MARKET CLOSE: NZ shares gain; Ebos, Sky TV rise

MARKET CLOSE: NZ shares gain; Ebos rises on asset sale, Sky Network climbs

August 5 (BusinessDesk) – New Zealand shares rose, lifting the NZX 50 Index for the sixth time in seven sessions, after Ebos Group announced the sale of its science units, allowing it to repay debt, and as Sky Network Television reached a three-month high.

The NZX 50 gained 6.53, or 0.2%, to 3044.66. Within the index, 19 stocks rose, 19 fell and 12 were unchanged. Turnover was $55.4 million.

Ebos, the medical supplies distributor, rose 4.2% to a record close of $6.70, bringing its gain in the past 12 months to 20%. The company announced today it will sell its trans-Tasman science businesses to American firm VWR International, allowing it to erase all of its debt.

“The transaction will be value-positive for Ebos shareholders both in terms of a gain on sale from the transaction and the resultant cash flow,” it said.

Sky TV rose 3.3% to $5.05. The nation’s biggest pay-TV company is expected to post a 10.5% gain in reported earnings, according to Forsyth Barr, which rates the shares a buy. Its outlook is positive given the defense nature of its earnings.

Rakon Ltd. gained 3.8% to $1.10 as the kiwi dollar tumbled following a weaker-than-expected employment report for the second quarter. The jobless rate jumped to 6.8%. A weaker dollar helps boost the value of overseas revenue when it is brought home. Nuplex Industries rose 1.3% to $3.04.

The kiwi dollar traded recently at 72.95 U.S. cents from about 73.50 cents immediately before the jobs data was released.

Vector Ltd. climbed 1.9% to $2.10.

Kathmandu, the outdoor equipment retailer, fell 3.3% to $1.76, adding to yesterday’s 12% slump after it said gross margins fell short of last year’s forecast at 63%, which is below both the 64.4% result in the previous year and 64% prospectus figure.

Among other retailers, Michael Hill International declined 2.9% to 66 cents and Pumpkin Patch dropped 3.4% to $1.71.

NZ Farming Systems Uruguay, which is awaiting a firm takeover offer from Olam International, fell 3.5% to 55 cents. Fonterra, the world’s largest dairy exporter, said yesterday it may have to reduce its forecast payment to farmers because of weakening in global dairy prices and the strength of the New Zealand dollar. Olam has said it will offer 55 cents a share for the rest of Farming Systems.

Telecom Corp. rose 0.5% to $2.02 after Standard & Poor’s put the company on CreditWatch Negative, giving it a one-in-two chance of a downgrade over the next three months. The company has proposed separating its lines and retail businesses to participate in the government’s high-speed broadband rollout.

Guinness Peat Group, which has proposed spinning off its Australian business, fell about 3% to 65 cents.

(BusinessDesk)

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