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FTSE 250 movers: Ithaca gushes on UK govt decision to allow more fossil fuels

Published 27/09/2023, 16:30
© Reuters.  FTSE 250 movers: Ithaca gushes on UK govt decision to allow more fossil fuels
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Sharecast - The development of the field, 130km north west of Shetland in the North Sea, is opposed by environmentalists.

Last month a cross-party group of MPs and peers wrote to then energy secretary Grant Shapps, urging him to block the move. They claimed Rosebank could produce 200m tonnes of carbon dioxide, with taxpayers shouldering much of the development costs.

But announcing the government’s decision on Wednesday, new energy secretary Claire Coutinho said it "makes sense" to use oil and gas from North Sea fields such as Rosebank.

She continued: "We will continue to back the UK’s oil and gas industry to underpin our energy security, grow our economy and help us deliver the transition to cheaper, cleaner energy."

London-listed Ithaca Energy (LON:ITH) - which owns a 20% working interest in the field - said it and majority operator Equinor, the Oslo-based energy firm, would initially invest $3.8bn in the development.

The project is expected to create around 1,600 jobs during the construction phase, and 450 positions long term.

Recoverable resources are estimated at around 300m barrels of oil from phase 1 and phase 2, with phase 1 targeting 245m barrels of oil.

Ithaca said that in total, the project is expected to lead to around £8.1bn of total direct investment.

Gilad Myerson, executive chair, said: "We are now poised to embark on a journey that will not only provide critically important domestic energy but also ignite substantial economic impact.

"The Rosebank project will create thousands of jobs and contribute significantly to securing the UK’s energy needs for many years to come."

However, Caroline Lucas, co-leader of the Green party, called the decision "the greatest act of environmental vandalism in my lifetime".

She continued: "This is morally obscene. It won’t improve energy security or lower bills, but it will shatter our climate commitments and demolish global leadership."

As at 0930 BST, shares in Ithaca were trading 8% higher at 177p, while Norway-listed Equinor was ahead 1%.

Production is expected to begin in 2026/27.

Cybersecurity group NCC said it expects a "period of considerable change" this year as it executes on its turnaround strategy after macro conditions held back revenue and profit growth in the 12 months to 31 May.

Full-year results, which showed a 6.4% rise in group revenue to £335.1m and a 40.1% slump in adjusted operating profits to £28.8m, were largely in line with expectations after a number of detailed trading updates over recent months. Group operating profit margin was just 0.6% for the year, compared with 11% previously.

In March, NCC announced that market volatility in the North American tech sector – and to a lesser extent in the UK – was impacting results. Tech-sector layoffs resulted in delays or cancellations to contract decisions; the knock-on impact of the Silicon Valley Bank collapse affected demand for tech in the banking sector; while interest-rate hikes in the US and UK were putting cost pressures on clients.

"While the market conditions we announced in our March trading update have impacted our FY23 revenue performance and profitability, we are confident about the medium-term growth drivers for cyber security and that continued progress on strategic actions will position the business to deliver greater growth and profitability in the years ahead," said chief executive Mike Maddison.

"I am pleased to report that since the launch of our Next Chapter strategy in February 2023, the group has delivered foundational components of strategic change to create a more agile and resilient business, improve profitability and deliver shareholder value."

NCC reiterated its medium-term targets for double-digit revenue growth and mid-teens operating profit margins from the year to May 2026 onwards.

A final dividend of 3.15p for the year to May 2023, unchanged from the previous year, "as the board is conscious of the need to invest in new strategy and manage its net debt accordingly following the challenging year", the company said.

The stock was up 1% at 101.4p by 1016 BST on Wednesday, having fallen 50% since the start of 2023.

Market Movers

FTSE 250 (MCX) 18,292.32 -0.24%

FTSE 250 - Risers

Ithaca Energy (ITH) 177.10p 8.52%

Close Brothers Group (CBG) 884.00p 5.68%

NCC Group (NCC) 104.00p 3.59%

Future (FUTR (LON:FUTR)) 736.50p 3.44%

Harbour Energy (LON:HBR) 261.10p 3.32%

TUI (LON:TUIT) AG Reg Shs (DI) (TUI) 451.00p 3.25%

Ceres Power Holdings (LON:CWR) 328.00p 2.95%

Intermediate Capital Group (LON:ICP) 1,376.00p 2.69%

Vesuvius (VSVS) 427.60p 2.44%

Ferrexpo (LON:FXPO) 77.95p 2.36%

FTSE 250 - Fallers

Great Portland Estates (GPE) 415.20p -3.84%

Big Yellow Group (LON:BYG) 942.00p -3.83%

Savills (LON:SVS) 838.00p -3.34%

AJ Bell (AJB) 272.80p -3.33%

Coats Group (LON:COA) 71.70p -2.98%

Safestore Holdings (SAFE) 737.50p -2.90%

British Land Company (BLND) 317.60p -2.82%

Syncona Limited NPV (SYNC) 109.20p -2.67%

Derwent London (DLN) 1,860.00p -2.57%

Hilton Food Group (HFG) 738.00p -2.51%

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