The ongoing exploration campaign in the Falklands was among the dominant themes of the day in the oil and gas sector, while Sirius Minerals (LON:SXX) was atop the list of Google Finance searches as investors digested the details of yesterday’s fundraising.
Sirius, a UK operating potash group, saw its share price drop nearly 10 percent after unveiling plans to raise £50 million in a share placing at a discount to the current market price. The funding will help the group take its flagship York potash project to a definitive feasibility study (DFS).
The fundraising followed the drilling of a second bore hole at York, which indicated the possibility of developing the project with a lower cost shaft, prompting the company to move the timetable forward.
Sirius also said now was the best time to have a fundraising given the persistent economic uncertainty in wider markets.
Today, shares in Sirius rebounded, rising 2.5 percent to 21.75 pence compared to the placing price of 18 pence.
On message boards, investors following Sirius noted that demand for Sirius shares was high as the placing was oversubscribed. Some said that the publication of the definitive feasibility study and an update on the current JORC compliant resource at York could lead to a re-rating of the stock.
Investors were also encouraged by the fact that chairman Russell Scrimshaw said he would subscribe for £3.4 million worth of stock, which was seen as a sign that the management is confident that the project will successfully go into production.
Falkland Oil and Gas (LON:FOGL) also emerged among the most actively discussed companies on bulletin boards. Investors were focused on the upcoming drilling campaign by fellow Falklands operating firm Borders & Southern (LON:BOR), which will target the Darwin prospect.
Darwin is similar to several prospects owned by FOGL including Inflexible and Thulla. Should the first well targeting Darwin be a success, it will significantly de-risk FOGL’s prospects ahead of its drilling programme, which will kick off once the Leiv Eiriksson rig is released by Borders & Southern.
The rig is expected to begin drilling for Borders & Southern in late January.
Meanwhile, the most read RNS announcements of the day included an update from FTSE 250 constituent De La Rue (LON:DLAR).
The banknote printer expects to hit its full year targets as its performance in the second half of the financial year has so far been in line with expectations.
Revenues at the currency divisions have continued to improve as order intake remained “good” and consistent with the first half of the financial year, which ended on September 24. The solutions division has also grown at the same pace as in the first half.
In the meantime, De La Rue said its improvement plan is progressing well and has resulted in further cost reductions and the early results of its revenues growth initiatives are also encouraging.
The trading updates from Creston (LON:CRE) and Hornby (LON:HRN), which also made the list of popular stock exchange statements, were far less positive, triggering steep declines in the companies’ share prices.
Communications group Creston issued a profit warning, saying that despite the strong revenue growth of 22 percent it enjoyed in the fourth quarter, its pre-tax profits will be below last year.
The shortfall in profits is a result of failure to secure new business in the last three months of the year, delays in client projects and operating losses associated with start-up ventures.
“Appropriate actions have begun to align operating costs to the lower expected sales levels, the effects of which will predominantly be realised from the start of the new financial year,” Creston said in the statement.
Creston lost a quarter of its value in early deals, seeing its shares plunge to 50 pence, while toy maker Hornby plummeted 17 percent to 102.75 pence after revealing that sales growth in the crucial Christmas shopping season was below expectations.
The group said consumer confidence remained low amid continuing economic uncertainty in Europe, affecting the sales of its “high-ticket” items such as the Hornby and Scalextric sets.
The outlook offered in the report was cautious with Hornby expecting trading conditions in the UK and Europe to remain challenging for the “foreseeable future”. The group said it will address the tough trading environment by reducing costs and broadening its product portfolio.
It is also hoping for a boost from its London 2012 range for the upcoming Olympic Games.
One of yesterday’s most followed stocks, real estate group Orchid Developments (LON:OCH), again found itself under the spotlight today after revealing that it has received a takeover approach that “may or may not lead to an offer for the company being made”.
Shares in the group jumped over 20 percent yesterday on speculation that it had found a buyer for its Grand Mall in Varna.
“The approach is at a very early stage and there can be no guarantee that it will result in an offer being made,” Orchid said in today’s statement.
Back in September, Orchid reported a €2.1 million profit for the first six months of 2011, while its net asset value stood at €75 million at the end of June.
Meanwhile, jewellery group Abbeycrest (LON:ACR) had its shares suspended from trading on the main market today after failing to find a buyer for its subsidiary Abbeycrest Thailand.
As a result, the group may not have enough working capital to fund its operations, which has prompted it to request the suspension pending “clarification of the Group's financial position”.