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MARKET CLOSE: NZ shares rise, led by Fonterra Fund

MARKET CLOSE: NZ shares rise, led by Fonterra Fund after Fonterra raises forecast; Spark gains

By Suze Metherell

Sept. 24 (BusinessDesk) - New Zealand shares rose, led by Fonterra Shareholders' Fund, after the dairy cooperative raised its milk payout forecast while maintain its dividend target. Spark New Zealand gained.

The S&P/NZX 50 Index rose 23.59 points, or 0.4 percent, to 5677.93. Within the index, 23 stocks rose, 15 fell and 12 were unchanged. Turnover was $130 million.

Units in Fonterra Shareholders' Fund, which give holders access to Fonterra Cooperative Group's dividend stream, led the benchmark index higher, gaining 4.6 percent to $5.48.

The world's biggest dairy exporter raised its forecast milk payout after posting a 183 percent jump in full-year profit driven by improved returns from its consumer and food service businesses, and improved margins from ingredients. The increase to total payout to farmers for the 2015/16 season to between $5 and $5.10/kgMS, including forecast earnings per share of 40 cents to 50 cents.

"The confirmation of guidance was probably the key," Shane Solly, director at Harbour Asset Management said. "Clearly there's still quite a lot of inventory to work through and the debt levels in the business are certainly substantial. If they can work through the inventory in a reasonable time-frame the debt becomes less of an issue."

Spark, the telecommunications company, rose 2.6 percent to $3.17. Goodman Property Trust, the property investor, gained 1.3 percent to $1.165. Genesis Energy, the utility company, advanced 1 percent to $1.955.

"We're seeing reasonable demand for large-capitalisation yield stocks," Solly said.

Nuplex Industries, the resin and specialty chemicals manufacturer, was the worst performer on the benchmark index, falling 4.8 percent, or 19 cents, to $3.80 as it shed rights to its final 17 cents-per-share dividend.

DNZ Property Fund, which is changing its name to Stride Property, fell 3.1 percent to $2.10 after raising $115 million through the placement of new discounted shares, which it will use to help fund the acquisition of a supermarket property portfolio for $287 million. The 59.4 million share placement was fully subscribed at $1.94 a share.

Outside the benchmark index, Pushpay Holdings was unchanged at $7. The mobile payment app developer was asked by NZX regulation to explain a surge in its shares of $1, or 17 percent, since opening trade yesterday. Pushpay confirmed it was in accordance with listing rules and had nothing further to disclose.

Sanford was unchanged at $4.90. New Zealand's largest listed fishing group has written down the value of its Australian operations by $6.5 million, in the latest tidying up of its books, which it says will give it a more focused approach to marketing across the Tasman.

Briscoe Group, the retailer which failed in its attempt to takeover Kathmandu Holdings, rose 1.1 percent, or 3 cents, to $2.88 after it shed rights to its 6 cps interim dividend.

On the New Zealand Alternative Index, GeoOp, the workforce management app developer, was unchanged at 44 cents after it raised $2.4 million in a private placement that brings on two new Australian investors, whose networks it says will open doors across the Tasman.

(BusinessDesk)

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