NZ sharemarket holds steady as Ebos dips

Ebos Group slumped more than 6% after pulling out of discussions on a billion-dollar acquisition, but the New Zealand sharemarket held steady.

Wednesday, November 22nd 2023, 6:17PM

by BusinessDesk

The S&P/NZX 50 Index fell early to 11,099.34 but recovered strongly to close at 11,169.8, up 5.38 points or 0.05%, while the five-day rally on Wall Street ended.

There were 66 gainers and 58 decliners on the local market, with 28.13 million shares worth $116.87m changing hands.

Greg Smith, head of retail with Devon Funds Management, said markets in the United States were disappointed that the Federal Reserve minutes did not indicate a cut in interest rates anytime soon.

The Dow Jones Industrial Index declined 0.18% to 35,088.29 points; S&P 500 was down just 0.2% to 4538.19; and Nasdaq Composite shed 0.59% to 14,199.98.

Smith said investors were equally disappointed in the local market that Ebos was not proceeding with a deal. The transaction would have made Ebos a bigger company on the NZX board, and that would have been good for capital markets.

Ebos, a leading Australasian medical products distributor, resumed trading for the first time since Thursday and fell $2.45 or 6.35% to $36.15 after telling the market it had been in discussions on a potential strategic transaction related to its animal care segment. These discussions had concluded, and a transaction would not proceed.

It was speculated that Ebos was lining up Australian pet care company Greencross, carrying a value of $3.5 billion.

In a trading update, Ebos said it has had a pleasing start to the 2024 financial year, with underlying earnings up 8.8% and revenue 8.2% for the four months ending October.

Turners Automotive surged 33c or 7.76% to $4.58 after reporting a record six months ending September. Revenue was up 16% to $214.23m, operating earnings (Ebit) increased 16% to $30.2m, and net profit was $18.5m, up 8%.

Turners is paying a second-quarter dividend of 6c a share on Jan 26. The auto retail division traded strongly with increased sales and is targeting a 10% market share. Turners said the full year looks like it is well ahead of the 2023 financial year, which recorded $389.63m in revenue and $32.56m in profit.

Market leader Meridian Energy increased 9c or 1.8% to $5.10; Infratil rose 21c or 2.13% to $10.06; Napier Port gained 5c or 2.17% to $2.35; Port of Tauranga was up 11c or 2.12% to $5.31; and Seeka added 15c or 5.77% to $2.75.

Vista Group gained 4c or 2.84% to $1.45 after announcing a five-year agreement with leading European chain Pathe Cinemas, which will install the Vista Cloud enterprise platform into its 129 sites with more than 1300 screens.

Scott Technology, which recently swatted off a takeover offer, rose 19c or 5.74% to $3.50 after providing a positive outlook to its shareholders at the annual meeting.

Oceania Healthcare, down 2c or 2.82% to 69c, reported half-year revenue of $131.61m, up 8%, with a 13% increase in sales to 255, including a 38% uplift in new sales of retirement units and care suites. Total assets increased to $2.7b, and operating cash flow was $48m, up 53%.

Other retirement village stocks, Ryman Healthcare, reporting next week, declined 23c or 4.17% to $5.29 on trade worth $18.85m, and Summerset Group, which is coming out of the MSCI Index, was down 13c to $9.62 on trade of $11.36m.

Manawa Energy was down 9c or 1.94% to $4.54; Comvita declined 7c or 2.33% to $2.93; a2 Milk declined 11c or 2.53% to $4.24; Serko shed 7c to $4.12; and KMD Brands was down 2c or 2.47% to 79c.

Tags: Market Close