Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


UPDATE: Scales shares edge lower on NZX debut

UPDATE: Scales shares edge lower on NZX debut raising $30M of new capital to repay debt

(Updates with price movements, company and investor comments)

By Suze Metherell

July 25 (BusinessDesk) - Shares in Scales Corp slipped 0.6 percent in early trading on their NZX debut as the fruit and vegetables logistics company's raised $30 million of new capital to reduce debt.

The shares recently traded at $1.59, having first traded at $1.61, largely flat compared to the $1.60 IPO price. Some 2 million shares of the company's 139.8 million shares on issue changed hands. Private equity firm Direct Capital sold into the $148 million offer, reducing their stake to 20 percent from 84.2 percent. The firm held the shares with co-investors ACC and the New Zealand Superannuation Fund. The company's $222 million market value makes it the 60th biggest New Zealand stock on the bourse.

"First point of call will be to reduce debt with it," managing director Andy Borland told BusinessDesk, referring to how the new capital raised will be used, and said he expects average prospective net debt to be $44.1 million.

Scales is New Zealand's largest apple exporter, and also owns businesses across the primary sector including, sea and air freight services, cold store operations, and food ingredients, including pet foods and juice concentrate businesses. Last year the company lifted profit 50 percent to $20.4 million in calendar 2013, on the back of rising Asian demand for apples.

"We are lifting our apple production with more apples targeted for Asia, and we're going to support that with a bit more investment in the overseas' market," Borland said. To support more apples the company is expanding its cold store network to Auckland, and were "very close" to finalising those plans, he said.

The IPO is the latest in a series of floats, which have primarily been tech-based companies seeking growth. Scales's debut comes two days after portable measuring device maker ikeGPS Group shares slumped as much as 18 percent on debut from its $1.10 offer price, and recently traded at 99 cents. Other recent listing, Serko, which makes travel booking software, has also failed to stay above its $1.10 offer price, recently trading at 90 cents.

"It's quite good to have more representation of New Zealand's forte coming onto the market," said Greg Fraser, senior equity analyst at Mint Asset Management, which bought into the offer. "Tech stocks are nice to have but those primary stocks certainly are our bread and butter, if you'll pardon the pun. Its more representative of New Zealand Inc."

Scales forecast net profit to fall to $15.9 million in 2014, before a rise to $20.8 million in 2015, and expects to pay a dividend of between 9.4 cents per share and 9.6 cents per share, and between 10.5 cents to 10.7 cents per share, the following year.

Deutsche Craig and First NZ Capital were lead managers of the offer.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Future Brighter Money: RBNZ Releases New Bank Note Designs

New Zealand’s banknotes are getting brighter and better, with the Reserve Bank today unveiling more vibrant and secure banknote designs which will progressively enter circulation later next year. More>>

ALSO:

Commerce: Supermarket Inquiry Finds No Breaches By Countdown

The Commerce Commission inquiry into anti-competitive behaviour by Countdown supermarkets, alleged by former Labour Party MP Shane Jones, has found nothing to warrant prosecution, although it warns supermarkets to take care in the way they communicate... More>>

ALSO:

Crown Accounts: English Flags ‘Challenge’ To Budget Surplus

Finance Minister Bill English is warning next month’s half yearly fiscal and economic update from the Treasury may not forecast a budget surplus, saying that returning the government’s accounts to surplus in 2015 will be “a challenge”, given the decline in commodity prices and weak global inflation. More>>

ALSO:

March 2015: Netflix To Launch In Australia And New Zealand

World’s Leading Internet Television Network to Offer Original Series, Movies, Documentaries, Stand-Up Comedy Specials and TV Shows for Low Monthly Price More>>

ALSO:

Price Of Cheese (Is Up): Dairy Product Prices Fall To Five-Year Low

Dairy product prices fell in the latest GlobalDairyTrade auction to the lowest level in more than five years, led by declines in rennet casein and skim milk powder. More>>

ALSO:

Gordon Campbell: On The Australians Scoring Trade Points Against Us With The Chinese

It hasn’t been a great year for Trade Minister Tim Groser... To top it off, Australia has just signed a FTA with China that has far better provisions on dairy exports than what New Zealand currently enjoys in our own FTA with China. More>>

ALSO:

Iwi & Local Consultation: Oil And Gas Block Offer 2015 Begins

Energy and Resources Minister Simon Bridges today announced the start of the Block Offer 2015 process for awarding oil and gas exploration permits. More>>

Industrial Action: Stats NZ Throwing Public Money Away Duplicating Data

The Public Service Association (PSA) says Statistics NZ are throwing money away by collecting the same data twice for official statistics such as the Consumer Price Index... As part of the ongoing industrial action, field interviewers who are PSA members are continuing to collect data, but are not sending it through to Statistics NZ. More>>

ALSO:

Other Stats:

Space: Rosetta's 'Philae' Makes Historic First Landing On A Comet

After more than a decade traveling through space, a robotic lander built by the European Space Agency has made the first-ever soft landing of a spacecraft on a comet. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news