Market close: NZ shares mixed - Telecom drops, Summerset up

BUSINESSDESK: New Zealand shares were mixed today. Companies that have rallied the hardest this year, including Telecom, paced the decline. Summerset Group, the retirement home operator that went public in October, set a new record high.

The NZX 50 Index fell 0.96 points, or 0.02%, to 3520.82. Within the index, 24 stocks rose, 12 fell and 12 were unchanged.

Turnover was $103 million.

Equity investors largely looked through the Reserve Bank’s review of interest rates today, which kept the official cash rate on hold at 2.5%.

Still, the kiwi gained after the statement, in which governor Alan Bollard said the high currency is a concern for the economy.

Telecom fell 1.9% to $2.58, having closed on Tuesday at the highest level since the spinoff of its Chorus network business in November.

The stock has a dividend yield of 11.4%. Chorus rose 0.3% to $3.42.

“People are starting to look at whether it is appropriate to take a little profit off the table,” said Michael Milne, an investment adviser at Craig's Investment Partners.

Companies such as Telecom “had a really good first quarter of the year”.

Heartland New Zealand, the building society that wants to become a bank, rose 3.6% to 57 cents and was the biggest gainer on the NZX 50 today.

Pyne Gould, the wealth manager that sold its Marac finance unit into Heartland, fell 2.9% to 34 cents after saying its biggest shareholder, George Kerr, will take over running the company and managing director John Duncan will depart, effective immediately.

Fisher & Paykel Healthcare, which gets more than 50% of its revenue in US dollars, was unchanged at $2.20 and has fallen about 13% this year.

Healthcare “has really been struggling lately given the high dollar”, Mr Milne said.

Tapware maker Methven fell 0.9% to $1.16.

Summerset gained 1.2% to $1.67 and is up 23% this year.

“Summerset is in the same space as Ryman Healthcare, benefiting from the ageing population,” Mr Milne said.

“It’s a long-term play – an attractive industry to be in.”

Ryman, the biggest retirement village operator on the NZX 50, was unchanged at $3.12 and has gained 15% this year.

New Zealand Refining rose 1.1% to $2.75.

The operator of New Zealand’s only oil refinery has a crucial vote at its annual meeting tomorrow on its plan to spend $365 million at the Marsden Pt plant over the next four years.

If it loses the vote, the company’s fall-back position is a $105m refit.

DNZ Property Fund fell 1.4% to $1.39.

The property investor said today that the value of its portfolio is steady and it has increased both its occupancy rate and weighted average lease term (WALT) in the past year.

The fund's occupancy rate was 98.7% as at March 31, up from 97.9% a year earlier.

Its WALT rose to 5.4 years from 4.3 years and, on a like-for-like basis, the portfolio's value rose 1%, or $800,000, it said.

The portfolio was valued at $658.3m as at March 31.

Ecoya, the scented candle maker and skin-care products company, rose 1.8% to $1.16 and has gained 23% this year.