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Three Shares That Beat the Market Today

The market’s washed in a sea of red today as the Straits Times Index (SGX: ^STI) slipped by 0.9% to 3,221 points. There were only  two shares that ended the trading session in the green. Despite the broad market sell-off, there were still shares that made some handsome gains.

LionGold Corp’s (SGX: A78) up by 14.2% to S$1.41. The gold miner has had an eventful week so far. On Tuesday evening, it released its first quarter results that saw it post a S$2.6m quarterly profit, an improvement over the S$5.1m loss it made in the previous year. Then, it requested for a trading halt on yesterday morning before the market opened and proceeded to announce some important news before requesting for a lift of the halt in the evening.

The company had proposed to issue, in a private placement to three investors, 180m new shares at S$1.10907 each in addition to 135m detachable warrants at S$0.02 each. The total gross proceeds of the placement would amount to S$202m if it were fully taken up. LionGold intends to use the majority of the proceeds for acquisition opportunities.

The warrants would allow its holders to subscribe for LionGold’s shares at S$1.3555 per share, in the ratio of one warrant to one share, three years after the date of issue. Assuming a full subscription for these shares in the future, the company’s looking at additional proceeds of around S$180m.

LionGold’s chief executive, Nicholas Ng commented on the private placement, “The S$202m we have proposed raising will provide LionGold with a war chest to take advantage of the immediate, extraordinary opportunities we have identified amongst gold global miners. The investments we make today could ultimately position the Group as a leader in the industry, once the up-cycle in gold resumes.”

Despite the possible dilution of more than 30% of existing shareholders’ stake in the company (assuming full take-up for the private placement of shares and warrants, and a full conversion of the warrants into shares), the market seems to have cheered on the company, judging by the share price jump.

Jaya Holdings (SGX: J10) jumped 10.5% to S$0.63 after releasing its full-year results this morning. The offshore energy services group had posted a 145% year-on-year increase in annual revenue to US$202m while profits inched up 5% to US$46m.

Management cited “increased vessel sales and improved charter utilization for the top-line growth. Unfortunately, a sharp decrease in the company’s gross margins from 31.1% to 20.9% meant that earnings could only increase at a fraction of the pace at which revenue grew. The company did not disclose reasons for its gross margin decline.

Multinational conglomerate Jardine Matheson Holdings (SGX: J36), one of the lucky two within the STI to post gains today, rounds up the trio with a 2.2% increase to US$56.50. The company had released its earnings results for the first half of the year two weeks ago. JMH posted a 4% increase in half-yearly revenue to US$31.4b compared to a year ago while underlying profit increased by 7% to US$753m.

The company also declared an interim dividend of 37 US cents, up 6% from the corresponding period a year ago.

The company had seen some mixed results from its many businesses as they face “challenging conditions in many of their markets.” However, management remains satisfied at what they’re seeing and expect a full-year performance that’s largely unchanged from the previous year.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chong Ser Jing doesn’t own shares in any companies mentioned.