domains in 2016, the timings of which will be announced on a rolling basis through-out the year; and post-period, has seen .work pass 100,000 registrations.

Mirland Development Corporation Plc (MLD.L)  Announced that it held a meeting on 31 January 2016 with the trustees of the Company’s Series A-F bonds (the “Trustees”) at which certain terms of the Proposed Restructuring Plan as announced on 17 November 2015 were discussed in light of the recent, further sharp decline in the exchange rate of the Russian Rouble against the US Dollar. At this stage, no agreement has been reached with the Trustees.

NWF Group Plc (NWF.L)  Announced, in its half year results for six months ended 30 November 2015, that revenues fell to £224.6 million from £247.1 million posted in the same period preceding year. The company’s profit before tax stood at £1.8 million, compared to a profit of £2.1 million reported in the previous year. The basic earnings per share stood at 4.3p compared to earnings of 4.0p reported in the previous year. The company further stated that the board has approved an interim dividend of 1.0p per share (H12014: 1.0p), payable on 3 May 2016 to shareholders on the register on 29 March 2016.

Ocado Group Plc (OCDO.L)  Announced, in its final results for 52 weeks ended 29 November 2015, that revenues jumped to £1107.6 million from £948.9 million posted in the same period preceding year. The company’s profit before tax stood at £11.9 million, compared to a profit of £7.2 million reported in the previous year. The basic earnings per share stood at 2.01p compared to earnings of 1.24p reported in the previous year. The company’s cash and cash equivalents stood at £45.8 million (2014: £76.3 million).

PipeHawk Plc (PIP.L)  Announced that it has been awarded a further major contract with Dana UK Axle Ltd, a subsidiary of Dana Holding Corporation to deliver a turnkey system for the final assembly of vehicle axles at its Birmingham, UK facility for over £400,000. Following on from the award of the previous contract in December 2015, this new contract continues the development of the relationship between QM Systems and Dana UK Axle Ltd in providing state-of-the-art turnkey production and test solutions. The project is due for delivery by the end of Q2 2016.

Plexus Holdings Plc (POS.L)  Announced that it has secured a purchase order with Talisman Malaysia Limited (‘Talisman’), which is a part of REPSOL Group, the integrated global energy group, to supply its best in class wellhead system for an exploration well offshore Malaysia. This contract is in line with Plexus’ expansion strategy to increase its global presence as a leading supplier of best in class wellhead equipment in terms of performance, reliability and safety for exploration, production and subsea activities.

Premaitha Health Plc (NIPT.L)  Announced its partnership with Leeds Teaching Hospitals NHS Trust to provide a private non-invasive prenatal screening service for pregnant women in the region.

Rambler Metals & Mining Plc (RMM.L)  Announced that it has delivered approximately 8,000 wet metric tonnes of copper and gold concentrate from its facility in Goodyear’s Cove, NL, Canada. This is the twelfth shipment completed to date since declaring commercial production, bringing the total concentrate delivered to approximately 78,000 wmt. Following the shipment, the company had approximately 700 wmt of concentrate in storage at its Goodyear’s Cove Facility.

Renew Holdings Plc (RNWH.L)  Announced that Places for People Group Limited completed the acquisition of Allenbuild Limited yesterday with the payment of the second 50% of consideration of £1.375 million in cash. This follows on from the initial announcement of the disposal of the business for a total consideration of £2.75 million made on 3 November 2014.

St. Modwen Properties Plc (SMP.L)  Announced, in its final results for the year ended 30 November 2015, that its reported revenue stood at £287.5 million, compared to £266.5 million in the preceding year. Profit after tax was £217.3 million compared to £120.0 million. The company’s diluted earnings per share was 90.4p, compared to 49.9p. It also announced that Bill Oliver has informed the Board of his intention to retire as Chief Executive. Bill will leave on 30th November 2016, at the end of the Company’s financial year after 13 years as Chief Executive and 17 years on the Board.

TalkTalk Telecom Group Plc (TALK.L)  Announced, in its Q3FY16 trading update, that its revenue grew by 1.8%; on-net net adds -101k, business returning to normal – positive RGU growth in January, free upgrade offer more successful than expected, cyber attack – trading impact £15 million; exceptional costs £40 million-£45 million, FY16 EBITDA guidance £255 million-£265 million; expect to grow final dividend by 15% and FY17 EBITDA guidance £320 million – £360 million, with dividend no lower than in FY16.

Total Produce Plc (TOT.L)  Announced that it has acquired a 65% equity stake in Progressive Produce LLC, headquartered in Los Angeles, California. Progressive Produce is a grower, packer and distributor of conventional and organic produce to the retail, wholesale and foodservice sectors in the U.S. and Canada. The purchase consideration will be satisfied by an initial payment on closing. In addition, a further payment will be made in 2019 contingent on the achievement of future profit targets. Total Produce expects the investment to be earnings enhancing from the date of closing. Long term put and call options are in place for the remaining 35%. Jim Leimkuhler (President), Victor Rodarte (Vice President) and Jack Gyben (Vice President) will remain as equity holders of the business and will continue to be key members of the executive management team.

Tullett Prebon Plc (TLPR.L)  Announced the clearance sought from the United States Department of Justice in connection with the Transaction of proposed acquisition. The company has received a request for additional information and documentary material from the Department of justice. Moreover, the completion of the transaction remains subject to the approval of company’s shareholders, the approval of ICAP shareholders, clearance from the Competition and Markets Authority.

UDG Healthcare Plc (UDG.L)  Announced, in its trading statement, that the group has made a strong start to the financial year with trading for the quarter to 31 December 2015 well ahead of the prior year. Trading across the Ashfield division has again been strong. The positive trading momentum in the Sharp US business has continued during the first quarter. Operating profits in Aquilant were slightly ahead of the same quarter last year. The disposal of the United Drug Supply Chain and MASTA businesses was approved by shareholders on 13 October 2015. Based on the underlying trading performance to date, it expects constant currency adjusted diluted earnings per share (EPS) for the continuing Group for the year to 30 September 2016 to be between 6% and 8% ahead of last year’s continuing Group EPS of 27.4 cents. The Group also reiterates its dividend guidance for FY16. The Group expects to deliver a good underlying cashflow performance for the year.

Ultra Electronics Holdings Plc (ULE.L)  Announced that Mary Waldner, Ultra’s Group Finance Director, will join the Board of Oxford Instruments Plc as an Independent Non-Executive Director with effect from 4 February 2016.

Wizz Air Holdings Plc (WIZZ.L)  Announced that it continued to expand its customer offering and network with the following announcements: The airline announced 11 new routes in January: Romania (x3), Poland (x3), Bulgaria (x1), and Hungary (x4). It also announced a doubling of flights from Budapest to Lisbon to four times a week starting in March. Additionally, the company celebrated passing the two million mark of passengers carried through Skopje and Ohrid in Macedonia. Also, the company mentioned that it recorded a 21.0% increase in passengers in January 2016, compared to the same month last year.