UK Banks Get Rate Boost, But Deposit Outflows May Weigh

0954 GMT - U.K. banks have benefited from higher interest rates, but face risks from potential deposit outflows, Barclays says, tweaking some recommendations. Banks are set to achieve record net interest margins and decade-high returns on tangible equity thanks to rate rises, Barclays says. Still, quantitative tightening and escalating deposit competition raise the prospect of deposit outflows, it says. "Here we see Lloyds Banking Group as relatively better-placed given its greater reliance on retail savings," Barclays analysts write. "NatWest may be more exposed given its weighting towards flightier commercial current accounts." Barclays upgrades Lloyds to overweight from equal-weight and increases its price target to 75 pence from 55p. It downgrades NatWest and Virgin Money to equal-weight from overweight. Lloyds shares drop 1% to 53p. (philip.waller@wsj.com)

 
Companies News: 

Diageo Launches Tender Offer to Increase Stake in East African Breweries

Diageo PLC said Monday that it has launched a partial tender offer to increase its stake in East African Breweries PLC to up to 65% from the 50.03% currently owned through its subsidiary Diageo Kenya Ltd.

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Croda International Buys Solus Biotech for GBP232 Mln

Croda International PLC said Monday that it has agreed to buy Solus Biotech from Solus Advanced Materials Co. for around 232 million pounds ($279.7 million) to expand its Asian manufacturing capability.

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Bonhill Gets InvestmentNews Offer, Ends Sales Process; Sees 2022 Revenue Falling

Bonhill Group PLC said Monday that it has concluded a formal sales process and it has received an offer for InvestmentNews LLC, and it expects 2022 revenue to fall.

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88 Energy Raises A$17.5 Mln via Discounted Share Placing

88 Energy Ltd. said Monday that it has raised 17.5 million Australian Dollars (US$12.1 million) via an oversubscribed share placing and will use the money toward the planned Hickory-1 well at Project Phoenix, expansion opportunities and for working capital.

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Seeen to Report Narrowed 2022 Loss Despite Revenue Fall; Secures New Contract

Seeen PLC said Monday that it expects to report narrowed adjusted losses for 2022 despite a fall in revenue, and that it has secured a new contract expected to generate $1 million a year.

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Just Group Says Targets Remain Unchanged Under IFRS 17

Just Group PLC on Monday said that its growth targets, cashflows and dividend policy remain unchanged under the IFRS 17 accounting standards implemented on Jan. 1.

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3i Infrastructure to Raise Funds to Partly Repay Debt, for Investments

3i Infrastructure PLC said Monday that it is planning to raise funds via a share placing and will use part of the money to repay a debt facility and toward future investments.

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B90 Holdings Sees 2022 Revenue of More Than $2.3 Mln; Raises Around $600,000

B90 Holdings PLC said Monday that it expects to report revenue for 2022 of slightly more than 2.1 million euros ($2.3 million) and a narrowed loss on year after the business continued to perform in line with management expectations during the second half.

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Cora Gold to Raise at Least $19.6 Mln to Develop Sanankoro Gold Project in Mali

Cora Gold Ltd. said Monday that it plans to raise at least $19.6 million through an equity fundraising and convertible loan notes, with the proceeds to be used toward the development of the Sanankoro gold project in Mali.

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EKF Diagnostics Sees 2022 Adjusted Ebitda Missing Market Views; CEO Steps Down

EKF Diagnostics Holdings PLC said Monday that it expects to report that 2022 adjusted earnings slightly missed market views, and that Chief Executive Officer Mike Salter will step down immediately.

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Engage XR to Raise up to GBP9.4 Mln via Share Placing, Subscription

Engage XR Holdings PLC said Monday that it is planning to raise up to 9.4 million pounds ($11.3 million) via a share placing and subscription and will use the money toward working capital and general corporate purposes, and for sales and marketing.

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Plant Health Care 2022 Ebitda Loss Narrowed on Higher Revenue

Plant Health Care PLC said Monday that its 2022 core earnings loss narrowed as revenue rose on higher demand for its products.

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Vast Resources Shares Fall on Discounted GBP2.4 Mln Fundraise

Vast Resources PLC shares fell Monday after the company said it has raised 2.4 million pounds ($2.9 million) through a placing and subscription, to be used on its Romanian polymetallic mine.

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Iofina Shares Rise on Expectations for 2022 Earnings Beating Market Views

Iofina PLC shares rose Monday after the iodine producer said it expects to report 2022 earnings materially ahead of market views, with revenue in line.

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Hummingbird Resources' Shares Rise on 4Q Production Boost -- Commodity Comment

Shares of Hummingbird Resources PLC rose 11% on Monday after the company reported a 67% rise in production over the last quarter of 2022 and said that it expects improved cash flow generation and a stronger balance sheet this year. Here's what the AIM-listed mining company had to say:

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Sosandar Nonexecutive Chairman Bill Murray Dies

Sosandar PLC said Monday that Nonexecutive Chairman Bill Murray died over the weekend.

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Oracle Power Shares Drop on Discounted Share Placing

Shares in Oracle Power PLC fell 19% on Monday after the company said it has raised 500,000 pounds ($602,800) via a discounted share placing, with the proceeds to be used to support the development of its green-hydrogen project in Pakistan.

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Zamaz Shares Rise After Termination of Convertible Loan Note Facility

Zamaz PLC shares rose Monday after it said it has terminated its convertible loan note facility with Atlas Capital Markets through mutual agreement.

