Media release
18 October 2013
South Island firms achieving meteoric growth
Deloitte South Island Index sets another all-time high posting largest quarterly growth percentage since its inception
South Island listed companies have posted a meteoric 22.7% growth in the latest quarter according to the Deloitte South
Island Index released today. This is the largest quarterly growth percentage since the inception of the Index.
The 23rd edition of the Deloitte South Island Index, for the quarter to 30 September 2013, saw the index rocket upwards
by $1.6 billion (22.7%) in market capitalisation, continuing the trend of the previous four quarters. The latest
quarter’s results see the Index up $3.02 billion (53.6%) during the year to 30 September 2013 with total market
capitalisation now standing at $8.66 billion, yet another new high since its inception in 2007.
The South Island Index’ 22.7% growth led the way against benchmark indices during the September quarter. Over the same
period, the ASX All Ords achieved respectable growth of 9.3% while the NZX 50 Index and Dow Jones achieved more modest
to low growth of 6.7% and 1.5% respectively.
Paul Munro, a corporate finance partner in Deloitte’s Christchurch office, says the performance of the Index over the
last quarter has been nothing less than remarkable.
“In particular, the significant growth from EBOS Group after their strategic Australian acquisition clearly demonstrates
that South Island companies can successfully expand into overseas markets and compete in the current global economic
environment,” says Mr Munro.
“The quarter also saw the re-emergence of the Primary sector back into positive territory, a pleasing result given the
importance of this sector to the South Island economy. The principal architects of this revival were the dairy duo of
Synlait Farms and Synlait Milk, as investors scrambled to grab a share in the New Zealand dairy industry, with a helping
hand from PGG Wrightson’s recovery, seemly unfazed by the recent adverse weather conditions and Fonterra’s botulism
scare.”
The Index’s top performer for the quarter was EBOS Group, gaining a phenomenal $854.5 million in market capitalisation
or 135.8%. This follows the issuance of just over 81 million shares after finalising the acquisition of the Symbion
Group in July. On the day of the share issue, the market capitalisation of EBOS Group grew by $770.9 million – more
than doubling its size. This dramatic move by EBOS Group cements its position in second place on the Deloitte South
Island Index. EBOS Group’s share price also contributed to its growth over the quarter to 30 September 2013, increasing
by $0.52 (5.4%) per share.
Ryman Healthcare’s share price continued its climb, increasing another $0.58 (9.1%) during the quarter, growing its
market capitalisation by $290 million in the quarter to 30 September 2013. Kathmandu Holdings and newcomer to the Index
Synlait Milk both had strong quarters, gaining $154.2 million (30.4%) and $146.3 million (45.4%) in market
capitalisation respectively.
The biggest decline in the quarter came from Lyttelton Port, which lost $35.7 million in market capitalisation, a
decline of 12.3%, after having a stellar second quarter of the year. During the quarter the company announced its
annual results which noted the continual challenges that it faces regarding its earthquake insurance claims, now three
years old. Pacific Edge and Moa Group also lost ground shrinking by $15.9 million (9.7%) and $10.2 million (29.7%)
respectively in the quarter to 30 September 2013.
Six of the eight industry sectors posted positive movements in the quarter to 30 September 2013, led by the
Manufacturing & Distribution and Primary sectors which gained $912.5 million (92.1%) and $235 million (31.8%) respectively.
Manufacturing & Distribution sector growth was primarily on the back of EBOS Group’s more than doubling in size, although Skellerup
Holdings also had a positive result in the quarter to 30 September 2013, gaining $61.7 million (24.2%) in market
capitalisation.
The two sectors undergoing declines during the quarter were the Port and Biotechnology sectors, decreasing 7.1% and 8.0%
respectively.
To see the full Deloitte South Island Index quarterly report, go to www.deloitte.com/nz/southislandindex.
ENDS