Mixed bag of results takes NZ sharemarket down 0.5%

New Zealand sharemarket drifted to a fall of more than half a percent on a mixed bag of local company results – though the commercial property sector is showing signs that valuations are settling.

Tuesday, May 28th 2024, 6:34PM

by BusinessDesk

The S&P/NZX 50 Index was solid in the morning but fell away in the afternoon to close at 11,682.51, down 73.49 points or 0.63%, after reaching an intraday high of 11,779.86.

The steady trading of 34.52 million shares worth $116.42m produced 68 gainers and 72 decliners on the main board.

There were few leads from overseas, with the United States and UK markets closed for their Memorial Day and spring bank public holidays.

The S&P/ASX 200 Index was down 0.20% to 7,772.8 points at 6pm NZ time.

At home, Stride Property was up 4c or 3.25% to $1.27 after reporting a steady full-year income of $94.57m and a net loss of $56.12m, mainly due to a $75.8m reduction in the value of the investment properties.

Stride told the market that property valuations stabilised during the second half of the financial year. Fellow property stock Argosy gained 2c or 1.87% to $1.09.

Goodman Property Trust declined 6.5c or 2.95% to $2.14 on full-year revenue of $244.1m, up 14.2%, and a net loss of $564.9m, including one-off costs of $275.5m for taking its business in-house and valuation reduction of 9.5%.

Goodman reported operating earnings of $121.4m, up 9.3%, and said market rents for prime industrial space have increased.

The big two

Fisher and Paykel Healthcare and Meridian Energy, the two largest local stocks on market capitalisation, led the market down, declining 39c to $27.66 and 11c or 1.75% to $6.17, respectively.

Spark, heading the individual trading list, declined 7.5c or 1.8% to $4.10 on trade worth $15.6m. Auckland International Airport shed 15c or 1.94% to $7.58.

Online travel provider Serko declined 7c or 2.24% to $3.05 after reporting a 48% increase in full-year revenue to $71.18m and a net loss of $15.88m, a 49% improvement from the previous year.

Serko’s total spending of $83.9m was below the guidance of $86m-$90m, and it is expecting revenue of $85m-$92m for the 2025 financial year.

Completed room nights on Booking.com for business increased 65% to 2.5m, and active customers through the platform lifted 10% to 172,000.

Summerset Group fell 39c or 3.87% to $9.69 and Ryman Healthcare declined 11c or 2.88% to $3.71.

Fellow retirement village operator Arvida Group gained 1c to 97c after reporting an 11% increase in revenue to $247.16m and a 69% rise in net profit to $139.36m for the 12 months ending March.

The gross value of sales was 13% higher at a record $427m, despite a soft housing market, and Arvida delivered 201 new units, including 144 villas. It is planning to build 140-150 new homes over the present financial year.

Jeremy Sullivan, investment adviser with Hamilton Hindin Greene, said there was a large discrepancy between Arvida’s NTA ($2.05 a share) and its share price. “Investors are starting to see some value in the retirement village sector.”

Other decliners were Comvita shedding 4c or 2.16% to $1.81; Winton Land down 6c or 2.86% to $2.04; T&G Global decreasing 4c or 2.29% to $1.71; and AFT Pharmaceuticals falling 12c or 3.91% to $2.95.

Insurer Tower gained 2.5c or 3.14% to 82 after staging a strong turnaround in the six months ending March with an 18% increase in revenue to $273.54m and net profit of $36.03m compared with a $5.1m loss in the previous corresponding period.

Gross written premiums increased 20% to $291m, and large events costs were $1.9m compared with $37.3m in the previous period. At the end of May, Tower had closed 97% of Auckland Anniversary flooding and Cyclone Gabrielle claims.

Sullivan said Tower has benefitted from a net increase in premiums and a period of stability for large event claims.

Mainfreight collected $1.50 or 2.26% to $68; Gentrack was up 13c to $9.98; Millennium & Copthorne Hotels NZ increased 9c or 4.89% to $1.93; Eroad improved 2c or 2.11% to $97; and Just Life gained 2c or 9.52% to 23c.

CDL Investments was up 1.5c or 2.24% to 68.5c after holding its annual meeting, which approved an increase in total director fees to $300,000 from $180,000.

Tags: Market Close