In case you missed it: News bites for the week.
Vital cabling.
Dual-listed payment terminal provider Smartpay has reported a $723,000 after-tax loss for the year to the end of March, down from an $8.4 million profit in the prior year. Consolidated revenue was up 8.5% to $104.7m, from $96.5m in FY24, while earnings before interest, tax, depreciation and amortisation dropped from $21.3m to $16.6m due to a $4.9m "pre-investment" in its New Zealand business. The investment is intended to spur future revenue growth, as it continues with a plan to become an "acquirer", allowing it to clip the ticket between the consumer, the bank and the card issuers. The company said the result reflected "ongoing execution and growth in the Australian market in a challenging economic environment ... We have continued with our approach of measured investment in our growth, leveraging operating cash flows and available debt facilities to position the business best to both deliver on short term tactical opportunities and longer-term strategic potential."
Rocket Lab has agreed to acquire Arizona-based company Geost for US$275 million in a deal it said marks its formal entry into the satellite payload segment, and strengthens its position as a provider of end-to-end national security space solutions. Geost is an "electro-optical and infrared (EO/IR) payload development and manufacturing company and provider to high-priority national security satellites". It is currently owned by Lightridge Solutions, a portfolio company of ATL Partners. The deal involves a mix of US$125m of cash, US$150m in privately placed Rocket Lab stock and up to US$50m in potential additional cash earnout payments tied to revenue targets. Rocket Lab CEO Sir Peter Beck said the deal would bring advanced EO/IR payloads in-house "to support secure, responsive, and cost-effective systems at scale". He said the tech would enable spacecraft to detect, interpret and respond to threats in real time, and would enhance its role as a trusted provider to the US and its allies.
Sue Tindal.
Infrastructure Commission deputy chair Sue Tindal has been appointed chair of KiwiRail and the New Zealand Railways Corporation. Port Taranaki chair Jeff Kendrew has been appointed deputy chair of KiwiRail, while Rob Jager, who has been acting chair since last year, remains on the board. Liz Ward has been reappointed to the KiwiRail board, and Nicola Greer has been reappointed to the NZ Railways Corporation board. Rail Minister Winston Peters said the new appointments to KiwiRail brought commercial, freight and rail experience to the board. “We want railways to be successful for New Zealand and have every expectation that a focus on lower cost, higher reliability, increased volumes, improved safety and better performance will be delivered on,” Peters said.
Former Trade Minister and ambassador to the US, Tim Groser, has been appointed chair of a new Supercritical Geothermal Governance Group, as the Government ramps up efforts to tap into New Zealand’s deep geothermal resources. Regional Development Minister Shane Jones says exploratory drilling is about a year away, with potential sites in the Taupō Volcanic Zone soon to be finalised. The $60 million initiative, funded from the Regional Infrastructure Fund, aims to drill exploratory wells reaching depths up to 6km — nearly double current geothermal wells — to access energy outputs potentially three times greater than conventional geothermal systems. Alongside Groser, the governance group includes prominent Māori leader Dr Charlotte Severne, former Transpower chairman Keith Turner, and Vector chief financial officer Jason Hollingworth.
El Cheapo Cars has been sentenced in the Porirua District Court for failing to provide key information to borrowers about their loans. The Wellington-based motor vehicle trader and finance lender pleaded guilty to seven charges the Commerce Commission filed under the Credit Contracts and Consumer Finance Act (CCCFA). El Cheapo Cars has now been fined $115,000 and ordered to pay $341,931.46 in compensation to hundreds of affected borrowers. El Cheapo Cars breached its obligations under the CCCFA when providing personal and vehicle finance to borrowers between 2015 and 2021. The commission opened its investigation into El Cheapo in October 2021, following a customer complaint. The ComCom has also filed civil proceedings against Go Car Finance and Second Chance Finance in the High Court, with allegations that both lenders also breached the CCCFA when providing car finance to borrowers.
NZX-listed Promisia Healthcare has reported upbeat annual results because of acquisitions, as it targets “sustainable expansion” in New Zealand. The company’s revenue rose 37% to $31 million in the year ended March, compared with the previous year. Net profit was up 318% to $6.8m. Chair Rhonda Sherriff said it was well-positioned for sustainable expansion after building a strong financial and strategic platform. During the year, the company purchased two care facilities and villages in Cromwell, completed the sale of the Eileen Mary facility, and actioned a $4.7m capital raise and share consolidation. It said revenue growth was driven by the Cromwell acquisitions, increased occupancy across several facilities, and growth in deferred management fees from villa and care apartment sales. Net profit growth also reflected improvement in operational earnings and recognition of a $6.6m gain from acquisitions.
Gentrack and Amber executives.
