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ISEQ bounces to near pre-crisis level

Tuesday, March 05 17:39:53

The main Irish index of shares rose to its highest level since September of 2008 today as evidence mounted that we have turned a corner in the economy and an appetite for risk returned.

The ISEQ was up 73.81 points to 3,886.16.

Statements emerging from the Eurogroup meeting of finance ministers indicated that an agreement has been reached to extend the term of Ireland and Portugal's EU bailout funds from the EFSF and EFSM. EU Commissioner Oli Rehn said: "the troika will consider an appropriate and credible extension of the maturities on the early EFSF and EFSM loans, with a view to smoothing the path back to durable market access".

Media reports indicate that an agreement has been reached in principal. Final proposals will be approved by ministers at next month's Eurogroup meeting in Dublin. Minister for Finance Michael Noonan indicated that an extension of 15 years is now being sought. The maturity structure of current EFSF and EFSM drawdowns is on average 12 years.

Currently, E6.3bn of EFSF/EFSM loans are due to mature in 2015 and E4.2bn in 2016. A further E3.9bn of EFSM loans will mature in 2018.

Shares in Paddy Power climbed 274c to E66.84 after it posted profits that rose 15pc in the full year 2012 to E139.2m on a string of good sports results, strong Internet trading and a marked improvement in its Irish operations.

The company clocked in annual revenues that grew by 25pc to E5.7 billion with its chief executive Patrick Kennedy saying the group now has nearly twice as many online users as it has in 2010 as mobile gaming has been adopted across its markets. "Unsurprisingly, the group has reported strong growth in net revenues year-to-date, helped by the favourable gross win margins experienced by the group's peers. On a constant currency basis, net revenues are up 34pc (against Davy expected growth of 22-24pc). This strong growth, however, is likely to be largely offset by a stronger euro versus both the British pound and the Australian dollar. These unfavourable FX movements, should they persist, will create a E10m headwind at EBIT level," said Davy.

Shares in total Produce rose 1c to E0.60 as a string of acquisitions across Europe and North America helped the Irish fresh foods group achieve 11.2pc revenue growth in the full year 2012 to E2.8 billion, the company said this morning. Core profits, as measured by EBITDA, jumped by 17.8pc to E70.4m, it said, adding that adjusted profits before tax were up 19.1pc to E47.3m while earnings per share were up 12pc to 8.11 cent and the final dividend rose 12pc to 15.12 cent while the total 2012 dividend rose 10pc to 2.079 cent.

Trading conditions since the start of 2013 have been satisfactory, according to Carl McCann, Chairman.