SMALL CAP MOVERS: Investors tuck into bars and restaurants stocks as lockdown restrictions ease
It was a case of Viva La Revolución as Revolution Bars welcomed the government’s latest lockdown guidelines.
The company, whose brands include Revolución de Cuba, said trading at its bars has been extremely strong since the government allowed bars in England that have outdoor drinking spaces to reopen for business.
The prime minister, Boris Johnson, confirmed on 10 May that restrictions would be eased further on 17 May to allow indoor dining and drinking in England and that the country remains on track for a return to restriction free trading on 21 June.
Revolution Bar shares rose 20% after the company said trading at its bars has been extremely strong since bars with outdoor seating were allowed to reopen on 12 April
The shares rose 20 per cent after the company said it is confident that further pent-up demand exists and that strong trading is anticipated in the months to come as restrictions fall away and it fully opens up its estate.
There was no ‘good on you, Boris!’ statement from Comptoir Group, the Lebanese restaurants group, but that did not stop the shares from rising 32 per cent this week, returning the shares to levels last seen in September 2019.
Although demand for hospitality shares was high this week, oil firm Petro Matad was the top riser after it received approval of the plan of development for its Heron Field project in Mongolia.
Mongolia’s Mineral Resources Professional Council has, subject to some technical clarifications being made, given the green light to the development plan.
With the recent relaxation of lockdown restrictions in Mongolia, Petro Matad is now in discussion with MRPC’s designated officials to clarify the points raised to secure MRPC written approval of the plan of development.
Shares in Petro Matad were up 68 per cent on the week at 8.55p.
In a similar vein, Corcel, the battery metals specialist, jumped 32 per cent after it said its joint venture partner has received the approval of the Environmental Permit Ep-L2 (708) authorising the excavation of laterite ore deposit and direct shipping ore operations at the company’s Mambare Nickel-Cobalt project in Eastern Papua New Guinea.
The approval is conditional, as is normal in Papua New Guinea, on the activity complying with the Environmental Act 2000. The granting of the approval brings to an end a wait of more than two years for Corcel.
Elsewhere in the resources sector, Oriole Resources jumped 46 per cent after it said its joint venture partner IAMGOLD Corp has started its Year 4 exploration programme at the Senala gold project in Senegal.
The programme will comprise around 11,000 metres of reverse circulation and diamond drilling at the Faré and Madina Bafé prospects.
Another gold miner, Lexington Gold, rose by a third on the back of full-year results.
What was so thrilling about the results was not immediately apparent, with the company reporting a wider loss before tax of $712,000 for 2020 compared to a loss of $482,000 the year before.
The net cash position was much improved, however, at $2.9million compared to $100,000 at the end of 2019.
On the subject of share price mysteries, sector peer URU Metals and its board joined the rest of us in professing ignorance of the reasons for the company’s 36 per cent share price increase this week.
The board said it is not aware of any specific reason for this increase.
It seems barely a week has gone by this year without Hurricane Energy featuring in this column, usually on the debit side of things and this week is no different, with the shares down 18 per cent after the company lifted the lid on its highly-dilutive debt deal.
A deal struck with a 69 per cent majority of the group’s convertible bond holders will see some $50million of the total $230million debt swapped for new shares in the company.
These refinancing shares will equate to 95 per cent of the group’s fully diluted pro forma equity immediately following the restructuring.
The bondholders – and subsequently the majority owners of the company – agreed to amend the terms for the remaining $180million of outstanding bonds to extend the maturity date out to December 2024.
Hurricane shares now trade at 0.69p; four years ago they would have set you back about 50p. Long-suffering Hurricane shareholders must be hoping the restructuring deal puts a line under things and the company can get back to exploiting its Lancaster field.