NZX CLOSE: NZ shares fall as kiwi stays high; PGW, FPH decline

Friday 9th October 2009

New Zealand shares fell for the fourth day in six as the kiwi dollar stayed around 74 U.S. cents, eating into the value of companies’ overseas revenue.

Fisher & Paykel Healthcare fell to the lowest since late July. The NZX 50 Index fell 5.68, or 0.2%, to 3163.25. Within the index, 22 stocks rose, 13 fell and 15 were unchanged. Turnover was $98 million.

F&P Healthcare fell 1.3% to $3.02, the lowest since July 20. The manufacturer of medical devices gets almost 80% of its revenue in U.S. dollars. The kiwi has surged 18% against the greenback in the past three months. Sanford Ltd., the fishing company that exports most of its catch, fell 0.6% to $4.87.

“The currency isn’t helping them,” said Alan Moore, who helps manage $350 million at Milford Asset Management.

Sky Network Television, the pay-TV company with equipment and programming costs in U.S. dollars, climbed 1.7% to $4.78.

The resilient New Zealand dollar prompted some jawboning from Reserve Bank Governor Alan Bollard today, who said the currency’s gain “has not supported the shift towards the export and import-competing industries” necessary to rebalance the economy.

The NZX 50’s 16% gain in the past three months means there are relatively fewer ‘cheap’ stocks. “We’re taking about an economic recovery but when you go through companies on the stock market it isn’t easy to find anything particularly exciting,” Moore said.

PGG Wrightson, the nation’s biggest rural services company, fell 3.2% to 61 cents, leading the index lower.

Weighing on the company, meat cooperative Silver Fern Farms announced the results of its stock offer which showed that while holders of 67.5% of the shares opted to exchange them for new shares that will trade on the Unlisted platform, they only subscribed for $21 million of new stock, below the $30 million-to-$128 million target range. Wrightson is planning its own capital raising.

“I don’t think it is going to be that easy for them,” Moore said.

Scott Technology Ltd., which makes manufacturing systems for industry, gained 2% to $1.01 after reporting a full-year profit tax of $390,000, a turnaround from last year’s loss of $1.2 million.

Smartpay Ltd., the eftpos technology company, soared 21% to 3.5 cents after announcing the acquisition of the ETHOS operating system software from Cadmus Developments, in receivership. The purchase price is capped at $7.5 million over three years. With the acquisition and based on current sales forecasts “appropriate profit guidance for the SmartPay Group is expected to be in the range of $7 million to $10 million EBITDA” for the year starting April 1, 2010, managing director Ian Bailey said today.

Goodman Fielder, the Australasian food and ingredients company, gained 3.5% to $2.10, the biggest gain on the NZX 50 today. The company is in talks to sell its fats and oils business after receiving offers, it said this week.

Freightways Ltd., the courier and logistics firm, rose 3.3% to $3.10 and Mainfreight Ltd., the biggest trucking company on the NZX, gained 1.7% to $5.41.

Businesswire.co.nz

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