Market close: shares rise on Ryman record profit, Rakon punished

BUSINESSDESK: New Zealand shares rose, led by Ryman Healthcare, after the retirement village operator posted record earnings. 

Briscoe Group rose after the retailer said it will pay a special dividend, while Rakon fell after posting a slide in profit.

The NZX 50 Index rose 7 points, or 0.2%, to 3521.51. Within the index, 17 stocks rose, 23 fell and 10 were unchanged.

Turnover was $96.8 million.

Ryman rose 2.8% to $3.34, a record close. New Zealand’s largest rest-home company today posted a 17% increase in underlying profit to a record $84m in the 12 months ended March 31.

Sales rose about 20% to about $155m. The company has now recorded 10 years of earnings growth.

Rival rest-home operator Summerset Group rose 2.4% to $1.71.

“Ryman is being rewarded for another great result," said Adrian Vance, a director at brokerage Hamilton Hindin Greene.

"Summerset probably benefited on the back of Ryman's result."

Sky Network Television, the pay-TV company controlled by News Corp, gained 2.6% to $5.20, recovering from being punished yesterday after the regulator said it would look into the company’s content deals with internet service providers.

The stock is rated "outperform" based on a Reuters survey of analysts.

Rakon tumbled 9.3% to 49 cents after the manufacturer of crystal oscillators used in mobile phones and navigation systems said a high kiwi dollar and weaker demand from the telecommunications industry weighed on full-year earnings.

Earnings before interest, tax, depreciation and amortisation fell 47% to $13m, including a share of EBITDA from associates and joint ventures.

The bottom-line result was a loss of $420,000 in the year ended March 31, from a profit of $8.48m a year earlier.

“Much of the bad news is captured in the share price already," Mr Vance said.

Briscoe Group, the homeware and sporting goods retailer, gained 8.3% to $1.69 after announcing it will pay a special dividend of 10 cents a share next month.

The stock has gained 14% this year, outpacing a 9.4% in an NZX index of consumer stocks.

Goodman Property Trust, which owns the Highbrook Business Park in Auckland, fell about 1% to $1.025 after saying distributable earnings declined as it paid more tax.

Distributable earnings fell to $74.8m in the 12 months ended March 31, from $78m a year earlier.

The company’s tax bill more than doubled to $13m in the year after its effective tax rate rose due to the government's 2010 decision to remove building depreciation as a tax deduction.

OceanaGold, the operator of the Macraes gold field, rose 2.3% from its lowest level in more than three years to $2.27. The shares had been sinking with the price of gold.

"Commodities have been under pressure, the Australian market has been under pressure - we are seeing some bargain hunting in some of these commodity stocks today," Mr Vance said.

Heartland New Zealand, the building society that wants to become a bank, fell 3.9% to 50 cents after Pyne Gould Corp unit Torchlight Securities disclosed today it has sold down its stake in Heartland to 9.8% from 12.2%.

Fletcher Building, the nation’s biggest construction company, gained 1.4% to $6.32. Telecom, the biggest company on the bourse, rose 0.4% to $2.545.