MARKET CLOSE: Shares rise; Kirkcaldie soars on David Jones deal

New Zealand shares rose as Fisher & Paykel Healthcare rose to a month high. Kirkcaldie & Stains surged after it announced a takeover by Australia's David Jones.

The NZX 50 Index rose 6.735 points, or 0.1%, to 5865.441. Within the index, 21 stocks rose, 21 fell and eight were unchanged. Turnover was $121 million.

F&P Healthcare advanced 3.6% to $6.95, just shy of its record high $6.99 in April. Last month, the medical device maker reported a 17% gain in annual profit to $113.2 million, beating earlier forecasts, and said future earnings would rise further. A weaker kiwi dollar also stoked sentiment for the stock, increasing the value of exported earnings.

"Investors continue to buy in after that very good result," said James Smalley, director at Hamilton Hindin Greene. "It might be looking a little bit toppy but then again it does also benefit from the falling kiwi."

Outside the benchmark index, Kirkcaldie jumped 28% to a 10-month high $2.15 after the unprofitable department store announced it would be taken over by the Australian department store chain. The deal frees the board up to make an "early and substantial" distribution to shareholders from available cash, which is expected to exceed the recent market value of the shares.

"It's up purely on the basis they're going to get cash in the bank and they're going to pay it out," Mr Smalley said. "Ultimately, for those investors that have hung in there, it's probably not too bad a scenario."

Nuplex Industries advanced 1.5% to $4.18. The specialty chemical and resin maker last month said it expects to increase its annual dividend by nearly a third and has lifted its payout ratio to 60% of profit.

Restaurant Brand advanced 2.5% to $4.49. New Zealand's largest fast-food store operator increased first-quarter sales 15% to $89.1 million as revenue jumped at fried chicken outlet KFC, its largest unit, and it added more stores to burger chain Carl's Jr.

Xero fell 0.3% to $20.35. The cloud-based accounting software developer said it is halfway to its target of a million customers, adding 25,000 new subscribers since its March 31 balance date.

Spark New Zealand, formerly Telecom Corp, dropped 1.2% to $2.855, snapping four days of gains. Mr Smalley said a falling currency saw offshore investors cut their losses in their New Zealand equities.

A2 Milk Co, the milk marketing company, led the benchmark index higher climbing 9.6% to 57c, with its investor day presentation well received by the market, Mr Smalley said.

Fletcher Building, the biggest listed company, fell 1% to $8.37.

Air New Zealand, the national carrier, was the worst performer on the NZX 50, dropping 2.8% to $2.82.

(BusinessDesk)