NZX CLOSE: NZ shares slip as earnings dominate; Telecom, Westpac fall

Friday 21st August 2009

New Zealand shares fell as companies including Telecom Corp. and Sky Network Television posted weaker earnings and Air New Zealand reported a continued decline in passenger volumes.

The NZX 50 Index fell 18.15, or 0.6%, to 3034.94, the fourth decline in five days. Within the index, 22 stocks fell, 16 rose and 12 were unchanged. Turnover was $117 million.

Telecom (NZX: TEL ), the biggest company on the NZX 50, fell 1.1% to $2.64 after posting a 56% decline in fourth-quarter earnings on a weaker-than-expected performance in its mobile business. Earnings will fall as much as 23% in 2010, the company said.

“The mobile figures, on the whole, disappointed expectations somewhat,” said Alan Moore, who manages the equivalent of NZ$300 million for Milford Asset Management. “They may be holding back a wee bit for when things are looking better again.”

Westpac Banking Corp (NZX: WBC ) fell 4.9% to $27.40 on the NZX after Australia’s largest lender reported third-quarter cash earnings of A$1.1 billion, little changed from a year earlier. Impairment charges rose to A$865 million from A$811 million. The ASX-listed shares fell 2.7% to A$22.68.

Australia & New Zealand Banking Group (NZX: ANZ ) fell 4.4% to $23.10. Among other Australian companies listed on the NZX, Goodman Fielder (NZX: GFF ) fell 5.5% to $1.73 and Telstra Corp (NZX: TLS ) declined 4.6% to $4.32.

The S&P/ASX 200 Index declined 2% to 4290.60 in Sydney today. APN News & Media sank 5.4% to A$1.68 after the publisher of the New Zealand Herald reported a 53% decline in first-half profit as advertising revenue fell. Its New Zealand shares were unchanged at $2.18

Air New Zealand (NZX: AIR ) fell 3.9% to $1.22 after the airline released its July passenger figures, which showed international volumes tumbled 17%. Domestic passenger numbers fell 5.2%

Fisher & Paykel Healthcare (NZX: FPH ) gained 3.4% to $3.36 after chief executive Michael Daniell told shareholders at their annual meeting today that earnings will grow as much as 25% in 2010 as higher-than-expected sales make up for the impact of a stronger kiwi dollar on overseas sales.

“Demand has been strong, and we have seen accelerating growth, as a result of the introduction of new products, in the OSA product group,” Daniell said, referring to the company’s obstructive sleep apnea products.

Cavalier Corp (NZX: CAV ), the carpet maker, rose 4.2% to $2.50 after posting a 17% decline in annual profit to $14.9 million, beating its own guidance, while gaining market share in tough economic conditions.

Turners Auctions (NZX: TUA ), New Zealand’s biggest single seller of motor vehicles, jumped 9.9% to $1 after reporting a 69% gain in first-half earnings as it slashed spending in a declining market.

Sky Network (NZX: SKT ), New Zealand’s biggest pay-TV company, slipped 0.7% to $4.40 after posting a 9.6% decline in full-year profit on costs for the introduction of its digital TV and high definition service. It kept its final dividend unchanged at 7 cents a share.

Commissioning of HD television “introduced a new layer of fixed costs to the business, the benefits of which will be realized as an increasing number of subscribers choose these new services,” chief executive John Fellet said.

Briscoe Group (NZX: BGR ) climbed 4.4% to $1.20 after managing director Rod Duke said the retailer first-half profit jumped to about $6.5 million, up from an earlier forecast and more than double the year earlier profit.

NZ Farming Systems Uruguay (NZX: NZS ) gained 6.7% to 48 cents, leading the index higher.

Businesswire.co.nz

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