From UK-Analyst.com: Tuesday 20th November 2012
The Markets Ratings agency Moody's has cut France's credit rating by one notch, from Aaa to Aa1, with a negative outlook, pointing to structural economic challenges and a sustained loss of competitiveness in Europe's second-largest economy. Dietmar Hournung, Moody's lead analyst for France's sovereign rating said "France remains vulnerable to external shocks from the Eurozone crisis, particularly given the strong links between its economy and financial sector and those in troubled southern European countries". Staying in Europe, Eurozone finance ministers are meeting to decide whether to release the next 27 billion pounds worth of bailout funding needed by Greece to stay afloat. At present, Germany and the European Central Bank refuse to write off Greece's debt, while the International Monetary Fund insists Greece's debt must be alleviated. In the UK, the government has set out its intentions to force energy firms to offer the lowest suitable tariff. Under the plans, energy companies will have to reduce the number of tariffs to four each for both gas and electricity plans as the current array of choices has been branded too confusing. The companies would be forced to switch customers automatically to the lowest suitable tariff unless they objected. At the London close the Dow Jones was down by 12.48 points at 12,783.48 and the Nasdaq fell by 2.25 points to 2,593.58. In London the FTSE 100 increased by 10.44 points to 5,748.10; the FTSE 250 finished 76.04 points up at 11,820.83; the FTSE All-Share gained 6.70 points to 3004.02; and the FTSE AIM Index slipped down 1.56 points to 684.58.  Broker Notes Canaccord Genuity maintained its "buy" recommendation on mortgage lender Paragon (PAG) with an unchanged target price of 313p. The broker is impressed with the fact that the company has exceeded its pre-tax profits, earnings per share and NAV per share forecasts and believes the company's prospects are bright. The broker also notes that the firm increased its dividend by 50% over the year to 6p and believes this is indicative of the board's confidence in the business. The shares slipped down by 9.3p to 240.7p. Seymour Pierce initiated coverage of Beowulf Mining (BEM) with a "buy" stance and a target price of 18p. This view is taken by the broker as the mining company is currently evaluating iron-ore and copper-gold projects in Sweden, one of the most supportive jurisdictions in the world for mining, with potential to be expand even further. The broker also cites the fact the company has 4 million in cash available as further justification for its stance. The shares inched up by 0.375p to 10p. Daniel Stewart has reiterated its "sell" stance on Lloyds Banking Group (LLOY) with a target price of 44p. The broker believes that although Lloyds has begun to address its key issues under the leadership of Antonio Horta-Orasio, recovery of the dividend remains some way off. The broker also predicts a likely loss of mortgage market share and increased pressure on the net interest margin, while believing that cost cuts are likely to lag falls in revenue. The shares were up by 0.14p at 45.28p. 
Blue-Chips Commercial property manager British Land (BLND) announced a 1.2% increase in like-for-like net rental income for the six months ended 30th September. The second largest property investment trust in the UK also announced a 3.8% increase in pre-tax profits to 137 million for the period, boosted by the high level of occupancy throughout its portfolio. In part, the firm attributed growth to relatively low cost financing it had in place, with 400 million raised with a coupon of just 1.5%. The shares remained flat at 515p. 
