Pacific Edge rallies for second day on southern district health region deal

Pacific Edge led the New Zealand sharemarket higher for a second day on news the southern district health region would adopt its cancer test.

Thursday, July 21st 2022, 6:06PM

by BusinessDesk

The S&P/NZX 50 Index rose 70 points, or 0.6%, to 11,269.75. Turnover was just $62 million.

Cancer diagnostics company Pacific Edge gained another 4% today at 79 cents, bringing its total gain this week to almost 13%.

The stock rallied yesterday on increased test volumes being processed through its lab and today on news the health authority for Otago and Southland would begin using Cxbladder.

Pacific Edge said it had substantially completed a commercial agreement with the district, which provides healthcare for 326,000 people.

The agreement will mean that 15 of NZ’s 20 health regions – more than 75% of the population – will have access to the test via public healthcare, it said.

Jarden analysts said the test volume trading update yesterday was “broadly in line” with expectations and maintained their 90-cent target price.

Shares in Heartland Group Holdings climbed 2.9% to $2.14 and Fisher & Paykel Healthcare was up 2.6% at $21.55, continuing a recent rally of more than 6% this week.

Eroad once again posted the biggest fall, dropping 5.3% to $1.98, followed by Tourism Holdings which declined 2.4% to $2.43.

Mercury NZ was up 2.2% at $5.98 after announcing it would hold its annual general meeting on September 22. Meridian Energy was also up 1.1% at $4.875.

IkeGPS gave a trading update which showed first-quarter revenue was up 162% on the same quarter last year, at roughly $6.8m.

Chief executive Glenn Milnes said the quarter had an “outstanding period of growth” with expanding contracts with existing customers and winning new ones.

“Including one the five largest engineering companies serving the electric utility market across the US,” he said.

"The outlook remains robust. Following 71% revenue growth in FY22, we expect FY23 to be another significant period of growth."

Milnes said there was an estimated $13m to $15m of revenue backlog from signed contracts that haven’t been delivered yet, meaning 2023 was likely to be a strong year.

Shares in ANZ Bank were up 0.4% at $24.05 after it raised approximately $1.7 billion from institutional investors at $21.65 – $2.75 above the $18.90 offer price.

Competitor Westpac Banking Group also gained half a percent at $22.97.

The NZ dollar was trading at 62.22 US cents at 3pm in Wellington, down marginally from 62.39 cents yesterday. The trade-weighted index was at 71.04, from 71.10.

BNZ strategist Nick Smyth said the kiwi was being supported by some recovery in the European currency. “The NZ dollar has appreciated strongly in sympathy with the Euro, to which it has been highly correlated in recent times,” he said.

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