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

 


MARKET CLOSE: NZ shares rise; Sky TV gains on earnings

MARKET CLOSE: NZ shares rise; Sky TV gains on earnings, Tower leads on capital gain

By Suze Metherell

Aug. 22 (BusinessDesk) - New Zealand shares rose for the fourth consecutive day as reporting season gave investors confidence in the market. Sky Network Television advanced after beating analysts' expectations for annual profit. Tower rose to a year-high after the central bank lowered it minimum solvency reserve by $30 million.

The NZX 50 Index rose 14.080 points, or 0.3 percent, to 5166.995. Within the index, 25 shares rose, 14 fell and 11 were unchanged. Turnover was $109 million.

So far in the earnings season companies have largely met expectations, giving investors comfort the markets gains are justified.
"It's always nice to see companies having good numbers that the market expects, we haven't had too many disappointments and there were a couple of out-performers," said James Smalley, director at Hamilton Hindin Greene. "It has given people a reason to put additional funds into the market."

Sky TV rose 3.2 percent to $6.72 after New Zealand's dominant pay-TV company posted a better than expected 21 percent gain in annual profit to $165.8 million, the fifth annual gain, as it garners more fees from an increasing number of subscribers and more higher-margin My Sky users.

"It was a solid result from Sky TV, beating expectations," Smalley said. "They've already had one near miss with the Commerce Commission and when you're in any type of business where you are consistently making quite large money it seems to be the way it goes with regulation in New Zealand that sooner or later you're going to fall under the eyes of the Commerce Commission. At the moment investors are certainly happy with that business.:"

Pacific Edge advanced 4.3 percent to 73 cents. The Dunedin-based biotech company has fallen 59 percent from its February high of $1.76.

"A little bit of hype or momentum came out of the stock," Smalley said. "Pacific Edge is no longer the speculative stock, they've actually got a product that they're selling now. They're recovering back from an oversold position."

Tower led the benchmark index higher, up 4.8 percent to a year high of $1.96. The Reserve Bank lowered the general insurer's minimum solvency level to $50 million from $80 million as it progresses through its Canterbury earthquake claims. Tower flagged a return of capital to shareholders once its Christchurch claims are completed.

"The Reserve Bank has allowed it to free up $30 million of capital, which it could potentially use from an acquisition point of view or the company has been reasonably proactive with capital return to shareholders," Smalley said.

Spark New Zealand, formerly known as Telecom Corp, was the day's worst performer down 1.7 percent to $2.86, after it said annual profit doubled to $460 million but anticipates low single digit growth in adjusted Ebitda for the 2015 year, even as revenue is forecast to decline by a low single digit. New Zealand's largest telecommunications provider's rebrand it part of its business overhaul to become a data-driven and mobile-focused operator and away from its traditional infrastructure business, which it shed when it demerged with Chorus.

Xero rose 1 percent to $23.75 after the cloud-based accounting software company said it has more than 147,000 paying customers in Australia and plans a free trial offer of its service through the country's largest telecommunications provider, Telstra.

Seeka Kiwifruit Industries was unchanged at $3.29. The fruit grower and coolstore and packhouse operator said it more than doubled first-half profit to $1.48 million in the six months ended June 30, as challenging trading conditions and rising costs were offset by gains from the sale of its cornerstone stake in Opotiki Packing and Cool Storage.

Cavalier Corp was unchanged at $1.03 after the listed carpet maker posted a 13 percent drop in annual profit excluding one-time restructuring costs last year to $6.6 million, as it battled a high currency and margins were squeezed by rising wool prices.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

What Winter? Temperature Records Set For June 20-22

The days around the winter soltice produced a number of notably warm tempertaures. More>>

Conservation Deal: New Kākāpō Recovery Partnership Welcomed

Conservation Minister Maggie Barry says the new kakapo recovery partnership between DOC and Meridian Energy is great news for efforts to save one of New Zealand’s most beloved birds. More>>

ALSO:

Tech Sector Report: Joyce Warns Asian Tech Investors View NZ As Hobbits And Food

Speaking in Wellington at the launch of a report showcasing the value of the technology sector to the New Zealand economy, Joyce said more had to be done to tell the country's technology stories overseas. More>>

ALSO:

Mediaglommeration: APN Gets OIO Approval For Demerger Plan

APN News & Media has received Overseas Investment Office approval for its plan to split out its NZME unit ahead of a potential merger with rival Fairfax Media's New Zealand operations. More>>

New Paper: Ninety-Day Trial Period Has No Impact On Firms' Hiring

The introduction of a 90-day trial period has had no impact on hiring by New Zealand companies although they are now in widespread use, according to researchers at Motu Economic and Public Policy Research. More>>

ALSO:

Corrections: Serco Exits Equity Stake, Remains As Operator

Serco has sold its equity stake in the company that holds the contract to design, build and run Wiri Prison in South Auckland but continues as sub-contractor to operate the facility. More>>

GDP: NZ Economy Grows Faster-Than-Forecast 0.7%

New Zealand's economy grew at a faster pace than expected in the first quarter of 2016 as construction expanded at the quickest rate in two years. The kiwi dollar jumped after the data was released. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news