Stocks to watch: AFF, ANZ, BRG, FBU, NZR, NZX

Stocks to watch: AFF, ANZ, BRG, FBU, NZR, NZX, SKC

Aug. 18 (BusinessDesk) – The following stocks may be active on the New Zealand exchange after developments since the close of trading. All prices are in New Zealand dollars unless specified.

Themes of the day: Stocks in Europe and the U.S. rose on stronger-than-expected profits from retailers Wal-Mart Stores Inc. and Home Depot Inc. Shares were supported by mergers and acquisitions activity after BHP Billiton Ltd. made an unsolicited US$38.6 billion takeover bid for Potash Corp of Saskatchewan Inc. Fletcher Building Ltd., the biggest company on the NZX, said it was too early to give any meaningful guidance due to the uncertainty in the markets, and reported earnings near expectations.

Affco Holdings (AFF): The listed meat processor advised investors to reject a 37c a share takeover offer from South Island food producer, Tally’s Group. Last month Talley's signed a pre-bid agreement with the Spencer Family’s Toocooya Nominees Ltd. to buy its 23.5% stake in Affco for $43.86 million, taking its stake in the takeover target to 76.2 %. Affco shares were unchanged yesterday at 37 cents.

Australia & New Zealand Banking Group (ANZ): The Australian lender said yesterday it is participating in a due diligence process for the potential purchase of a 57.3% shareholding in Korea Exchange Bank. The stock rose 1.8% to $28.50 on the NZX yesterday.

Briscoe Group (BGR): The retailer was cut to ‘hold’ from ‘buy’ by Buffy Gill, an analyst at Goldman Sachs JB Were, according to ShareChat. The company’s 2% decline in same-store sales in the three months ended Aug. 1 was its first quarterly decline since early 2009. She revised her 12-month share price target down to $1.35 from $1.60 previously. The shares fell 2 cents yesterday to $1.12.

Fletcher Building Ltd. (FBU): The nation’s biggest company on the exchange reported a full-year profit of $272 million, turning around last year’s loss of $46 million from the write-down on its Formica unit, and said the degree of uncertainty in the market meant any quantitative earnings guidance would be “premature”. Stripping out one-off items, the building company reported earnings of $301 million, compared to $314 million a year ago. The shares fell 0.7% to $7.18 yesterday, a 12-month low.

New Zealand Refining Co. (NZR): The operator of New Zealand’s only oil refinery posted a 45% decline in interim profit to $29 million yesterday as revenue fell. The results, while lower that the year previous, came in ahead of forecasts. Its shares gained 6% to $3.18 yesterday.

NZX Ltd. (NZX): The local securities market operator turned in flat earnings of $5.7 million for the six months to June 30, once one-off gains from asset sales in the previous period are stripped out. Chief executive Mark Weldon pronounced the result “good”, being achieved in challenging capital market conditions while NZX was completing the foundations for its expansion into derivatives trading. The shares fell 2.1% to $1.41 yesterday, though the result was published after the close of trading.

Sky City Entertainment Group (SKC): New Zealand’s biggest casino operator posted a 12% drop in profit on weaker returns from its main Auckland base and the impact of tax changes and gave little in the way of an outlook statement yesterday. The stock fell 2.3% to $2.89.

(BusinessDesk)

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