Sunday, 20 Jun 2021

Market close: Sharemarket in punishing mood despite decent company results

The New Zealand sharemarket was in a punishing mood. My Food Bag, Ryman Healthcare and fellow retirement village operator Oceania Healthcare produced decent annual results but their share prices went backwards.

Instead it was left to the longtime market darlings Fisher and Paykel Healthcare and a2 Milk to keep the market steady. The S&P/NZX 50 Index edged ahead 22.44 points or 0.18 per cent to 12,459.61 after reaching a lunchtime high of 12,528.31

A total of 76.98 million shares worth $257.9 million changed hands, and there were 92 gainers and 48 decliners over the whole market.

The volume was boosted by the late trade of 31.12m shares worth $101.76m as Foodstuffs sold its 9 per cent stake in The Warehouse Group. It’s understood the shareholding changed hands at a discounted price just above $3.20.

Fisher and Paykel Healthcare gained 68c or 2.05 per cent to $33.80; Ebos Group climbed 89c or 2.97 per cent to $32.90; and a2 Milk staged a recovery, rising 37c or 6.54 per cent to $6.03. Synlait Milk was also up 4c to $3.10.

Shane Solly, portfolio manager with Harbour Asset Management, said latest online data had shown prices for some of a2 Milk’s products had risen on the Chinese e-commerce platforms. The fear was that a2 Milk’s volumes and prices were both declining.

Solly said it was a busy day for company results and the market took a breather to digest the information. There was plenty of detail to look through.

“Maybe Ryman and Oceania didn’t quite meet people’s expectations, even though they’ve done a good job during tough times. They have been quite solid and robust in the New Zealand economy, and produced sound results.

“But as you’ve seen on the US market and now here, if a stock even has a slight miss on expectation then it can be harshly dealt to,” Solly said.

“My Food Bag was in line with expectation and maybe people have been waiting for more optimistic announcements. But the company has been constrained in what it can say coming out of the period following its initial public offer.”

Ryman Healthcare fell 51c or 3.54 per cent to $13.88, and Oceania Healthcare was down 2c to $1.33. Fellow retirement village operator Summerset Group Holdings went down in sympathy, declining 12c to $12.51.

My Food Bag lost 7c or 4.7 per cent to $1.42, back to its lowest level since listing at $1.85. The meal kit company reaffirmed its 2022 forecast, provided at the time of its initial public offer, of $186.4m revenue, $34.2m operating earnings (ebitda) and $20.1m net profit.

My Food Bag increased revenue 24.4 per cent to $190.71m and ebitda 78 per cent to $29m for the 2021 financial year ending March. My Food Bag has 66,492 customers and delivered 4.8m meals, up 22.6 per cent on the previous year. It is expecting to pay its first dividend in December.

Ryman Healthcare increased its revenue 7.2 per cent to $452.41m and net profit 59.8 per cent to $423.06m for the year ending March. It had a $416.84m revaluation gain on its properties which are now valued at $9.17 billion, a 19.5 per cent increase. Its chief executive Gordon MacLeod is stepping down after 15 years with the company, and Ryman is paying a final dividend of 13.6c a share on June 18.

Oceania Healthcare had revenue of $175.4m, increased operating earnings (ebitda) of 56.2m, and net profit of $85.55m for the 10 months ending March. Its sales volume was ahead 26 per cent and it is paying a final dividend of 2.1c a share on June 22.

Auckland International Airport fell 10c to $7.45; Meridian was down 12c or 2.26 per cent to $5.20; Freightways declined 10c to $11.30; Port of Tauranga decreased 11c to $7.20; Kathmandu Holdings shed 5c or 3.16 per cent to $1.53; and Turners Automotive lost 5c to $3.62.

Automation and robotics solutions provider, Scott Technology, rose 18c or 7.76 per cent to $2.50 after telling the market it is winning contracts on increased international interest, including deferred projects involving with Whirlpool and Belgium snack food company, Poco Loco.

Metro Performance Glass gained 2c or 5.13 per cent to 41c after turning around a loss of $78.9m to a statutory net profit of $8.5m for the year ending March.

Comvita continued a good run, rising 16c or 4.86 per cent to $3.45; Plexure Group was up 3c or 4.62 per cent to 68c; and Private Land and Property Fund rose 7c or 6.67 per cent to $1.12.

Precinct Properties told the market it has completed a $15m six-year green bond offer that included $50m oversubscriptions, and its share price edged ahead 0.05c to $1.625. Property for Industry was down 4c to $2.82.

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