FTSE 250 movers: Ferrexpo rallies; Direct Line slides
By Frank Prenesti
Date: Monday 25 Mar 2024
(Sharecast News) - FTSE 250 (MCX) 19,610.45 -0.58%
Ferrexpo updated the market on the proceedings involving its subsidiary Ferrexpo Poltava Mining (FPM) on Monday.
The FTSE 250 company said that despite ongoing legal matters, operations at FPM remained robust, with production and sales unaffected.
It said February saw the highest production volumes since the onset of the full-scale invasion of Ukraine in two years earlier.
Regarding the anticipated preparatory hearing at the Commercial Court in Poltava Oblast, scheduled for 12 March to address an application from Kysen, Ferrexpo said the hearing was postponed.
The rescheduled hearing was now set for 9 April, with Kysen claiming a debt increase to UAH 4.5m ($0.12m) under supply agreements.
While FPM continued to contest a separate sureties claim, the company said it had adequate financial resources to sustain operations and settle the debt claimed by Kysen.
Despite restrictions on FPM's bank accounts in Ukraine, the company said it could manage essential payments such as salaries, taxes, and energy suppliers.
However, payment to other suppliers was restricted.
FPM had entered separate arrangements with most key creditors and suppliers to meet payment obligations, ensuring continuity in business operations.
Additionally, two court hearings scheduled for 20 March did not proceed as planned.
A hearing regarding a claim against FPM was postponed due to the presiding judge's recusal, with a new court date pending.
Another hearing related to the FPM general director's bail in a royalties case was postponed due to technical issues with recording equipment, rescheduled for 2 April.
Direct Line said on Monday that it was confident in its standalone prospects after Belgium's Ageas announced it would not be making an offer for the insurer following two failed attempts at engaging with the board.
"As communicated at Direct Line Group's 2023 preliminary results on 21 March 2024, the board believes under Adam Winslow's leadership the company is well-positioned to drive material improvement in performance that is expected to unlock significant value for Direct Line Group shareholders," the London-listed insurer said.
In a statement late on Friday, Ageas expressed regret that it was not able to "work collaboratively" with the Direct Line board towards a recommended firm offer.
"Ageas was not able to identify additional elements based on publicly available information that would justify significant adjustments to the terms of its possible offer. Therefore, consistent with its financial discipline, Ageas has decided not to make a firm offer," it said.
"Ageas continues to believe in the underlying attractiveness and future opportunities of the UK personal lines sector and the role of Ageas UK in this market, underpinned by its successful turnaround over the last few years.
"Ageas UK will continue to execute its focused personal lines insurance strategy alongside its valued distribution partners."
On 28 February, Direct Line announced that it had rejected a £3.1bn offer from Ageas. This comprised 100p in cash and one new Ageas share for every 25.24 Direct Line shares, and implied a value of 233p per share.
On 13 March, the insurer said it had received and rejected a second takeover approach from its Belgian rival as it continued to undervalue the group. That approach, received on 9 March, was 120p a share in cash and one new Ageas share for every 28.41 Direct Line shares. It had an implied value of 237p a share.
"The board considered the latest proposal with its advisers and continues to believe the latest proposal is uncertain, unattractive, and that it significantly undervalues Direct Line Group and its future prospects while also being highly opportunistic in nature," it said at the time.
Octopus Renewables Infrastructure Trust (ORIT), the clean energy investment fund of Octopus Energy Group, reported a small drop in net asset value in 2023, but still upped its payouts to shareholders after what it deemed a "resilient" performance.
The company, which holds renewable energy assets in Europe and Australia, said NAV fell to £599m by the end of last year, down from £618m in 2022, driven primarily by falling power price and inflation forecasts, along with increases applied to discount rates. NAV per share slipped to 106.04p from 109.44p.
Total shareholder returns for the year were -4.4%, as share prices across the renewable infrastructure sector continued to fall.
The company's operational portfolio produced 1,110 GWh, 14% below the target of 1,291 GWh, but above the 1,005 GWh generated in 2022. It assets across UK, France, Ireland, Finland, Sweden and Germany generated revenues of £117.4m, up from £112m but 16% below the £139.8m target.
ORIT said this was a result of onshore wind production being 20% below target, mainly due to low wind speeds, combined with a hit from lower-than-expected power prices.
"ORIT has demonstrated resilience in its FY 2023 performance despite a challenging backdrop both for the asset class and the investment trust sector as a whole," said chair Phil Austin.
"The company generated a positive NAV total return and delivered a dividend fully covered by operational cashflows, thanks in the main to the high proportion of fixed revenues which bodes well for future payments."
Total dividends for the year were 10.5% higher than 2022 at 5.79p per share, in line with the company's target.
"Despite the market challenges experienced in the investment trust sector in recent months, the fundamental driving forces behind clean energy investment are stronger than ever, and we believe that ORIT is very well placed to continue its contribution to the transition to net zero whilst ensuring an attractive level of returns for our shareholders," Austin said.
Market Movers
FTSE 250 - Risers
Ferrexpo (FXPO) 44.96p 4.03%
PZ Cussons (PZC) 88.40p 3.51%
PureTech Health (PRTC) 223.00p 3.24%
W.A.G Payment Solutions (WPS) 72.00p 2.86%
Breedon Group (BREE) 379.00p 2.71%
Network International Holdings (NETW) 393.60p 1.97%
QinetiQ Group (QQ.) 370.40p 1.93%
Tritax Eurobox (GBP) (EBOX) 53.00p 1.92%
Ithaca Energy (ITH) 144.60p 1.83%
Centamin (DI) (CEY) 108.30p 1.79%
FTSE 250 - Fallers
Direct Line Insurance Group (DLG) 190.10p -9.04%
Future (FUTR) 617.00p -5.87%
Trustpilot Group (TRST) 182.10p -4.91%
Bridgepoint Group (Reg S) (BPT) 268.20p -3.11%
Close Brothers Group (CBG) 385.20p -2.92%
Octopus Renewables Infrastructure Trust (ORIT) 70.30p -2.90%
Fidelity Emerging Markets Limited Ptg NPV (FEML) 650.00p -2.88%
Games Workshop Group (GAW) 9,975.00p -2.87%
Rotork (ROR) 328.00p -2.61%
Bluefield Solar Income Fund Limited (BSIF) 99.20p -2.55%
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