Market close: Shares rise, paced by Air NZ on share buyback plan
BUSINESSDESK: Local shares rose, paced by Air New Zealand it said the share price does not reflect the airline's financial performance and it to commence a share buyback scheme. Telecom and Auckland International Airport led declining stocks.
The NZX 50 Index rose 25.11 points, or 0.7%, to 3834.14. Within the index, 30 shares rose, 9 fell and 11 were unchanged. Turnover was about $116 million.
Air New Zealand rose 5.4% to $1.16 and has gained 23% this year. The airline reaffirmed its outlook statement and said it's on track to "more than double normalised earnings before taxation", which clocked in at $91 million in the year to June 30.
"It is a positive sign operationally and financially," says Shane Solly, portfolio manager at Mint Asset Management.
Fletcher Building, New Zealand's largest construction company, gained 1.6% to $6.67. Port of Tauranga, the nation's busiest port, rose 1.9% to $12.69. SkyCity Entertainment Group, the casino company in talks with the government to build Auckland's convention centre, increased 1.6% to $3.78.
Metlifecare, the retirement village operator, rose 0.4% to $2.90. It wants shareholders to sign-off on a 67% rise in the pool for directors' fees after expanding its operations in the merger with Vision Senior Living and Private Life Care. The stock has gained 28% this year.
Shares in rival retirement village operator Ryman Healthcare, rose 1.2% to $4.10.
Stock exchange operator NZX rose 0.9% to $1.13 after appointing former commerce minister Simon Power and TVNZ and NZ Cricket director Therese Walsh to its board, effective December 1.
The gainers were led by OceanaGold, up 8.1% to $4.
"The price of gold is having a strong run," Mr Solly said. "People are becoming more optimistic about the price of gold after the weakening US dollar."
Pumpkin Patch down 1.7% to $1.16. The children's clothing chain yesterday posted a 20% decline in full-year earnings to $10.1 million, meeting its forecast, as "challenging retail conditions" in all markets squeezed margins.
Telecom, the largest company on the NZX, fell 1.6% to $2.38. Auckland International Airport shed 0.4% to $2.62.
Dorchester Pacific, which avoided failure in 2010 by convincing investors to accept a debt-for-equity swap, rose 25% to 20 cents. It agreed to buy debt collection company EC Credit Control from its owner-manager for $18.5 million in cash, stock and earn-outs.
Zintel Group, the NZAX-listed telecommunications company, soared 7% to 46 cents after its shareholders voted in favour of delisting and giving the board the power to call in liquidators after the company sold all of its operating units and resolved a legal dispute.