MARKET CLOSE: NZ shares rise as Sky TV earnings surprise
MARKET CLOSE: NZ shares rise as Sky TV earnings surprise, paced by Telecom
By Suze Metherell
Feb. 24 (BusinessDesk) – New Zealand stocks rose, led by Sky Network Television, after the nation’s pay-TV operator posted earnings that beat estimates. Telecom rebounded from a selloff on Friday when it posted a modest gain in earnings and announced a rebranding strategy.
The NZX 50 Index rose 42.005 points, or about 0.9 percent, to 4969.645. Within the index 21 stocks rose, 19 fell and 10 were unchanged. Turnover was a larger-than-average $179 million and included about $47 million of Telecom stock.
Sky TV jumped 5.7 percent to $6.08, leading the index higher. New Zealand’s dominant pay-TV company posted a first-half net profit of $82.1 million on lower programming costs and as more subscribers switched to its premium services.
Telecom rose 3.2 percent to $2.45. The nation’s biggest telecommunications provider disappointed investors on Friday after it posted a 2.5 percent gain in first half earnings, announced plans to rebrand as Spark and develop an internet television service to rival Sky TV.
Of New Zealand’s top fifty listed companies, nearly half have reported first-half or full-year earnings over the past two weeks.
“Sky TV came out with a positive surprise, which is good, they’ve had a strong day,” said David Price, broker at Forsyth Barr. “It’s actually been a familiar sort of thing with this results round - we’ve seen companies that have disappointed get hammered on the day, and then the following trading day they make up for what they lost the previous day.”
Among companies that reported earnings last week, Fletcher Building, New Zealand’s biggest listed company, rose 1.2 percent to a three month high $9.87. Auckland International Airport rose 1 percent to $3.735 and Sky City Entertainment Group rose 2.9 percent to $3.91. Online auction site Trade Me Group slipped 0.5 percent to $4.03.
Freightways gained 2.8 percent to $4.70. New Zealand’s largest listed courier service reported a 3 percent lift in its first-half earnings and growth in its secure data destruction business.
“Freightways was a positive result, we saw some good volume growth for the first time in a while, and the outlook from them was positive,” Price said.
Chorus fell 1.1 percent to $1.42. The telecommunication provider reported a 7.1 percent decline in first-half profit and won’t pay an interim dividend as it prepares for regulated price cuts on its copper wires in December.
Xero, the cloud-based accounting software company, rose 0.4 percent to $39.95 and has risen 23 percent this year. Fellow growth stock Wynyard Group lifted 0.4 percent to $2.87. The intelligence software company listed July last year and has more than doubled from its listing price of $1.10.Wynyard today beat its own annual sales forecast while burning through more cash than expected.
Retirement village operator Summerset Group Holdings rose 0.9 percent to $3.33, Heartland New Zealand, the bank formed from the merger of the Canterbury and Southern Cross building societies and Marac Finance slipped 1.1 percent to 90 cents. Guinness Peat Group, which owns industrial thread maker Coats, was unchanged at 67 cents. All three companies report earnings tomorrow.