Market close: Shares fall, paced by Fletcher and Trade Me

BUSINESSDESK: New Zealand shares fell, led by Fletcher Building and Trade Me, after they missed earnings estimates. PGG Wrightson gained after a return to profit.

The NZX 50 Index fell 29.35 points, or 0.8%, to 3658.37. Within the index, 24 stocks fell, 19 rose and seven were unchanged. Turnover was $122.6 million.

Fletcher fell 5.1% to $6.32. The country's biggest construction and building products company reported a 12% drop in annual earnings before one-time charges to $317 million on sales growth fuelled by the first full-year contribution from Australia's Crane Group.

"The share price had been moving higher on the expectation of a better result – there was not a lot of positive commentary in the report," says Grant Williamson, director at Hamilton Hindin Greene. 

Trade Me, the online auction site spun off by Fairfax Media in December, fell 2.5% to $3.87 after its inaugural results as a listed company showed annual sales growth lagged behind estimates.

Profit rose 8.4% to $75.6 million in the 12 months ended June 30. Sales increased 13.8% to $142 million. Analysts had expected profit of $70 million on revenue of $146 million.

"The share price ran pretty hard into the result so there was room for disappointment," Mr Williamson says. "These companies can come out with guidance but directors can't let expectations get hyped."

New Zealand Oil & Gas fell 0.6% to 83.5 cents after posting a full-year profit of $19.9 million as it puts behind it the disastrous foray into the Pike River coal project that saw it plunge to a $76.5 million loss the previous year.

Telecom, the largest company of the exchange, fell 1.1% to $2.775. It will post its full-year results on Friday and Forsyth Barr analyst Guy Hallwright has forecast a 14% increase in sales to $4.7 billion and a 37% rise in reported profit to $330 million.

"It is going to be interesting to see what Telecom produces – the share price has been improving nicely so investors will be expecting some good things," Mr Williamson says.

Chorus, the telecommunications network operator spun out of Telecom last year, fell 2.5% to $3.17.

The gains were led by PGG Wrightson, the country's biggest rural technology and services provider, up 9.4% to 35.

The Christchurch-based company returned to profit in the 2012 financial year off a 40% gain in earnings from its services unit. Net profit was $24.5 million in the 12 months ended June 30, turning around a loss of $30.7 million.

Cavalier, New Zealand's only listed carpet maker, rose 6.1% to $1.75. OceanaGold, which operates the Macraes gold mine near Dunedin, rose 3.9% to $3.22.

Dual listed Pacific Brands, the Australian apparel company with brands including Bonds, Sheridan, Stussy and Mossimo, was unchanged on the NZX at 75 cents and fell 1.7% to 58 Australian cents on the ASX.

The company widened its annual loss after writing down goodwill by $A502.7 million and said chief executive Sue Morphet will leave after five years in the job.

Shares in New Zealand Experience, which owns Auckland's Rainbow's End amusement park, rose 2.6%  to 39 cents after it posted a 3.6% fall in full-year profit to $1.4 million after a one-time charge to upgrade its facilities offset stronger sales.

The company has agreed to assist its biggest shareholder to find a buyer for its stake, which may lead to a full takeover.

Fisher & Paykel Healthcare, which makes respirators and sleep apnea products, rose 4.1% to $2.04 after raising the bottom end of its forecast for annual earnings on stronger first-half trading and after revising its assumption for the New Zealand dollar.

The Auckland-based manufacturer expects to post annual net profit of between $65 million and $69 million on sales of between $540 million and $550 million, chief executive Michael Daniell told shareholders at today's annual meeting.

That compares to previous profit guidance of between $62 million and $70 million on revenue of between $540 million and $560 million.