Smiths (SMIN), the technology group, grew revenues in all of its divisions in the three month period ended 3rd November. Operating profits were also ahead of the same period last year in all divisions, with the exception of the Medical division after investment in sales was made. The figures were boosted by a good performance from the Detection division, as cost savings and growth in the order book continued. The shares increased by 11p to 1,050p. Xstrata (XTA) shares jumped by 29.8p to 986.6p after the miner revealed that shareholders have given the go-ahead on a merger between the firm and Glencore (GLEN) , after 10 months of discussions. Shareholders backed the move conditional on the fact that a proposed 227 million pounds pay deal for its top managers was not included. As a result of the merger the enlarged firm will have operations in 33 countries, as it attempts to compete against larger rivals BHP Billiton and Rio Tinto. Mid Caps Homeserve (HSV), the home insurance provider, posted an 8% increase in revenues to 229.6 million pounds and a 9% rise in pre-tax profits to 27.1 million pounds for the 6 month period ended 30th September. The results were driven by strong growth in the international business, with robust performances in both Spain and the U.S particularly. These international gains came as the firm lost 17% of its UK customers as it attempts to reposition the business into a "smaller, more customer-focused operation". The shares soared by 24.9p to 247.9p, although broker Panmure Gordon has a "sell" stance on the stock, noting the ongoing investigation by the Financial Services Authority into the mis-selling of policies. Low cost airline Easyjet (EZJ) reported an 11.6% increase in revenues to 3.854 billion pounds and a 27.9% hike in pre-tax profits to 317 million pounds for the year to September. The results were boosted by a 7.1% rise in passenger numbers and a 1.4 percentage point increase in load factor to 88.7%. The notably strong performance by Easyjet comes at a difficult point in the airline industry cycle, where high fuel costs, weak consumer confidence and the Eurozone crisis are causing some businesses to struggle. The shares flew upwards by 39.5p to 692p. 
Self storage firm Big Yellow Group (BYG) announced a jump in pre-tax profits from 6.4 million pounds to 27.2 million pounds for the six months ended 30th September. The company attributed the growth to a rise in customers using self storage for the first time but warned that the imposition of VAT on storage will create a drag on the pace of earnings. The shares tumbled by 7.4p to 323.6p. Small Caps & AIM Speech recognition provider Eckoh (ECK) announced an 8% increase in pre-tax profits to 0.4 million pounds on a 2% increase in revenues to 5.1 million pounds for the 6 months ended 30th September. The firm attributed excellent traction in its payments products as a reason for its success. Eckoh also revealed that it has agreed a three year contract to provide hosted payment services to an undisclosed large UK based financial services company for an undisclosed fee. The shares dropped by 0.5p to 14.625p. Debt management firm Cleardebt Group (CLEA) reported an 18% increase in revenues to 9.2 million pounds and an 18% increase in gross profit to 4.68 million pounds for the year ended 30th June. Despite the promising results Cleardebt has seen a reduction in individual voluntary arrangements (IVA's) as well as the average income from new IVA's. However, this decrease was offset by an increase in total clients. The shares fell by 0.55p to 1.15p. Hygiene product developer Byotrol (BYOT) posted an 11% increase in group revenues to 1.03 million pounds for the six months ended 30th September driven by improvements in the UK food and beverage division. These improvements, coupled with a 33% reduction in fixed costs, left the company with a loss of 622,000 over the period, down from a 1.3 million pounds lost last year . The shares lost 0.125p to 7.88p. 
Accumuli (ACM), the I.T security specialist, revealed a 22% increase in revenues to 6.7 million pounds and a 12% increase in gross profits to 3.8 million pounds for the 6 months ended 30th September. The firm cites its acquisition policy as a means of consolidating its position in the market and its investment strategy in its solutions as reason for the company's growth. The shares were up by 0.125p at 10.5p. Fox Marble (FOX) has opened its first quarry in Kosovo and has all the equipment required to operate the marble production site in situ at present. The company also reported that it has received "a number of enquiries" from around the world regarding its marble. The project, which is a month ahead of schedule, is expected to yield the first blocks of raw marble in the coming weeks. The shares remained flat at 17.5p. Vectura (VEC), the inhaled therapies specialist, reported a 19.5% fall in revenues to 17 million pounds and a 6.5% fall in after tax profits to 0.9 million pounds driven by the timing of milestone receipts. Despite the downbeat results the company remains positive and believes it has built a platform for a new stage of growth. Also of note is the fact that Vectura stands to collect 32 million dollars on one deal in the near future. The shares lost 1.5p to 78.5p.
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