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MOVERS OF FRIDAY 30 OCTOBER 2020

16:30, 30th October 2020
Francesca Morgan
Market Report
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Cineworld Group (LON:CINE FOLLOW) shares rise 8.67% to 28.15p as it looks towards restructuring  

Shares in Cineworld continue to see some light relief today during afternoon trading.    

In recent weeks, shares in Cineworld Group have been trading over 87% lower than the start of 2020, meaning that the stock is sitting at its lowest level since markets crashed in March.    

The cinema group now has net debt of almost $8.2 billion as recorded at the end of June.    

In recent weeks, Cineworld has brought in a team of consultants from AlixPartners and PJT Partners to help it navigate its way through the most challenging period in its 25-year history.  

Lenders however have tightened their belts to Cineworld amid doubts about the cinema’s survival prospects after it was forced to close down its venues, Consultancy.uk reported. 

Last week, one of the largest syndicates of Cineworld's lenders appointed consultants from FTI Consulting and Houlihan Lokey in order to negotiate with the company over its debt. 

IG Bank said a possible future takeover would rely on the buyer having belief in the long-term future of the cinema industry, ‘which is now in question as streaming sites gain traction.’    

Recently, analysts at Bank of America have warned that Cineworld could run out of cash within weeks, forecasting that it could burn through £324m cash in the next six months.     

According to the Evening Standard, the firm is also facing a High Court demand from AEW UK for £0.308m in unpaid rent between March and June this year during national lockdown.    

While doors remain unlocked, the Cinema group has also continued certain developments, with its long-awaited IMAX extension continuing to progress in Ashford, KentOnline reported.   

The online news site highlighted that work is continuing despite the closure of cinemasand that once major releases are due back on screen, the firm will bring its sites back into use.   

However, for now, the cinema group remains closed until further notice in the UK and US.   

CINE price chart

Amur Minerals Corporation (AIM:AMC FOLLOW) shares jumped 14.75% to 2.075p  

The nickel-copper sulphide mineral exploration and resource development firm said Nathan River Resources, of which it holds a significant convertible loan note, has now kick-started loading its first vessel with low grade iron ore stockpiles from the Roper Bar project. 

Amur said the cargo will be approximately 58,000 tonnes and has been pre-sold by the Offtaker giving NRR an expected revenue from the sale of approximately US$3.6 million. 

With the recent cash injection of additional equity capital announced on 27 October 2020, NRR said it is now targeting four to five further vessels by the end of this year. 

The processing of previously mined blocks has also started and the transportation of existing stockpiles and processed blocks to port is operating 24 hours a day. The Roper Bar site is fully equipped and expected to commence the mining of new blocks in due course. 

Prior to the recent capital raise, NRR had also carried out an independent valuation focusing on the building, infrastructure, plant and equipment assets. This independent valuation increased the equity value of these assets to A$76m. 

A  complete revaluation of assets will be carried out in 2021. Under the terms of the loan, Amur is entitled to a seat on the boards of Nathan River Resources and NRR Group Pte Ltd. 

AMC price chart

Destiny Pharma (AIM:DEST FOLLOW) shares rose 11.80% to 99.5p as it prepares clinical study 

The biotechnology group recently recruited 101 patients out of the target of 125 for the group’s XF-73 Phase 2b clinical study for the prevention of post-surgical infections.  

It is recruiting patients undergoing open heart surgery in the US and Europe to take part in the study of its asset, XF-73. Due to recruitment being slowed by COVID-19, Destiny expects to complete recruitment for the study before the end of 2020 and report results in Q1 2021.  

The trial is a multi-centre, randomised, blinded, placebo-controlled study of multiple applications of a single concentration of XF-73 nasal gel, an experimental drug candidate.  

The Phase 2b trial’s purpose is to assess the microbiological effect of XF-73 on commensal Staphylococcus aureus nasal carriage in 125 patients scheduled for open heart surgery.  

Staphylococcus aureus is both a human skin and mucosae commensal, but also a frequent cause of serious infections with high morbidity, mortality, and healthcare-associated costs.  

The trial study design is related to the successful 2016 clinical trial, funded by the National Institute of Allergy and Infectious Disease, which demonstrated the clinical efficacy of XF-73 versus placebo in reducing nasal Staphylococcus aureus carriage in healthy volunteers.  

Destiny previously announced that it had enabled a reduction in the study size from 200 patients to 125 ‘while maintaining the statistical power of the study and its clinical value’ .  

In a previous statement, the Company was keen to stress that ‘the reduced size of the study does not compromise its integrity, statistical relevance or clinical objectives.’  

Due to its strong financial position, Destiny Pharma told investors that it is well funded through to Q4 2021 to complete its Phase 2 clinical development of its lead drug, XF-73.   

Destiny noted the increased international support to develop anti-infective drugs to address the issue of antimicrobial resistance and said it is ‘well-positioned’ to meet this global need.  

DEST price chart

Chariot Oil & Gas (AIM:CHAR FOLLOW) shares were up 10.44% 6.19p with interest at Anchois 

The Atlantic focused energy company received an expression of Interest Letter this week to finance the Anchois Gas Development Project in the Lixus Offshore Licence, Morocco. 

The Africa Finance Corporation, a pan-African financial institution, confirmed that it would be interested in financing the development of the Anchois discovery and future discoveries. 

Chariot has also received a non-binding expression of interest for further lending for the development of the Anchois discovery from an unnamed multinational investment bank. 

Both expressions of interest take into account the estimated capital expenditure required to bring the development online, which is expected to be in the region of US$300-500 million. 

They also identify Lixus as being an important strategic asset, with strong ESG credentials, that have the potential to help Morocco transition to a low carbon economy, as it seeks to satisfy an anticipated doubling in domestic demand for energy over the next 20 years. 

“Both Expression of Interest Letters further endorse our view that the Anchois development is a high value project, with the potential to deliver near term cash flows to Chariot and also transform Morocco's power sector,” said Adonis Pouroulis, Acting CEO of Chariot. 

CHAR price chart

Petropavlovsk (LON:POG FOLLOW) shares fell 3.46% lower to 26.45p following investigation 

Shares in the Russian gold producer have shed over 30% in value since last month, with the group hitting “a fresh bump” in recent weeks following a turbulent six months, City A.M. reported last week, after Russian authorities launched an investigation into its new CEO. 

The company saw the removal of seven directors, including chief executive and co-founder Pavel Maslovskiy. More recently, Petropavlovsk said last week that Russian police were investigating Meshcheryakov over an incident of forced entry into the company's Moscow office, which some employees and ex-employees were preventing him from accessing. 

In its half-year results for the period ending 30 June 2020 POG said profit had soared in the first half on an increase in gold production, as well as a higher average realised gold price. 

Pre-tax profit soared to $16.5 million in the six months to June 30 from $7.2 million in 2019 while revenue at $522.7 million was up 71% from $305.3 million the year before. 

James W Cameron Jr, Petropavlovsk Chairman said group EBITDA almost doubled from the first half of 2019 to US$193m as a result of higher gold prices and increased production. 

Petropavlovsk said it will now focus on "delivering greater value for all shareholders" by reducing costs, improving controls and raising standards of governance across the company. 

Petropavlovsk has not declared a dividend for eight years. 

POG price chart

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