MARKET CLOSE: Shares rise, led by Contact; F&P, MetroGlass advance

New Zealand shares rose after Contact Energy said it would return surplus cash to shareholders. Fisher & Paykel Healthcare and Metro Performance Glass gained ahead of reporting their earnings.

The NZX 50 Index rose 18.964 points, or 0.3%, to 5794.981. Within the index, 20 stocks rose, 15 fell, and 15 were unchanged. Turnover was $111 million.

Contact shares jumped 11% to $6.18 after the energy generator and retailer said it had ditched plans for now to invest in geothermal schemes offshore and will increase returns to shareholders, including a special dividend of 50c a share, payable June 23, and a new ordinary dividend payout ratio of 100% of underlying earnings after tax. The stock had dropped as low as $5.50 when Contact first flagged its offshore plans in February.

"Management had let the market down after announcing that they were going to look at offshore geothermal projects with the money they had on the balance sheet," said Robert Garden, investment adviser at Craigs Investment Partners. "That had disappointed shareholders and the stock got sold off pretty heavily. They've done a 180 degree turn and announced a 50c special dividend today. It's a complete reversal from management but that has been well received by the market today."

Nuplex Industries fell 1.3% to $3.71. The company, which makes resins used in industrial coatings and paint, is forecasting a 64% gain in sales in Asia by 2018 as its expansion of plants in China, Vietnam, Thailand and Indonesia bears fruit. The Auckland-based company expects sales from Asia of about $US400 million by the end of 2018, from $US243 million in 2014, according to a presentation for an investor day in Auckland.

Stocks with a March 31 balance date are reporting earnings to the market, which Mr Garden said had largely been along expectations. Metro Glass, the glass manufacturer, rose 1.7% to $1.85. F&P Healthcare, the breathing apparatus manufacturer and exporter, advanced 1.4% to $6.39. Both stocks are due to report earnings this week.

Spark New Zealand, formerly Telecom Corp, advanced 0.7% to $2.75. Fletcher Building, the construction and building supplies firm, gained 0.4% to $8.56.

Outside the benchmark index, Trilogy International rose 7.5% to $1. The skincare products and scented candle maker announced its first dividend, paying 3.66 per share after annual profit more than tripled to $4.5 million on Australian sales growth and the first earnings from its Ecoya candle brand.

"They've been searching for profit and growth for a while and shareholders have needed to be reasonably patient to date," Mr Garden said. "When a stock starts paying a dividend, it's pretty well received."

Methven rose 0.9% to $1.17. The tap and shower manufacturer and exporter lifted annual profit by 21% to $5.69 million in line with guidance, after the acquisition of a Chinese manufacturing plant widened margins.

Evolve Education Group advanced 4% to $1.04. The childcare operator, which listed in December, reported a smaller than forecast annual loss as it settled a series of acquisitions faster than anticipated, driving higher revenue. The Auckland-based company reported a net loss of $8.1 million in the period May 20, 2014, to March 31, 2015, smaller than the loss of $9.5 million forecast in its November prospectus.

NPT was unchanged at 65c. The listed property investor posted a 16% drop in annual profit to $6.4 million, reflecting a bigger uplift in the year-earlier period from a revaluation of properties.

(BusinessDesk)