MARKET CLOSE: NZ stocks rise; F&P Appliances, retailers lead gains
By Jason Krupp
Dec. 21 (BusinessDesk) - New Zealand stocks rose, led by retailers in the final week of the peak pre-Christmas shopping season. Fisher & Paykel Appliances Holdings paced gainers, while New Zealand Refining Co. fell.
The NZX 50 Index fell rose 19.14 points, or 0.6 %, to 3,319.1. Within the index, 24 stocks gained, 17 declined and nine were unchanged. Turnover was $77.7 million.
Pumpkin Patch, the children's clothing retailer, rose 5% to $1.67 and Kathmandu Holdings, the outdoor clothing chain, rose 2.9% to $1.78. Warehouse Group, New Zealand's biggest listed retailer, rose 2% to $3.65.
"The market is showing its festive side, and what enthusiasm there is out there is buying," said Rickey Ward, domestic equities manager at Tyndall Investment Management.
F&P Appliances, the whiteware manufacturer,
rose 5.9% to 54 cents.
PGG Wrightson Ltd., the rural services company, rose 2.1% to 48 cents, after NZ Farming Systems Uruguay Ltd. said it had secured a $50 million loan from majority shareholder Olam International.
Part of the loan will be used to pay all outstanding balances owed to Wrightson for performance and management fees, and fees related to the buyout of the management contract. Shares in Farming Systems fell 4.9% to 58 cents.
Last week, Wrightson revised its annual earnings forecast downwards to between $15 million and $18 million, compared with $23 million previously, due to a slow recovery in the agricultural sector and the disposal of the NZ Farming Systems management contract.
"When you evaluate the profit downgrade last week it was not structural, and it more seasonal than anything else," Ward said. "When you take that into account people seem to think that it was oversold."
Telecom Corp. rose 0.9% to $2.23 after the Commerce Commission said New Zealand's biggest telephone company would not face regulatory shackles over its premium copper-based broadband service that is set to be unveiled next year.
That means Telecom can set the pricing for its second-generation Very high bit-rate Digital Subscriber Line (VDSL2) services without facing the same rules governing fixed-line broadband.
South Port New Zealand, which operates the nation’s southern-most port at Bluff, rose 7.1% to $2.70 after it said 2011 earnings will exceed its forecast range because of increased volumes of logs exported to China and a return to normal output from the Tiwai Aluminium Smelter.
Full-year profit will exceed the $3.5 million to $3.9 million range given in the company’s 2010 annual report. In the first five months of the year, total cargo volume was 1.09 million tonnes, up from 820,000 tonnes in the same period a year earlier.
NZX Ltd. rose 1.4% to $1.49 after the securities market operator said its NZX Dairy Futures had gained enough support from traders to add skim milk powder and anhydrous milk fat futures to the whole milk powder contract in February.
SmartPay Ltd., the EFTPOS services company that bought distressed Provenco-Cadmus assets, rose 3.9% to 2.7 cents after it raised $2.3 million through a series of discounted private placements, and has secured a $2 million funding line.
Air New Zealand Ltd., the national carrier, was unchanged at$1.49 after Transport Minister Steven Joyce approved its trans-Tasman alliance with Virgin Blue.
The decision follows approval being granted by Australia’s antitrust regulator this month, reversing its preliminary view, after the two airlines gave guarantees on growth in capacity. Joyce was also swayed by their commitment to maintain passenger numbers on the Tasman, according to his statement.
"Most people expected the Air New Zealand announcement to come out after the ACCC amended their previous decision, and I think that's already been priced in," Ward said.
NZ Refining, the operator of New Zealand's only oil refinery, fell 4.5% to $4.25, pacing decliners on the exchange. Rakon Ltd., the manufacturer of crystal oscillators used in cellphones and GPS units, fell 2.5% to $1.17, and Steel & Tube Holdings, the manufacturer of steel products used in the construction industry, fell 1.9% to $2.11.
Abano Healthcare Group fell 0.4% to $4.85 after the specialist health clinic investor reported a drop in first-half profit, reflecting the absence of revenue from the Bay Audiology business sold last year.
Underlying profit fell to $2.8 million in the six months ended Nov. 30, from $3.4 million a year earlier, the company said in a statement today. Sales declined to $86.7 million from $102.3 million.