By Powerscourt on 29/01/2021

Powerscourt Coronavirus Briefing – 29 January 2021


The focus of COVID-19 watchers in EU member states and the UK is on a press briefing at lunchtime in Brussels today. The European Medicines Agency (EMA) will unveil its much anticipated decision on whether to authorise the Oxford/AstraZeneca vaccine.

There was an added subplot yesterday when the independent panel advising the German government on vaccination recommended that the Oxford/AstraZeneca jab not be used for the over-65 age group because of insufficient data on its efficacy. If the EMA follows the line taken by the Standing Committee on Vaccination at the Robert Koch Institute in Germany, then the EU’s plans for mass inoculation will be thrown into disarray.

The AstraZeneca jab had been earmarked by member states for wider use – starting with older age groups – as soon as it was authorised. However, the EU’s planned mass inoculation starting with the AsztraZeneca jab was already in doubt because of the Anglo-Swedish pharma company’s failure to deliver on its supply commitment. There were some interesting details on the ongoing row between the European Commission and AstraZeneca in the Irish Times. The EU gave the company an upfront payment of €336 million last September to help with the manufacture of the vaccine at its four European plants, including two in the UK. The original contract between the company and the EU was for 125 million doses, but it notified the Commission last December that, because of production glitches, this would be closer to 80 million doses.

AstraZeneca announced in December that the initial supplies of its vaccine to the UK would come from its plants in Holland and Germany. AstraZeneca told a UK Commons Select Committee in January that it was able to significantly ramp up production in the UK to increase supplies to the British government. Last week, it told the EU that it would only be able to deliver 25% of its original commitment and that its contract with the UK government meant than vaccines manufactured in the UK were ringfenced for that country. In view of these details it is little wonder that EU officials appeared “emotional and aggravated” during the week. The latest reports coming out of Brussels suggested that AstraZeneca has moved on its position and might be able to increase its supply to the bloc.

Even though all eyes will be on the EMA press briefing scheduled for 1pm (GMT), there will be an equally important development elsewhere in Brussels today. The EU will empower member states to block the exports of vaccines by forcing pharma companies to seek authorisation before shipping jabs out of the bloc. Brussels has said that the move will not threaten supplies committed through the World Health Organisation’s Covax program for the fair distribution of vaccines to developing countries.

The EU’s rationale for the move is to prevent a repeat of what happened with AstraZeneca. It is being interpreted elsewhere as introducing potentially damaging protectionist policies, particularly in the UK amid claims that it could threaten supplies of the Pfizer jab that are manufactured on the continent.

There was good and bad news from the latest vaccine candidate to fight the pandemic. Novavax said that, following phase III trials, its vaccine was 89% effective and that included against the UK variant of the virus, which is becoming the dominant strain of covid in many countries. However, a much smaller trial showed that it was only 50% effective against the South African variant.

European and U.S. stock futures fell on overnight trading, while Asian equities headed for their steepest weekly loss in months, amid growing concerns over the impact of a populist insurgence by retail investors in the US against hedge funds. 



Industrials & Transport

Polymetal International PLC
One of the top-10 global gold producers and top-5 silver producers has today reported strong production results for the fourth quarter and twelve months ended December 31 2020. Despite the pandemic, it was a relatively strong year for Polymetal, with a 4% increase year-on-year in gold equivalent output, up to 1,559 Koz. Revenue in 2020 jumped by 28% to reach US$ 2.9 billion while Q4 revenue was up 31% y-o-y to US$ 0.8 billion on the back of higher gold sales and higher metal prices. The lag between gold production and sales has been closed. Crucially, the Company also saw zero fatal accidents in the year, compared to two employee fatalities and one contractor fatality in 2019, as lost time injury rate among company employees decreased 37% year-on-year.

Evraz PLC
The vertically integrated steel, mining and vanadium business has today released a trading update for the fourth quarter and full year results 2020.  Despite challenges caused by the pandemic, Evraz consolidated crude steel production remained almost flat year-on-year (-1.3%), even with disruptions to the oil and gas markets. Total sales of finished products were down 10.1%, mainly attributable to the sale of Palini e Bertoli in 2019, as well as lower tubular and flat-rolled products sales at EVRAZ North America, amid unfavourable market conditions caused by the COVID-19 pandemic.

Financials & Real Estate 

Paragon Banking Group PLC
The specialist finance provider has today released a trading update based on the business performance from 1 October 2020 to 31 December 2020. Despite ongoing Covid-related uncertainty, the Group’s trading performance has been in line with board expectations for Q1 of its 2020/21 financial year. In a resilient performance so far, specialist buy-to-let volumes have remained robust during Q1, reaching £298.7m. Furthermore, the buy-to-let pipeline at the end of the quarter stood at £966.8m, £152.8m above Q1 2020. This pipeline is expected to convert at a faster rate over the coming quarter, given the concentration of completions arising from the stamp duty changes which impact from the end of March 2021. Whilst the full economic effect of Covid-19 remains uncertain, the Group’s performance during the first quarter has been encouraging and the Board’s expectations on volumes and net interest margin remain unchanged.



Airtel Africa PLC
The leading operator of affordable mobile service in 14 African countries has today reported another quarter of double-digit growth, with continued improvement in revenue growth and EBITDA profitability. Reported revenue increased by 13.8% to $2,870m with Q3’21 reported revenue growth of 19.5%. Furthermore, underlying EBITDA for the nine months was $1,297m, up 16% in reported currency while constant currency underlying EBITDA growth was 22.5%. In a good period for the Company, operating profit increased by 21.8% to $800m in reported currency, and by 29.9% in constant currency. Customer base up 11.0% to 118.9 million, with increased penetration across mobile data and mobile money services. 2.5m customers were added in Q3.


PM insists Oxford jab does work on over-65s – The Times

Novavax’s Covid-19 vaccine shown to be 89% effective – Financial Times

EU threatens to publish AstraZeneca amid claims UK has legal right to first supplies – The Telegraph