NZ market edges down as companies issue bad news

New Zealand’s market flattened out on subdued investor sentiment as horticultural company Seeka and Fletcher Building downgraded their full-year results.

Wednesday, June 21st 2023, 6:15PM

by BusinessDesk

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The S&P/NZX 50 Index edged down 13.1 points, or 0.11%, to 11,776.25.

Turnover on the entire market was $107.4 million and 63 stocks rose while 68 fell.

Craigs Investment Partners investment adviser Peter McIntyre said the quietness in NZ’s share market of late was based on two things: investor concern over weakening demand out of China and a congressional testimony coming out of the US from Federal Reserve chair Jerome Powell on Thursday.

“It's got the markets on watch,” he said.

Seeka told the market it expects its result for the 12 months to December 2023 to show a net loss before tax of between $20m and $25m.

The horticultural company said this was due to much lower than anticipated NZ kiwifruit volumes, packing a total of 29.8m class 1 trays, compared to 42.4m in the previous corresponding period.

Adverse weather conditions – ranging from a severe frost last October, storms earlier this year and wetter conditions during pollination season – didn’t help.

Seeka said it would release its half-year results by Aug 31. The stock fell 8 cents, or 3.2%, to $2.45 at the close on Wednesday.

NZ Rural Land Co, which has its annual meeting on Friday, was up 3 cents, or 3.5%, to 89 cents. Summerset Group, which has had strong trading in the last week, rose 20 cents, or 2.1%, to $9.60.

Channel Infrastructure edged up 2 cents, or 1.4%, to $1.45 while Mainfreight was up 70 cents, or 1%, to $72.40.

Construction softens

Fletcher Building also announced it had downgraded its expected earnings before interest and taxes (Ebit) figure to around $800m for the 12 months to June 30.

“This represents a solid performance as we have seen market activity soften in the second half, along with the ongoing impact of wet weather,” CEO Ross Taylor said in the company’s announcement.

“Fletcher’s downgrade was probably not unexpected,” McIntyre said, pointing to the slowing down in the housing market.

He said the market had reacted to the news in an expected fashion and at one stage during the day the stock had been trading up, before ending the day down 1 cent, or 0.2%, to $5.20.

Across the rest of the listed property sector, stocks were mixed again today. Goodman Property fell 3 cents, or 1.4%, to $2.155, and Investore Property was down 1 cent, or 0.7%, to $1.37.

Kiwi Property Group edged up half a cent or 0.6% to 91 cents, and Property For Industry rose 2 cents, or 0.8%, to $2.405.

The Commerce Commission released a statement today on its market study into personal banking services and how competition is working in the sector.

“We know there is public interest in seeing how competition is delivering for consumers in accounts, lending, and deposit-related products and services – and whether people can switch providers easily,” commission chair John Small said.

ANZ Bank’s chief executive, Antonia Watson, described the competition study yesterday as a “good opportunity to provide facts”.

ANZ edged down 3 cents, or 0.1%, to $26.20 today, while Westpac fell 52 cents, or 2.2%, to $23.20.

Auckland International Airport was up 1 cent, or 0.1%, to $8.41. Earlier today, transport minister Michael Wood resigned from cabinet after more evidence of improper ministerial behaviour came out.

This is just weeks after it was revealed Wood hadn’t sold his shares in Auckland airport – even though he’d been given 12 warnings to sell his $13,000 worth of shares.

Air NZ rose half a cent or 0.6% to 79.5 cents.

Metro Performance Glass revealed Tony Candy as its new chief financial officer, with Candy previously being the CFO of the also-listed Steel & Tube Holdings between 1992 and 2011.

Candy will start on Aug 14.

Metro Performance Glass was down less than half a cent, or 0.7%, to 14.4 cents. Steel & Tube Holdings was up 3 cents, or 2.8%, to $1.11.

On the currency front, the NZ dollar was trading at 61.69 US cents at 3pm in Wellington, from 61.85c on Tuesday.

Tags: Market Close