NZ shares finish flat as Sanford rises

The New Zealand sharemarket finished a choppy week on a flat note but seafood exporter Sanford rose more than 6% after providing an unexpectedly strong annual result.

Friday, November 15th 2024, 6:35PM

by BusinessDesk

Undaunted by a sell-off on Wall Street, the S&P/NZX 50 Index traded reasonably steadily and closed at 12,684.88, down 8.06 points or 0.064%.

The index was down nearly 0.7% for the week and is ahead 7.5% for the year. Trading was heavy for a Friday with 38.56 million shares worth $193.38m changing hands.

Shane Solly, portfolio manager with Harbour Asset Management, said: “We had another day of mixed company upgrades.

Sanford had a good earnings result driven by a better performance from wildcatch and mussels.

"Sanford was still a bit cautious on the outlook but nonetheless its announcement was better than expected. "Steel & Tube highlighted the continuing challenging environment with residential and commercial construction slowing, and for some companies maybe they haven’t reached the bottom yet,” Solly said.

In the United States, the post-election rally cooled when Federal Reserve chair Jerome Powell said there was no hurry in reducing interest rates when the economy was so strong and there was work to do to get inflation all the way down.

Solly said this triggered a rethink – the markets are still expecting a cut by the end of the year but are wondering how many reductions next year.

The Dow Jones Industrial Average was down 0.47% to 43,750.86 points; S&P 500 declined 0.6% to 5949.17; and Nasdaq Composite fell 0.64% to 19,107.65.

Record operating earnings

At home, Sanford surged 24c or 6.27% to $4.07 after reporting a 5.33% increase in revenue to $582.91m and a 96.48% rise in net profit to $19.67m for the 12 months ending September. It is paying a final dividend of 5c a share on December 9.

Sanford’s operating earnings (ebit) of $74.2m were a record. The seafood company said while there have been strong prices for most of the 2024 financial year, “we anticipate there will be price pressure on some species, particularly products to China in full year 2025”.

Steel & Tube Holdings was down 3c or 3.33% to 87c after reporting revenue fell $41.6m to $141.7m in the first four months of the 2025 financial year with demand for steel hitting recent lows and margin pressure intensifying.

Sales volumes declined 8m to 35.5m tonnes during the period ending October. Steel & Tube said some improvement is expected from mid-2025 as interest rate cuts start to stimulate activity in the construction and manufacturing sectors.

Infratil gained 14c to $12.65; Restaurant Brands was up 7c or 2.07% to $3.45; and Millennium & Copthorne Hotels NZ increased 6c or 3.35% to $1.85.

Auckland International Airport was up 7c to $7.28 after reporting a 3% increase in total passengers to 1.58m for October, with international passengers rising 4% to 857,717 and domestics up 1% to 724,196. Passenger numbers were 89% of pre-covid levels.

Special dividend

Asset Plus, up 2.5c or 11.9% to 23.5c, told the market that following the sale of a Graham St property in Auckland at the end of the month, it will pay a special dividend of 5c a share in mid-December from the net proceeds of the sale following repayment of all bank debt.

Used car dealer 2 Cheap Cars was down 2c or 2.38% to 82c after reporting steady revenue of $41.98m and a 47% fall in net profit to $1.67m for the six months ending September, with vehicle sales up 9% to 4119 units. It is paying an interim dividend of 2.2c a share on December 6.

The sustained economic downturn, subdued trading results in October and persistent market volatility has heightened uncertainty around second-half performance, 2 Cheap Cars said. It will likely maintain lower margins for an extended period to achieve greater market penetration and boost profitability.

Ebos Group was down 30c to $36.90; a2 Milk declined 11c or 2.02% to $5.34; Synlait decreased 1c or 2.53% to 38.5c; Sky TV shed 11c or 4.09% to $2.58; Vista Group lost 4c or 3.88% to 99c; and NZX fell 11c or 7.28% to $1.40.

Other decliners were Pacific Edge falling 1.5c or 10.71% to 12.5c; Eroad down 3c or 3.26% to 89c; PGG Wrightson shedding 4c or 2.34% to $1.67; Santana Minerals losing 7c or 10.14% to 62c; and Serko down 7c or 1.84% to $3.73.

Tags: Market Close