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MARKET CLOSE: NZ shares fall; Diligent restates accounts

MARKET CLOSE: NZ shares fall; Diligent restates accounts, Fonterra rebounds

Aug 6 (BusinessDesk) – New Zealand shares fell, as Diligent Board Member Services led most tech stocks lower after saying it would restate three years of revenue, delaying its second-quarter results. Fonterra Shareholders’ Fund rebounded in heavy trading on news China hasn’t imposed a blanket ban.

The NZX 50 Index fell 13.984 points, or 0.3 percent, to 4575.501. Within the index, 24 stocks fell, 15 rose and 11 were unchanged. Turnover was $133 million, with $51 million of that made up of Fonterra units.

Diligent, which provides software to help company directors manage their workflows, fell 4 percent to $5.80, trimming its gains this year to 6 percent. The New York-based company will restate financial statements for the 2010, 2011, 2012 financial years and the first quarter of 2013.

“Restating accounts isn’t ideal,” said Greg Easton, an adviser at Craigs Investment Partners. “They lose a lot of credibility over this.” Some investors may have used the news to take some profits in a stock that has soared 392 percent in the past two years.

Xero, the cloud-based accounting company, fell 2.9 percent to $16.50 and SLI Systems dropped 0.9 percent to $2.18. Wynyard Group was unchanged at $1.27.

Fonterra rose 1.3 percent to $6.95, with some 7.6 million units traded in a second busy day, and A2 Corp gained 4.5 percent to 70 cents. Synlait Milk rose 0.4 percent to $2.71.

“It was good news to see there was no blanket ban into China as was reported earlier,” Easton said. Traders were now looking ahead to the GlobalDairyTrade auction overnight “for some proof the market is functioning,” he said. “The credibility of Fonterra is the big issue.”

Shares of Fonterra Cooperative Group, which can only be owned by the cooperative’s farmers, rose 0.9 percent to $6.98. Livestock Improvement gained 0.2 percent to $6.08.

Property for Industry fell 0.4 percent to $1.38. The stock is looking expensive compared to its peers, according to brokerage Craigs Investment Partners which cut its recommendation to ‘sell’ from ‘hold’.

Argosy Property fell 1 percent to 98.5 cents after announcing it has raised $86.9 million in a rights issue and bookbuild to repay bank debt taken on for its recent acquisitions.

Fletcher Building fell 1.4 percent to $8.42 and Telecom gained 0.4 percent to $2.31.

Hallenstein Glasson Holdings fell 1.9 percent to $4.55, leading some retailers lower. Michael Hill International dropped 1.6 percent to $1.26, Restaurant Brands fell 1.1 percent to $2.75 and Warehouse Group dropped 1.1 percent to $3.75.


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