Stocks to watch: AIR, ALF, DGL, ECO, NZS, PRC

Stocks to watch: AIR, ALF, DGL, ECO, NZS, PRC

Sept. 13 (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: Australian Prime Minister Julia Gillard has announced her new Cabinet, installing Kevin Rudd, whose speaks Mandarin, as foreign minister and Penny Wong in charge of the finance portfolio. Reserve Bank Governor Alan Bollard is expected to keep the official cash rate at 4% when he reviews policy on Thursday. The New Zealand dollar opened the week stronger, breaking through the 73 cents mark to trade at U.S. 73.17 cents, up from U.S.72.46 cents on Friday.

Air New Zealand Ltd. (AIR): The national carrier’s plan to form an operating alliance with Virgin Blue on the Tasman routes was knocked back by Australia’s antitrust regulator, which said such a merger would boost the likelihood of “coordinated conduct on routes”. The stock rose 0.8% to $1.27 on Friday.

Allied Farmers Ltd. (ALF): The finance group, which lost its main finance unit to receivership, reported on Friday that its annual loss more than doubled including a one-time charge $40.1 million hit on the failed finance business and a further write-off of $20.2 million on the distressed Hanover and United loan books. The stock climbed 26% to 3.4 cents on Friday, when the firm announced the early sale of the Five Mile development.

Delegat's Group (DGL): The wine maker is expected to face pressure on net earnings in the next year on speculation that the New Zealand dollar will trade stronger against the US and Australian currencies, according to Goldman Sachs JB Were analyst Adrian Allbon, quoted on the ShareChat website. The shares rose 2.3% on Friday to $1.75.

Ecoya Ltd. (ECO): The scented candle company has acquired cosmetics firm Trilogy, based in Wellington, for $10 million, with a potential further $10 million earnout in cash and shares. The shares last traded on Sept. 7 at 80 cents.

NZ Farming Systems Uruguay (NZS): The company has named former Fonterra executive Alastair de Raadt to lead it through the internalisation of its management contract as chief executive until the end of January, with the option to extend it by mutual agreement. The shares rose 1.5% on Friday to 70 cents.

Pike River Coal (PRC): Chief executive Gordon Ward is to leave the company next month, having been with the company since the development concept for the mine 14 years ago. The shares sank 3.6% to $1.06 on Friday.

(BusinessDesk)

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