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The Markets

Continuing surprises drive NZ sharemarket down for sixth day

The New Zealand sharemarket doesn’t like surprises, and it got another one with the resignation of long-time Skellerup Holdings chief executive David Mair.

Thursday, February 15th 2024, 6:21PM

by BusinessDesk

The S&P/NZX 50 Index fell for the sixth day running and closed at 11,640.04, down 21.28 points or 0.18%.

The index has now fallen nearly 1.3% for the year. There were 66 gainers and 73 decliners on the main board, with 35.76 million shares worth $121.08m changing hands.

Mair’s resignation followed those at Fletcher Building the day before – CEO Ross Taylor and chairman Bruce Hassall.

David McConnochie, investment advisor with Forsyth Barr, said the market hasn’t taken these resignations “overly well. Mair has provided steady hands over the last decade or so, and he reflects a key person risk around governance and long-term performance.”

He said Skellerup produced a flat half-year result with its industrial division up strongly, but the market looked through that to Mair’s standing down.

Skellerup fell 31c or 6.46% to $4.49 after reporting a 5% decline in revenue to $157.73 and a 6% drop in net profit to $21.61m for the six months ending December. It is paying an interim dividend of 8.5c a share on March 14.

Skellerup said its industrial division had record earnings before interest (Ebit) of $22.9m, up 7%, and the agriculture division was down 19% to $11.9m. Full-year net profit is expected to be similar to last year’s record $50.9m.

“Our business remains robust, and we expect some of the first half headwinds of customers reducing inventory used in dairy and leisure applications will abate,” Skellerup said.

Mair is stepping down at the end of next month after 13 years in the CEO’s role and is being replaced by the chief financial officer Graham Leaming. Mair will stay on as a director and co-lead an in-market capabilities project.

Winners and losers

Vital Healthcare Property Trust was down 1c to $2.13 after reporting steady revenue of $72.4m for the six months ending December and a net loss of $113.12m driven by a $161.19m reduction in the value of its $3.2 billion portfolio.

Vital Healthcare has gearing of 38.3%, occupancy of 98.2% and is paying an interim dividend of 2.4c a share on March 21. The property trust, which has sold off $220m worth of assets, is spending $170m on nine developments over the next 12 months, including the completion of Wellington Wakefield Hospital and Auckland Ormiston Hospital.

Fletcher Building fell a further 26c or 7.2% to $3.35 on trade worth $27.54m following its tough half-year financial result.

Meridian Energy declined 6c to $5.60; Ebos Group decreased 17c to $36.74; a2 Milk was down 8c to $5.43; Seeka gave up 6c or 2.27% to $2.58; and Winton Land shed 6c or 2.46% to $2.38.

Auckland International Airport, up 1c to $8.16, told the market that total passenger volumes increased 20% to 1.71 million in January compared with the same month last year. International passengers rose 28% to 1.019 million, the best since January 2020.

In the retail sector, Hallenstein Glasson was down 14c or 2.48% to $5.51; Michael Hill decreased 3c or 3.41% to 85c; and KMD Brands declined 2c or 3.17% to 61c.

PGG Wrightson fell 18c or 5.64p% to $3.01; T&G Global gave up 6c or 3.21% to $1.81; ikeGPS declined 3c or 5.56% to 51c; Cooks Coffee was down 1.5c or 5% to 28.5%; and Eroad decreased 4c 4.55% to 84c.

Gentrack increased 5c to $7.37 and has risen 164% over the past 12 months. Fisher and Paykel Healthcare was up 30c to $24.10; Serko collected 10c or 2.44% to $4.20; Argosy Property added 2.5c or 2.26% to $1.13; and Chatham Rock Phosphate gained 0.006c or 5.04% to 12.5c.

NZ Oil & Gas, up 0.005c to 37.5c, has increased its interest in the Northern Territory Mereenie oil and gas field to 50% after buying Macquarie Mereenie’s 25% stake for A$42.5m (NZ$45.25m). The acquisition will double NZOG’s reserve and production from the Mereenie field.

Rua Bioscience, unchanged at 9.8c, is taking legal action against Cannoperations Pty for breach of contractual rights to sell its medical cannabis products in Australia exclusively.

Tags: Market Close

« Fletcher, US CPI cast shadow over NZ sharemarketNZ sharemarket bounces back after Fletcher Building recovery »

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