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Eqtec Expects to Meet 2022 Revenue Guidance

Eqtec PLC said Monday that it expects 2022 revenue to meet guidance.

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Trellus Health Chairman Steps Down, Daniel Mahony Named Successor

Trellus Health PLC said Monday that Nonexecutive Chairman Julian Baines will stand down from the board with immediate effect, with Senior Independent NonExecutive Director Daniel Mahony named successor.

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Greatland Gold Names New COO, Chief Development Officer

Greatland Gold PLC said Monday that it has appointed Simon Tyrrell as chief operating officer and Jeremy Meynert as chief development officer.

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Shanta Gold Names Michal Devine as New CFO, Honest Mrema as COO

Shanta Gold Ltd. on Monday said Michal Devine will become chief financial officer on March 23 as Luke Leslie steps down from the role to pursue other opportunities.

 
Market Talk: 

Informa Seen With Robust Outlook, GBP1 Bln for M&A

1055 GMT - Informa's 2022 performance was comfortably better than guidance and the outlook for 2023 is robust, Citi's Thomas Singlehurst says in a research note. The FTSE 100 events-and-academic publishing group's key attraction is that the bulk of the anticipated upside in the equity is likely from continued earnings growth, both organic--as post-pandemic recovery gains momentum and broadens geographically--and inorganic as it is seen with upward of GBP1 billion for deals, he says. At full-year results in March the company should comment more on both the outlook and plans for capital deployment, he adds. Citi has a buy rating on the stock with a target price of 720 pence.(kyle.morris@dowjones.com)

Vesuvius Cyberattack Impact Seen as Limited

1050 GMT - The impact on Vesuvius of the cyberattack incident it is dealing with is likely to be a one-off, RBC Capital Markets says. The incident follows an attack on Morgan Advanced Materials last month and an incident for Weir Group in late 2021, the Canadian investment bank says. The U.K. engineered-ceramics manufacturer has given few details at this stage, and comparisons are limited; in a potential worst case scenario, Weir for example ended up with a GBP5 million exceptional charge to deal with the attack, RBC analysts say in a research note. "Any impact is by nature likely to be more of a one-off, so should be relatively limited when thinking about group valuation," RBC says. RBC retains its outperform rating and 540-pence price target on Vesuvius' stock. Shares are down 3.7% at 403.4 pence. (joseph.hoppe@wsj.com)

Virgin Money Could See Intensified Headwinds

1043 GMT - Virgin Money UK's recent strength is likely to be temporary and the financial-services company's relative challenges could worsen, says Berenberg in a note. "We, nevertheless, remain concerned that the bank's deposit mix will constrain its net interest margin as interest rates rise (which is well understood) and exacerbate volume headwinds (which is less well appreciated)," says analyst Peter Richardson. Virgin Money's weaker current account franchise relative to larger peers will incrementally constrain its ability to grow mortgages, he says. Berenberg raises its target price to 195 pence from 170 pence on better near-term revenue estimates but notes a material rerating is unlikely and reiterates its hold rating. Shares fall 2.7% at 189.3 pence. (elena.vardon@wsj.com)

Iofina Set for Further Sales Momentum in 2023

1038 GMT - Iofina now expects 2022 Ebitda of no less than $10.5 million, a strong figure that includes solid sales and profitability in December, Canaccord Genuity says. The iodine producer's strong 2022 results were made with sales of less than 450 metric tons of iodine, as compared with production volumes of 516 tons, the financial services company says. In 2023, sales should be even closer to meeting production levels, which are seen around 550 tons, Canaccord analyst Alex Brooks says in a research note. "Given the strong cash flow and attractive growth prospects we are lifting our price target to 37.5 pence [from 35 pence]; we remain buyers," the Canadian investment bank says. Shares are up 12% at 27.45 pence. (joseph.hoppe@wsj.com)

Hargreaves Lansdown Faces Consumer, Competition Hurdles

1021 GMT - Hargreaves Lansdown faces pressure from the cost-of-living crisis, competition and inferior growth, Credit Suisse says, downgrading the financial-services firm to underperform from neutral. Most of HL's funds are falling short of one, three and five-year benchmarks and flows may struggle to recover as savers face increasing economic pressure, the Swiss bank says. Meanwhile, economic turbulence looks set to compound a difficult competitive pricing position in HL's fund and stockbroking businesses, it says. On valuation, HL trades broadly in line with similar European peers, but offers a significantly lower 2022-25 earnings-per-share growth outlook, Credit Suisse says, also cutting its price target to 800 pence from 900p. HL shares fall 3% to 920p. (philip.waller@wsj.com)

Just Group Is in the Sweet Spot, RBC Says

0940 GMT - Just Group's IFRS 17 hurdle is cleared, RBC Capital Markets says in a note after the specialist financial-services company said the new accounting standards won'tits strategy, capital or cash. Just Group reiterated its growth and return on equity targets, which had been an area of investor concern given the material change in recognition of new business profit under IFRS 17. "We see Just Group as being in the sweet spot of the attractive themes in insurance: there is unprecedented demand for bulk annuities, its main product; it is a major beneficiary of Solvency II reform; and we expect longevity releases equivalent to 34% of the market capitalization," RBC says, rating the stock outperform. (elena.vardon@wsj.com)

 

Contact: London NewsPlus; paul.larkins@wsj.com

(END) Dow Jones Newswires

February 06, 2023 06:17 ET (11:17 GMT)

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