Tourism Holdings' bounce is NZX's big story of the day

Tourism Holdings surprised New Zealand’s market with new earnings guidance that pushed the company’s shares up by almost 7% and gave the index a boost as investors wait to see what’s revealed in new inflation data out of the US later this week.

Wednesday, October 12th 2022, 6:00PM

by BusinessDesk

The S&P/NZX 50 Index fell 83.5 points, or 0.76%, to 10,873.23. Turnover was light at $108.1 million.

Craigs Investment Partners' investment director Mark Lister said Tourism Holdings earnings guidance had been the big story of the day, with the guidance coming in a good “million or two” above market expectations.

“It’s not surprising the stock is trading well,” he told BusinessDesk. “It’s a reminder that amongst the gloom, there's a lot of businesses still getting on with things.”

Tourism Holdings shares jumped up almost 7% by midday after it told the market it expects its net profit to be above $30m for the current financial year.

The NZX-listed tourism company said its profit would be above earlier guidance of between $17m and $30.2m in the year ending June 30, 2023.

THL said the improved outlook was a result of a first quarter that exceeded earlier expectations and greater certainty on rental revenue for the upcoming peak season in Australia and NZ.

The shares ended the day up 5.5% to $2.90.

Statistics NZ also said today that annual arrivals into the country exceeded 1 million in the year ended August 2022 – the first time this has happened since the December 2020 year.

Statistics NZ’s population indicators manager Tehseen Islam said August was also the first month in nearly two-and-a-half years where a holiday has been the most popular reason for travel by overseas visitors.

A holiday was the main purpose of travel given by 43% of overseas visitor arrivals in August.

AFT Pharmaceuticals also rose 5% to $3.39 and Westpac up 2.9% to $25.15.

The NZX announced this morning that Westpac director Rob Hamilton will become NZX’s new chair in April 2023.

Hamilton will be joined at the NZX board by Rachel Walsh, who's currently IT service provider Datacom's chief financial officer and previously worked in mergers and acquisitions for Graeme Hart's Rank Group.

NZX shares were also up 2.6% to $1.19 today.

The latest Real Estate Institute of NZ (REINZ) data today showed that house prices are still falling nationwide – amid signs of stabilising.

Nationwide, house prices fell another 0.7% in September, which took the annual decline to 8.1% and the fall from the peak last November to 12.6%.

Across the country, prices fell most in Wellington, down 17.3% from September last year, and Auckland, down 11.2%. However, they rose 5% in Taranaki, 1.1% in Southland and 0.4% in Northland.

Lister said over the next six months commercial property prices would decline.

It was one of the reasons that listed property company stocks were currently trading at lower prices, because the market knew it was coming and investors had accordingly sold off property shares, he said.

Commercial property stocks were a little pinched today with Kiwi Property Group down 2.8% to 87.5 cents and Investore Property falling 1.3% to $1.50. Goodman Property was 0.5% to $2.01.

Today, the NZ dollar was trading at 55.83 US cents at 3pm in Wellington, slightly up from 55.80 US cents on Tuesday.

Tags: Market Close