MARKET CLOSE: NZ shares mixed; Port of Tauranga gains, Fletcher falls

Feb. 23 (BusinessDesk) - New Zealand shares were mixed, with as many gaining stocks as decliners on the NZX 50 Index. Port of Tauranga rose after posting record first-half earnings while Fletcher Building extended its decline after profit missed its guidance.

The NZX 50 fell 5.07 points, or 0.2 percent to 3323.15, having flitted between gains and losses during the day. Within the index, 18 stocks fell, 18 rose and 14 were unchanged. Turnover was about $110 million.

Earnings season has delivered a mixed bag of beats and misses. Fletcher had warned that first-half profit would drop at least 10 percent then reported a 13 percent decline.

Its shares fell 0.8 percent to $6.46 today, adding to their 2 percent drop yesterday, when the company said weak demand for home building and charges to restructure its Laminex unit dented first-half earnings.

Mainfreight, the transport group, fell 0.5 percent to $9.60. Last week the company reported quarterly earnings that disappointed some analysts. Both Mainfreight and Fletcher cited weak demand in Australia among reasons for the results.

"Companies with exposure to the Australian economy have struggled a little bit," said James Lindsay, equities manager at Tyndall Investment Management. "There's not too many times New Zealand looks better than the lucky country. They are cutting rates for only one reason."

Skellerup Holdings, the rubber goods manufacturer, fell 0.7 percent to $1.42 after reporting first-half profit rose 17.2 percent to a record despite some worsening market conditions, particularly in Europe and Australia. Net profit for the six months ended Dec. 31 rose to $11.5 million from $9.8 million in the same six months of 2010.

Chief executive David Mair said Skellerup has been repositioned so it can grow earnings even with relatively flat sales and increasing competition.

Port of Tauranga rose 0.6 percent to $10.86, having traded as high as a record $11 after New Zealand’s biggest export port posted a record first-half profit that beat estimates. Container volumes rose and it won business from strike-bound rival Ports of Auckland, lifting profit by 22 percent to $34.6 million for the six months ended Dec. 31.

The port expects to post full year profit of between $69 million and $72 million, up from last year’s $58.4 million.

"What a great franchise," Lindsay said. "It shows the management team is really focussed and the competitor is sort of in disarray."

Vector rose 1.6 percent to $2.61. The Auckland-based electricity, gas and telecommunications distribution network owner, posted an after-tax profit of $105.3 million for the six months to Dec. 31, up 6.9 percent on a year earlier. Sales rose 0.8 percent to $634.3 million.

Cavalier, the carpet maker, was the biggest gainer on the NZX 50, rising 3.8 percent to $2.18. Fisher & Paykel Appliances declined 6.9 percent to 40 cents.

Telecom, which posts its results tomorrow, rose 0.7 percent to $2.15.

(BusinessDesk)

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