Tuesday's most followed: Home Retail, Imagination Tech, Polo Resources, Serica Energy, 3Legs, Borders & Southern, Rolls-RoyceReported by Proactive Investors on Tuesday, 19 June 2012 (on June 19, 2012)
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*Home Retail Group (LON:HOME ) *was at the centre of attention today after seeing its value surge by a quarter after its interim management statement revealed that its Argos store chain performed better than expected in the past quarter.
While like for like sales, which exclude the impact of new store openings, dropped 8.3 percent at the do-it-yourself chain Homebase in the 13 weeks to June 2, like for likes at Argos fell only 0.2 percent and reported sales rose 0.2 percent.
Total group sales at Home Retail dipped 8.1 percent.
“Over a particularly volatile trading period, Argos had a solid start to the year supported by its multi-channel performance,” chief executive of Home Retail Terry Duddy.
“At this early stage of the financial year we are comfortable with current market expectations for full year benchmark profit.”
Home Retail, which surged 25 percent to 92.9 pence this morning, emerged among the most searched for UK stocks on Google Finance along with one of today’s heaviest fallers *Imagination Technologies (LON:IMG)*.
The sharp decline in the share price came despite a strong set of full year results released by the chip designer today.
The report showed that pre-tax profits for the year to end April soared 53 percent to £36.8 million as revenues jumped 30 percent to £127.5 million.
The results got a boost from the launch of new devices that use both the iOS and Andreoid operating systems, which results in an increase in partner chip shipments to 200 million in the second half from 138 million in the first six months of the year.
However, shares in IMG slipped seven percent to 452 pence in early deals.
Broker Canaccord Genuity said the operating profits £39.6 million were ahead of its forecasts of £37.2 million but repeated its ‘hold’ recommendation on the stock with a price target of 520 pence per share.
“IMG’s outlook statement does not show any signs of weakness but we await further details on shipment and average royalty guidance at the analyst presentation this morning to confirm our positive view on IMG’s resilient growth potential,” said Canaccord analyst Bob Liao.
“Strong guidance could lead us to recommend taking advantage of the recent price weakness.”
Other talked about companied in London included gold explorer *Polo Resources (LON:POL)*.
The stock jumped nine percent to 2.6 pence in early deals after Polo raised the indicated resource estimate for its 90 percent owned Nimini - Komahun gold project in Sierra Leone by 374 percent to 521,000 ounces at a grade of 4.59 grammes per tonne (g/t).
The inferred resource currently stands at 263,000 ounces of gold grading 3.64 g/t.
The company is currently advancing a 20,000 metre drill programme at Komahun with a pre-feasibility study due to be completed in the first quarter of next year. The pace of drilling will soon be accelerated with the addition of a third drill rig to the area.
In the meantime, Polo is planning further exploration for the Nimini area, a large part of which it said remained unexplored.
“We are pleased that work since September 2008 has resulted in a 374 per cent increase in gold ounces contained in the indicated resource category,” said executive co-chairman of Polo Neil Herbert.
“Komahun is one of Polo's leading projects, demonstrating gold mineralisation with excellent potential for early mine development.”
Oil and gas stocks *Serica Energy (LON:SQZ)* and *3Legs Resources (LON:3LEG)* also generated interest today.
Serica told investors that the ongoing 3D seismic acquisition programme in the Central Luderitz basin offshore Namibia has made rapid progress, while 3Legs, which is focused Poland, updated investors on its operations in the Baltic basin.
Serica’s seismic programme started on May 10 and passed the 1,500 sq km mark on June 17, which means the company and its partner *BP (LON:BP.)* have met the licence obligations for seismic acquisition in full.
Data acquisition continues with the survey expected to last through the summer.
The data acquired to date is expected to fully delineate a number of significant prospects which have already been identified on the licence.
Back in March, BP agreed to fund the seismic survey in exchange for a 30 percent stake in the project.
In addition to paying the full cost of the survey BP has an option to acquire a further 37.5 percent of the licence by drilling and testing a well.
“Although we have met with some weather delays we are very pleased with the progress of seismic operations to-date,” said chairman and interim CEO of Serica Tony Craven Walker.
“Offshore Namibia remains one of the few under-explored regions worldwide with very large resource potential.
“We look forward to completing the survey and moving to the drilling phase.”
In today’s operational report, 3Legs said it will be shortly conducting further testing on its two existing Baltic Basin horizontal wells Lebien LE-2H and Warblino LE-1H.
Lifting operations on Warblino LE-1H are due to begin this month and testing of Lebien LE-2H well will kick off following the completion of operations at Warblino LE-1H.
This testing programme, said 3Legs, will enable it to obtain additional data on the performance of these two wells and improve its understanding of the play.
In other news, the company has signed a contract with MND Drilling & Services to drill a vertical well on the Lebork concession, Strzeszewo LE-1, which is expected to spud by October this year.
Subject to the conclusions from the further tests and the vertical well, 3Legs and ConocoPhillips will consider a further drilling campaign in 2013.
Sector peer *Borders & Southern (LON:BOR)* will among the stocks to watch over the next few weeks as it is expected to update the markets on the drilling of a wildcat exploration well, which is targeting the Stebbing prospect in the Falklands.
The company said at the time of spudding in May that it expected it to take 49 days to drill, which means drilling should be finished in a little over a week.
The results are anticipated in the third quarter of 2012 and will be announced as soon as the work has been completed.
Back in April, the company announced that its Darwin well discovered gas condensate, otherwise known as ‘wet’ gas, which something of a disappointment as investors were hoping for an oil discovery.
In the meantime,* Rolls-Royce (LON:RR.)* remained among the most followed companies in London.
After securing a £1 billion contract from the Ministry of Defence to supply reactor cores for the UK’s nuclear armed submarines on Monday, the gorup said today that it has delivered thrusters to power the largest ever construction vessel - in an £18 million deal.
The vessel is currently being built at Daewoo Shipbuilding & Marine Engineering, South Korea for Swiss ship owner and operator Allseas Group.
This was the largest ever Rolls-Royce thruster order for a single vessel.
Links:  Full news story
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