NZ sharemarket slips as Sky TV rejects takeover bid

The New Zealand sharemarket slipped today as Sky TV knocked back a takeover offer.

Wednesday, November 8th 2023, 6:19PM

by BusinessDesk

The S&P/NZX 50 Index closed at 11,151.3, down 72.56 points or 0.65%. This followed a fall yesterday after five sessions in a row of gains.

The index has declined 2.8% for the year after being down 10% not so long ago.

There were 61 gainers and 62 decliners on the main board, with 23.5 million shares worth $77.19m changing hands.

Jeremy Sullivan, investment advisor with Hamilton Hindin Greene, said the market has fallen 1.4% for the quarter and “there’s been a nice turnaround. It is no longer in correction territory.

He said the market was always going to give back some of the gains made at the close the day before. “There appeared to be some portfolio reshuffling, and some of the larger stocks moved around (price-wise).

“We have had a shot in the arm on the optimism in the United States that interest rates may have peaked. And with the election uncertainty removed, the local market is looking for a positive end to the year,” Sullivan said.

In the United States, the Nasdaq Composite, rising 0.9% to 13,639.86 points, and the S&P 500, up 0.28% to 4378.38, notched their longest winning streak since November 2021.

Sky falls

At home, Sky Network Television was down 15c or 5.28% to $2.69 after telling shareholders at the annual meeting it has discontinued discussions with an unidentified third party wanting to make a takeover offer.

Sky TV said, “the end of the first quarter sees us firmly on track to deliver on guidance. An exceptional sporting calendar including several world cup events led to an increase in sports penetration and has driven a positive impact on revenue”.

The television channel expects full-year revenue of $150m-$160m and net profit of $45m-$55m.

Sullivan said Sky TV’s price rose 33% when the takeover bid was announced, and “maybe there is some more room for the price to decline. But the company has reinstated its share buy-back.”

The energy sector was mixed. Mercury fell 12c or 1.98% to $5.95; Contact was down 12c to $7.98; and Meridian declined 7.5c to $4.955. But Manawa was up 17c or 3.97% to $4.45, and Vector gained 7c or 1.9% to $3.75.

Mainfreight shed $1.42 or 2.41% to $57.59; Fisher and Paykel Healthcare was down 30c to $22.48; Infratil declined 12.5c to $10.275; and Ebos Group decreased 74c or 1.96% to $37.

Chorus declined 6c to $7.42 following its annual meeting. The telecommunications network company told shareholders that New Zealand was ninth among OECD countries for fibre uptake and it was time to accelerate the copper disconnection discussion.

Vulcan Steel was up 10c to $7.55 after reporting a 9% decline in revenue for the first four months of the 2024 financial year. The company told shareholders at the annual meeting that lead activity indicators for NZ were showing some improvement in the second half, but the outlook for Australia appears to be weakening.

Vulcan said operating earnings (Ebitda) were down 29% due to lower volume, reduced revenue per tonne and increased operational costs because of inflation.

Other decliners were Heartland Group shedding 5c or 2.96% to $1.64; Move Logistics down 3c or 5.17% to 55c; Smartpay falling 17c or 11.89% to $1.26; and CDL Investments decreasing 2.5c or 3.09% to 78.5c.

Takeover target MHM Automation increased 7c or 4.58% to $1.60; Oceania Healthcare collected 4c or 5.8% to 72c; Eroad gained 5c or 7.25% to 74c; Property for Industry improved 6c or 2.79% to $2.21; PaySauce rose 2.5c or 11.9% to 23.5c; and Solution Dynamics added 5c to $3.73.

Tags: Market Close