NZX-listed software company Gentrack has agreed to invest another A$4.5 million in Australian electricity retailer Amber, as part of an A$45m funding round. Gentrack announced an A$12m ($12.9m) investment in Amber as part of its A$29m Series C funding round, and a strategic partnership, in February last year. In a short market announcement today, Gentrack said the partnership "positions both businesses to together meet the rising global demand for customer-centric, smart energy services. Amber’s strategy includes licensing its technology through Gentrack’s global network of utility customers, offering bundled solutions that combine Gentrack’s billing and CRM systems with Amber’s automation software." Gentrack reported last week that its $7.2m net profit after tax for FY25 included its $1.1m share of a loss from the 10% investment in Amber.
Blackpearl Group has reported a $9.2 million loss for FY25 – wider than the prior year’s $5.4m loss – as its annual recurring revenue rose 70% year-on-year to $12.5m. The NZX-listed lead generation software company reported a 91% rise in subscription revenue, with average revenue per user up 53% since the half-year. Its Pearl Diver product had reached around $10m in ARR, and its new AI-based Bebop offering was ready to scale up, said CEO Nick Lissette. Blackpearl’s gross margin dropped from 71% in FY24 to 68% in FY25, reflecting a temporary duplication of data supply contracts, it said. “As our legacy data provider rolls off in Q1, margin expansion is expected to begin from Q2. Beyond that, Blackpearl will start to see benefits from the new flat fee arrangement, as revenue continues to scale.” The company was targeting $20m ARR within the next seven to 12 months, it said, "with clear visibility toward $50m as Pearl Diver and Bebop both reach critical mass".
The largest shareholder in healthcare and animal care company Ebos Group is looking to sell 13.2% of the company in a block trade worth about $949 million. Sybos Holdings wrote to Ebos yesterday advising the company of its intention. It is understood to have engaged UBS to underwrite the share sale. Sybos will retain a 4.9% stake in the company following the sale and has agreed to an escrow arrangement for that stake for 90 days following the sale. It is Sybos' first sale of Ebos shares since 2020. "Sybos continues to remain supportive of the company's business and announced strategy," the letter said. "Sybos' decision to reduce its ownership in Ebos supports diversification of assets and redeployment of capital to other growth opportunities." Sybos has not had a director representative on the Ebos board for several years and said it did not possess any information that a reasonable person would expect to have a material effect on the price or value of Ebos' shares.
The Canadian investor that made a takeover offer for NZX- and ASX-listed software company Eroad has sold its entire 18.7% stake for nearly $26 million. Brillian, part of the Volaris group, a wholly owned subsidiary of Toronto Stock Exchange-listed Constellation Software, made a $1.30 per share cash offer for Eroad in June 2023, valuing it at $146.8m. At the time, Brillian initially disclosed a 17.73% stake, and then upped it to 18.7% in July. However, Eroad's board dismissed the offer as materially undervaluing the company, and said it would not proceed to due diligence. Brillian then said it had no intention to increase its offer, despite some media conjecture and shares reaching as high as $1.41. A filing to the NZX this morning said Brillian sold 21,318,415 shares on market, via the ASX, for A$24,089,808, which equates to an average price of A$1.13 per share. Yesterday, Eroad's ASX-listed shares were up 15.7% to A$1.25, and up 17% to $1.35 on the NZX.
Inner city commercial developer Precinct Properties has appointed Haydn & Rollett as the main build contractor for the construction of its $290 million student accommodation at 22 Stanley Street. The NZX-listed company announced today it would build the purpose-built, 960-unit facility for the University of Auckland at the Carlaw Park student village in Auckland. In tandem, the company had entered into an investment partnership with a Singapore-based institutional investor, it said. Construction is expected to start shortly on the university project, ahead of its announced plans to build a vertical, 32-level, 638-room student residence at 256 Queen Street. That development would likely come at a cost of $180m, the company said. Precinct chief executive Scott Pritchard said the project supported the "execution of Precinct's pipeline of well-located new student accommodation opportunities". Precinct, as developer and property manager, will retain a 20% interest in the partnership.
The Government has announced a new consolidated funding initiative, He Ara Whakahihiko, designed to bolster Māori-led research and innovation. Science, Innovation and Technology Minister Dr Shane Reti says the fund will "break down barriers Māori researchers and entrepreneurs face," enhancing Māori representation in the science and technology workforce. He Ara Whakahihiko merges two previously separate funding streams with a total investment of $8.6 million. Of this, approximately $2.1 million will fund projects with immediate commercial and economic impact, while $6.5 million is allocated for longer-term collaborative partnerships. Nearly $2 million will go to the Health Research Council. The fund opens for proposals on August 20.
Annual revenue for Cooks Coffee Company through to the end of March was up 44% from about $4.6 million in the prior year to $6.7m. The dual-listed food and beverage retailer behind coffee brand Esquires in the UK, Ireland, and other international markets, reported earnings before interest, tax, depreciation, and amortisation of $1.4m, up from $336,000 year on year. Profit for FY25 tallied $859,000, up from a net loss of $6.3m the prior year when Cooks closed its Triple Two coffee brand. During the latest year, Cooks and its key regional developer partner in the UK formed a joint venture to acquire the Black Goo brand, which has stores in Hertfordshire and Oxfordshire. Moving into FY26, six new stores were opened in the UK in the first eight weeks of the fiscal year. At the end of May, Cooks had a total of 93 stores open, and aims to reach 300 stores by 2034.
