Stocks to watch: Michael Hill, Horizon Energy, Pan Pacific Petroleum

Wednesday 14th October 2009

The following stocks may be active on the New Zealand exchange after developments since the close of trading yesterday.

Themes of the day: Stocks on Wall Street fell after Johnson & Johnson posted quarterly sales that missed estimates and analyst Meredith Whitney cut her rating on Goldman Sachs Group to ‘neutral.’ The kiwi dollar rose to 73.68 US cents from 73.63 late yesterday. The government is scheduled to release its accounts for the 12 months ended June 30, which are expected to show the impact of lower-than-expected tax revenue.

Air New Zealand (AIR): Tests with blended winglets on its Boeing 767-300ER aircraft have delivered better than expected full savings. Once the 3.4m wing-tip devices are fitted to all five of its 767’s, the national carrier’s annual fuel savings are expected to be seven million litres rather than six million, equivalent to 18.400 tonnes of carbon emissions. The shares rose a cent to $1.34 yesterday.

Horizon Energy Distribution (HED): Shareholders of the Bay of Plenty-based lines company were advised to reject a 51% partial takeover by Marlborough Lines Ltd. at $3.96 per share. The stock last changed hands at $3.40.

Infratil (IFT): The investment group’s NZ Bus unit offered to lift its lock-out notice provided its drivers and cleaners agree not to work to rule. The transport authority has said it would consider rescinding NZ Bus’s contract if the dispute, which has affected 80,000 consumers, endures. The shares fell 1.2% to $1.62.

Kiwi Income Property Trust (KIP): The property company’s $66 million, or 3.5% lowered revaluation of its property assets to $1.83 billion was slightly better than expected according to analysts. Though now stabilising, the major factor in the fall was a softer outlook on market rents. Shares remained unchanged yesterday at $1.09.

Michael Hill International (MHI): The jewellery chain that gets three quarters of its revenue in Australia, fell 4% to 69 cents yesterday after reporting margins contracted in Australia and New Zealand on discounting and promotions.

Pan Pacific Petroleum (PPP): The oil company tumbled 11% to 58 cents yesterday after the company said it missed out on a stake in a Vietnam prospect. In May the company entered into a farmin agreement with Premier Oil Vietnam South for a 15% interest in an offshore block. The deal was subject to waiver of pre-emption rights by PetroVietnam, which has exercised the rights. NZ Oil & Gas (NZO), which owns 15% of Pan Pacific, declined 4.5% to $1.69 yesterday.

Warehouse Group (WHS): Retailers were boosted with Statistics NZ figures showing August sales figures up 1.2% for the month, following July’s 0.6% decline. Economists were also taken by surprise with the figure well ahead of expectations. Clothing sales in particular surged during the month. Warehouse shares fell three cents yesterday to $4.45.

Businesswire.co.nz

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