MOVERS OF FRIDAY 20 NOVEMBER 2020

Francesca Morgan
Market Report
16:30, 20th November 2020

Energean (LON:ENOG) ticked up 5.36% to 715.15p as it highlights ‘solid progress’ 

The gas-focused E&P group which holds operations offshore Israel, Greece and the Adriatic released a positive trading update on Tuesday highlighting ‘solid progress’ over 3Q20 with Karish, its flagship gas project in Israel, which is scheduled to deliver first gas in 4Q 2021. 

As at 26 October 2020, the Karish development was 85% complete. Energean said the project's economics, cash-flows and returns profile have been ‘further enhanced’ by increasing firm gas sales increasing the expected hydrocarbon liquids production plateau. 

The company is also working towards completing its acquisition of Edison E&P next month which it said will, alongside Karish, ‘further secure its long-term, resilient cash flow profile.’ 

Following the acquisition, around 70% of future production will be sold under long-term gas sales agreements that will largely insulate revenues against commodity price volatility and enable it to realise its medium-term ambition to pay a meaningful and sustainable dividend.  

“We have also switched to 100% renewable energy in powering our assets in Prinos, which has driven a 100% reduction in the asset's Scope 2 carbon emissions and an approximate 45% reduction of Scope 1 & 2 carbon emissions,” said Mathios Rigas, CEO of Energean. 

Energean said it is exploring opportunities to roll this strategy out across all operated assets in the post-completion portfolio, which will mark a near-term step towards its net zero goal. 

Commenting on this net zero goal, Rigas added, “We are confident that we can achieve this target and are also assessing a number of other options that would leverage our upstream expertise, such as carbon capture and storage, to help to deliver a lower carbon world." 

ENOG price chart

ImmuPharma (AIM:IMM) shares jumped 23.46% to 13.57p after announcing that its US partner is to meet with FDA in December regarding the phase III Lupuzor™ trial 

The specialist drug discovery company said Avion Pharmaceuticals, its licensing partner for Lupuzor™, will meet with the US Food & Drug Administration ("FDA") next month to discuss guidance on the forthcoming international Phase 3 trial of Lupuzor™ in Lupus patients. 

The US FDA has now confirmed the date of 4 December 2020 for a Type 'A' Meeting Request, with Avion where the latter will ask the FDA for guidance on the study design, clinical end points and approval process for Lupuzor™ while its Phase 3 trial is underway. 

ImmuPharma and Avion have worked closely on the clinical trial design and strategy since  they signed an agreement in November 2019 for Lupuzor™, with Avion agreeing to fund a new international Phase III trial and commercialise the treatment in the United States.  

Last week, ImmuPharma reported that Avion had asked the US FDA to consider the conditional approval of Lupuzor ahead of the completion of the final-stage clinical study. 

An approval, which would allow Lupuzor™ to be marketed before the completion of a new Phase 3, would be based on the ‘clinically significant data’ generated in the completed Phase 2 and 3 clinical trials to date that showed the treatment was ‘safe and well tolerated.’ 

In anticipation of the start of the new Phase 3 clinical trial, ImmuPharma said last week that it had initiated the production of a new batch of the Lupuzor™ drug specifically for the trial. 

IMM price chart

Webis Holdings (AIM:WEB) shares rose 21.43% to 1.7p with licence renewal 

The group, which is the operator of WatchandWager Cal Expo, the Californian harness track, said its Advanced Deposit Wagering business, WatchandWager.com ("WatchandWager") has now received a two-year licence approval from the California Horse Racing Board. 

The licence renewal is for the years 2021-2022, and it allows WatchandWager to continue to accept online pari-mutuel wagers from residents of California on its range of global content. 

Webis sees the renewal as ‘strategically important’ for US access and for a potential offering of sports betting to California residents when the state legislature passes this into law. 

The licence also sits alongside Webis’ long-term lease of the Cal Expo racetrack, ‘adding an important physical, as well as on-line, presence in the state,’ it told investors this morning. 

“We believe that the tax, revenue, and jobs generated from this license will have an important benefit to the state of California, especially in light of the economic difficulties caused by the California wildfires and COVID-19,” said Ed Comins, President of WatchandWager. 

WEB price chart

Velocity Composites (AIM:VEL) jump again by 21.05% to 23p despite low expectations

Shares in the supplier of advanced composite material kits to the aerospace sector have soared today despite reporting on Tuesday that it expects to post a full-year loss for FY20. 

Despite trading for the first four months of the year to 31 October 2020 being in line with management expectations, the remainder of the year was impacted by the pandemic.  

The Company said it anticipates sales revenues for the year to 31 October 2020 will be approximately £13.6m (FY2019: £24.2m) and that it expects to report an adjusted EBITDA Loss(1) for the year of approximately £1.8m (FY2019:Adjusted EBITDA  £0.6m). 

While current activity levels for the business seem "challenging", Velocity said it remains “cautiously optimistic" over future growth prospects.  

‘Even with a slow recovery in build rates, and with further disruption throughout this winter, it is now once again realistic to foresee growth in the future,’ the company told investors. 

It said it is now highly ‘operationally geared, such that any significant recovery in activity, even if only to below pre-pandemic levels, will have a strong positive impact on future profitability. ‘ 

VEL price chart

Micro Focus International (LON:MCRO) fell 4.99% to 332.1p despite forecasting higher margins 

Shares in the global software firm fell today despite telling investors this week that it expects adjusted EBITDA margin to be ‘toward the upper end’ of expectations for FY20. 

The company expects to report revenue of around $3bn for FY20, which it considers to be in line with management expectations despite representing a 10% year-on-year fall from FY19. 

Cash flow performance was strong, underpinned by effective working capital management, while Micro ended the period with $0.7bn cash and $4.2bn net debt by 31 October 2020. 

In total, the Group had $1.1 billion of available liquidity as at 31 October 2020 and, following the successful refinancing, the next facility maturity date is June 2024, it told investors. 

“We are now nine months into our three-year turnaround plan for the Group and whilst there remains a great deal to do I am pleased with progress in both overall operational effectiveness and in the delivery of our key strategic objectives,” said CEO, Stephen Murdoch. 

He added that, “Cash generation and working capital management remain strong, the investments we've made are showing encouraging early results and we continue to see a clear, ongoing customer need for our solutions and approach to digital transformation.” 

MCRO price chart

Disclaimer & Declaration of Interest

The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.

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