MARKET CLOSE: NZ shares fall as Hallenstein profit drops

Wednesday 4th February 2009

New Zealand shares fell, sending the NZX 50 Index to its biggest drop in over a week, after retailer Hallenstein Glasson Holdings announced a profit slump and Telecom exported call centre jobs to the Philippines.

The NZX 50 fell 11.669, or 0.4%, to 2768.618. Within the index, 24 stocks fell, 14 gained and 12 were unchanged. Turnover was NZ$83.7 million.

Hallenstein fell 1.4% to NZ$2.20 after saying first-half profit tumbled as much as 41% as sales fell and competition for sales shrank its margins.

"An intensively competitive retail environment has resulted in margin erosion of approximately 3 percentage points on last year while we protect market share and manage stock levels," the company said today.

Children’s clothing chain Pumpkin Patch dropped 1.1% to 92 cents and Warehouse Group, the biggest retailer on the NZX 50, fell 1.1% to NZ$3.70. Briscoe Group gained 2.7% to 77 cents after managing director Rod Duke yesterday said he was “reasonably satisfied” with a 0.9% drop in fourth-quarter sales given the tough market conditions.

Fletcher Building, the nation’s biggest construction firm, fell 0.2% to NZ$5.53 after Auckland-based real estate firm Barfoot & Thompson reported a decline in house prices and fewer sales last month, from a year earlier.

The Treasury this month forecast the New Zealand economy entered its fifth quarter of contraction in January and economists are predicting more signs of the downturn tomorrow, with the release of the Household Labour Force Survey. The unemployment rate is forecast to have climbed to 4.7% last quarter from 4.3%.

“The outlook for the New Zealand economy remains very poor indeed,” economists at Bank of New Zealand said in a report today. “We have weathered reasonably well stage one of the recession but stage two, the wash from the global rout, is only just hitting us.”

BNZ forecasts the economy will contract 0.9% in 2009.

Tourism Holdings, the nation’s biggest campervan operator, climbed 1.5% to 67 cents as government figures showed tourist arrivals jumped by the most in seven months in December. Short-term visitor numbers rose 3.9% to 205,950, seasonally adjusted, in December from the previous month, according to Statistics New Zealand.

Auckland International Airport, the nation’s busiest gateway, climbed 1.6% to NZ$1.88. Sky Network Television climbed 0.9% to NZ$4.22 amid reports it can barely keep up with demand for its HD service.

Vector the gas and electricity distributor, climbed 0.9% to NZ$2.22 after announcing today that it has established a new NZ$50 million, 3-year term loan facility.

ING Property Trust slipped 3.2% to 61 cents after ING New Zealand, the investor and insurer owned by the ING Group and ANZ National Bank, said it has taken full control of the management company for ING Property Trust and ING Medical Properties Trust, which was unchanged today at NZ$1.16.

New Zealand Refining, the nation’s only refinery, rose 5.1% to NZ$7.02, leading gainers on the NZX 50. TrustPower climbed 1.8% to NZ$7.75 and NZX the stocks exchange manager, rose 1.8% to NZ$5.75.

In Australia, the S&P/ASX 200 Index fell 2% to 3437.9 as a string of companies lined up to sell shares, sapping demand for existing issues.

Westfield Group stock fell 13% to A$10.48, a record low, after the world’s biggest owner of shopping malls sold A$2.9 billion of new shares to help cut debt.
Japan’s Nikkei 225 Index rose 2.8% to 8042.98.

(Businesswire.co.nz)

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