Samsung forecasts record profits but misses expectations

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Today’s edition features:

  • Amryt Pharma (AMYT.L)
  • Obtala (OBT.L)

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Markets

Europe
The FTSE-100 finished yesterday’s session 0.36% lower at 7,696.51, whilst the FTSE AIM All-Share index was down 0.28% at 1,064.47. In continental Europe, the CAC-40 finished 0.30% higher at 5,487.42 whilst the DAX was up 0.36% at 13,367.78.

Wall Street
Last night in New York, the Dow Jones waned 12.87 points to close at 25,283.
The S&P-500 added 4.56 points (0.17%) to end at 2,747.71 and the Nasdaq gained 20.83 points (0.23%) to end the session on 7,157.39.

Asia
In Asian markets this morning, the Hang Seng was 100.87 points (0.32%) higher at 30,997.306 and the Nikkei 225 was 135.46 points (0.57%) up at 23,849.99.

Oil
In early trade today, WTI  was up 0.68% at $62.15 per barrel and Brent was 0.55% higher at $68.15 per barrel.


Headlines

Samsung forecasts record profits but misses expectations
Samsung Electronics expects to deliver record profits for the last three months of 2017, but the estimate missed analyst expectations. The world’s biggest memory chip maker forecast operating earnings of 15.1 trillion won ($14.1bn; £10.4bn) – up 64% from a year earlier. But while chip prices boosted margins, a stronger won weighed on the figures. The record guidance comes despite a corruption scandal engulfing top leadership at the South Korean firm. The operating profit forecast is slightly below the 15.9 trillion won estimated by analysts surveyed by Reuters.

Source: BBC News


Company news

Amryt Pharma (AMYT.L, 20.00p) – Speculative Buy
Amryt Pharma yesterday announced that it has signed an exclusive distributor agreement for Lojuxta in Switzerland with RCC Pharma AG (‘RCC’). RCC is a leading Swiss pharmaceutical company focused on early access programs in rare and orphan diseases. Lojuxta is approved for the treatment of Homozygous Familial Hypercholesterolaemia (‘HoFH’), of which, Amryt acquired exclusive marketing rights in the European Economic Area, Switzerland, Middle East, North Africa, Turkey and Israel. The company estimates that there are approximately 15 patients with HoFH in Switzerland.

Our view: This is a positive announcement for Amryt as it extends distribution of Lojuxta into Switzerland. It follows exclusive distributor agreement for Lojuxta (and AP101) in the Kingdom of Saudi Arabia with Faisal Musaed El Seif Saudi Pharmaceutical Company last November, demonstrating global interest for Amryt’s products. The Group’s interim results of 4 September 2017 detailed HoFH generating annualised revenue of €11.5m, with a projected potential market size of approximately €100m. Beaufort reiterates its Speculative Buy rating on the shares.

Beaufort Securities provides corporate sponsored research to Amryt Pharma Plc

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Obtala (OBT.L, 14.25p) – Speculative Buy
Obtala yesterday provided its business update for Q4 FY17. The group announced record annual revenue led by strong Q4 FY17 with contribution from all divisions. Forestry production harvested 11,000m3 of logs and produced 3,500m3 of export grade timber. Sawmill construction in Mozambique is on track for operational in time for cutting season and veneer factory in Gabon remain scheduled to commence production in Q1 FY18. Timber trading division secured US$1m loan capital from senior management and the company said it is on track to for first draw down of external trade finance in Q1 FY18. Agriculture division successfully distributed produces by sea, air, and truck with first 3.8t aircraft container of mangoes sent to Dubai via airfreight.

Our view: Confident business update from Obtala. Looking ahead, forestry production division will focus on growing harvesting capacity in time for the dry season to improve sawmill and new veneer factory (operational in Q1 FY18) utilisation. The group will also work to increase volumes for agriculture produce, while it continue to explore new global market demand. Given both forestry and agriculture division operated well, the focus is now on securing of external trade finance for timber trading activities. Such potential capital will provide opportunity to grow its trading revenues and market share, in an environment where global demand for timber is projected to rise. We retain our Speculative Buy rating on Obtala.

Beaufort Securities acts as a corporate broker to Obtala Limited

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Compiled by:
Charles Long, Ben Maitland, Sheldon Modeland & Kazunaga Senga
(t) +44 (0) 207 382 8384
(e) info@beaufortsecurities.com


Weekly diary


Click here to see all this week’s planned corporate and economic announcements.


Recommendations
During the three months to end-December 2017, the number of stocks on which Beaufort Securities published recommendations was 193, and the recommendations were as follows: Buy – 22; Speculative Buy – 163; Hold – 6; Sell – 2.

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