New Zealand’s four-largest Australian-owned banks are progressing another industry standard to enable financial technology providers (fintechs) to offer new flexible payment options to customers.
Version 2.3 of the Payment Initiation API standard for open banking, developed by Payments New Zealand’s API Centre, is due to be implemented today.
That enables payment consent so customers can make repeated payments automatically from their own account through third-party services.
Earlier this month, Commerce and Consumer Affairs Minister Scott Simpson said Cabinet had agreed to designate banking as the first sector under the Customer and Product Data Act. “This sets out the rules for how open banking will work in practice in New Zealand.”
“The Big Four banks – ANZ, ASB, BNZ, and Westpac – will need to make sure their open banking systems meet the new requirements by 1 December. Kiwibank will need to be ready by June 2026," Simpson said.
New Zealand King Salmon (NZKS) has lowered its harvest and earnings guidance.
The NZX-listed fishing company said it would reduce its harvest in order to rebuild stock and average fish size.
Due to that decision, NZKS reduced its annual harvest volume forecast to between 5200 tonnes and 5400 tonnes, down from roughly 5900 tonnes to 6300 tonnes guided in March.
As a consequence of the reduced harvest, the FY26 pro-forma earnings before interest, tax, depreciation and amortisation was lowered to between $6 million and $12m, down from between $15m and $24m.
NZKS said it expects harvest volumes to start to recover by September.
Consumers are more downbeat about the economic outlook, following in the footsteps of businesses, according to ANZ.
The ANZ-Roy Morgan Consumer Confidence Index fell five points to 92.9 in May. The proportion of households thinking now was a good time to buy a major household item – a key indicator – was still weak despite rising one point to -10.
Inflation expectations eased a touch to 4.6%. That's still above the key 1-3% target band.
ANZ chief economist Sharon Zollner said the economy was recovering but needed a little more support to ensure it gets through the current global headwinds.
“But no doubt the data will continue to throw up surprises, and the RBNZ is in a good position to respond to developments as they unfold.”
Yesterday, ANZ’s business survey showed confidence fell 12 points to +37, while expected ‘own activity’ fell 13 points to +35. Pricing and cost indicators eased. One-year-ahead inflation expectations rose from 2.65% to 2.71%.
Pharmaceuticals company PharmaZen has given an infringement notice for not filing financial statements on time and fined $7500.
PharmaZen (which also trades as Waitaki Biosciences) is yet to file audited financial statements for the year ended December 31. They were due by April 30.
The company, which is listed on the unlisted platform USX, attributed the delay to ongoing negotiations with their bank about their going concern assessment.
It was noted PharmaZen was also late filing its statements in 2023 and 2024.
PharmaZen told the FMA it intends to publish its financial statements on June 6.
FMA director of markets, investors and reporting John Horne said: "It’s a fundamental obligation that reliable financial statements are made available to the public in a timely manner.
"Entities should report within the required timeframes regardless of challenges impacting the going concern assessment."
PharmaZen has been in a trading halt since May 23.
Scott Simpson.
After just over a year as chair of ACC, Tracey Batten has resigned. Her resignation takes effect from June 11 and deputy chair David Hunt will be the interim chair.
Batten was first appointed to the ACC board in February 2019 and became chair in March last year. In a statement today ACC Minister Scott Simpson said he had accepted her resignation and thanked her for her service.
Simpson said ACC was confronting several challenging issues, including significant financial challenges and concerns about its overall performance. “In the coming months I will be making announcements about my turnaround plan for ACC,” he said.
Taupo-based milk processor Miraka has announced an opening milk price forecast for the 2025/26 season of $8.85-$10.85 a kg of milk solids.
The majority iwi-owned company said its mid-point price of $9.85 was "grounded in fundamentals".
“While others in the sector have announced a $10 headline price, it’s important to understand the full picture,” said acting CEO Richard Harding.
On Thursday Fonterra announced a forecast for next season of $10 a kg, within a range of $8-$11.
Miraka said its farmers could also earn a further 20c a kg through its Te Ara Miraka farming excellence programme.
Todd McClay.
Trade and Investment Minister Todd McClay heads to Europe this weekend to attend the annual OECD trade ministers meeting in Paris. He will also attend a meeting of the CPTPP ministerial group and a World Trade Organisation mini-ministerial meeting. In Switzerland he will meet ministers from the United Arab Emirates, Singapore, and Switzerland who, together with New Zealand, have formed a new trade group to focus on removing trade barriers and promoting paperless trade. Then, in Brussels, McClay will hold talks with the EU Commissioner for Trade, the Commissioner for Agriculture and Food, and the EU vice-president responsible for sustainability. “One in four jobs depend on trade and strong trade relationships mean more opportunities for New Zealanders,” he said.
