Plexus Holdings Plc

Plexus Holdings Plc (LON: POS) is an oil equipment, services & distribution company providing services related to oil and gas engineering. The group specialises in designing and supplying wellhead products to the oil and gas industry globally.

Recent News
On 26^th February 2020, Plexus Holdings announced it had received an order of POS-GRIP® jack-up drilling wellhead equipment from its Russian licensee Gusar (LLC Gusar). The equipment was priced at market rates on cash payment.

 Financial Highlights – H1 Financial Year 2020 (31^st December 2019, GBP, thousand)
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 (Source: Interim Report, Company Website)

For the first half of the financial year 2020, the revenue declined significantly to GBP 49 thousand versus GBP 1,312 thousand in H1 FY2019. The reported gross loss stood at GBP 2 thousand in H1 FY2020 versus a gross profit of GBP 484 thousand in the first half of the financial year 2019. The operating loss stood at GBP 3,026 thousand in H1 FY2020 versus an operating loss of GBP 2,349 thousand in the first half of the financial year 2019. The group’s LBT and LAT (loss before tax and loss after tax) stood at GBP 2,763 thousand in the first half of the financial year 2020 versus an LBT and LAT (loss before tax and loss after tax) of GBP 2,337 thousand in the H1 financial year 2018. The company’s basic and diluted loss per share stood at 2.75 pence in the H1 of the financial year 2020 versus a basic and diluted loss per share of 2.22 pence in the H1 financial year 2019.

Share Price Performance

Daily Chart as of April 3^rd, 2020, after the market close (Source: Thomson Reuters)

Plexus Holdings Plc shares were trading at GBX 14.50 at the time of writing after the market close on 3^rd April 2020. Stock's 52 weeks High is GBX 57.80 and Low is GBX 8.50.

Conclusion
The group has shown a decline in financial performance in the first half of the financial year 2020. Both the top-line and the bottom-line performance has declined with negative profitability for the period. The company operates in a challenging environment which requires continuous investment, sometimes at the cost of profitability, to stay ahead of competitors. Some of the risks which can impact business operations are capital constraints, global economic volatility, commodity price risk, legal compliance regulatory or litigation risk, adverse market sentiment, political and country risk. The group’s operations were impacted due to Covid-19 outbreak as it resulted in a disturbance in the supply chain and operational performance. With the outbreak of Covid-19, many countries imposed restrictions on travel and resulted in a sharp fall in the stock markets globally.

Keeping in mind the risks faced by the company, investors are recommended to “AVOID” taking fresh positions at the closing price of GBX 14.50 (as on 3^rd April 2020).

Star Phoenix Group Ltd

Star Phoenix Group Ltd (LON: STA) is an oil & gas producers company engaged in the business of exploration, production and development in Indonesia and Trinidad. The group holds interests in Beach Marcelle, South Quarry, Morne Diablo, Guayaguayare and St Mary's.

Recent News
On 2^nd April 2020, Star Phoenix Group announced the sale of RRTL (Range Resources Trinidad Limited) to LandOcean ( LandOcean Energy Services Co Ltd) had been completed, and all payables and debt have been offset to LandOcean leading to termination of debt agreement between two companies. LandOcean also paid USD 1,508,000 cash consideration to Star Phoenix Group.

On 1^st April 2020, Star Phoenix Group announced the selection of Mr Lubing Liu. Mr Liu will hold the responsibility of Joint Company Secretary and will be replacing Sara Kelly effective from 1^st April 2020.

Financial highlights – H1 Financial Year 2020 (31^st December 2020, USD)

(Source: Interim Report, Company Website)
 
For the first half of the financial year 2020, due to lower revenue from upstream and oilfield services, the revenue declined to USD 31,579 versus USD 619,374 in H1 FY2019. The reported gross loss stood at USD 820,558 in H1 FY2020 versus a gross loss of USD 1,834,601 in the first half of the financial year 2019. The group’s LBT (loss before tax) from continuing operations stood at USD 8,188,066 in the first half of the financial year 2020 versus an LBT (loss before tax) from continuing operations of USD 15,091,347 in the H1 financial year 2018. The LAT (loss after tax) attributable to shareholders stood at USD 5,517,131 in the first half of the financial year 2020 versus a LAT (loss after tax) attributable to shareholders of USD 35,882,084 in the H1 financial year 2018. The company’s basic loss per share from continuing operations stood at 0.06 cents in the H1 of the financial year 2020 versus basic loss per share from continuing operations of 0.01 cents in the H1 financial year 2019.

Share Price Performance

Daily Chart as of April 3^rd, 2020, after the market close (Source: Thomson Reuters)

Star Phoenix Group Ltd shares were trading at GBX 2.25 at the time of writing after the market close on 3^rd April 2020. Stock's 52 weeks High is GBX 8.50 and Low is GBX 0.575.

Conclusion
The group has shown improvement in financial performance in the first half of the financial year 2020. Although the revenue as declined for the period, the bottom-line performance has improved while the profitability remained in the negative zone for the period. The company rely heavily on the renewal of its licenses from regulatory authorities. The company operates in a challenging environment which requires continuous investment, sometimes at the cost of profitability, to stay ahead of competitors. With the outbreak of Covid-19, many countries imposed restrictions on travel and resulted in a sharp fall in the stock markets globally.

Keeping in mind the risks faced by the company, investors are recommended to “AVOID” taking fresh positions at the closing price of GBX 2.25 (as on 3^rd April 2020).

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