MARKET CLOSE: NZ growth stocks fall as investors raise cash for Genesis; Pacific Edge, Xero drop
By Suze Metherell
April 1 (BusinessDesk) – New Zealand shares fell as investors took the opportunity to take profit from high-growth
stocks to raise cash ahead of the government’s public listing of Genesis Energy. Pacific Edge, Diligent Board Members
Services, A2 Corp and Xero declined.
The NZX 50 Index fell 17.463 points, or 0.3 percent, to 5122.519. Within the index, 29 stocks fell, 11 rose and 10 were
unchanged. Turnover was $115.7 million.
Investors sold shares to make room in their portfolios for the partial privatisation of Genesis, of which 40 percent has
been set aside for institutional investors, and which is being touted for its relatively high dividend yield.
Pacific Edge dropped 5.9 percent to $1.27. The maker of a non-invasive bladder cancer test has gained 103 percent in the
past 12 months. A2 Corp, the milk marketing company, fell 2.2 percent to 89 cents, having advanced 55 percent in the
past year.
Xero, the cloud-based accounting software firm, slipped 0.5 percent to $39.15, trimming a 900 percent in the past 24
months. Diligent, the governance app company, declined 1.2 percent to $4.10 after a two-year, 24 percent gain.
“The main reason for the weakness is investors selling stock in order to raise funds for the Genesis Energy issue in
which there has been a lot of interest and looks to be a successful float,” said Grant Williamson, broker at Hamilton
Hindin Greene “The very high growth sector has come under pressure overseas, and we’ve seen that in both Xero and
Pacific Edge, both those stocks are starting to weaken a bit.”
“Some of the stocks that have performed incredibly well over the last 12 to 18 months investors are deciding to take
profits from and that is certainly putting pressure on the share prices,” he said.
Outside the benchmark index Wynyard Group slid 2.7 percent to $2.85. The security software firm has climbed 157 percent
in the past 12 months.
Melbourne-based gold miner OceanaGold led the index lower, falling 7.1 percent to $2.37.
Michael Hill International declined 0.7 percent to $1.35. The Brisbane-based jeweller which bears the name of its
founder reached an A$6 million settlement with the Australian Tax Office over its 2008 transfer of intellectual property
to its Australian subsidiary.
Property stocks, which typically offer a high dividend yield, paced the day’s decline with the Reserve Bank’s move to
higher interest rates detracting from their appeal.
Precinct Properties fell 1 percent to 99 cents. DNZ Property Funds lost 0.7 percent to $1.525, while Argosy Property
slid 0.6 percent to 90.5 cents. Kiwi Income Property Trust slipped 0.5 percent to $1.11 and Goodman Property Trust was
unchanged at 96 cents.
Telecom fell 0.4 percent to $2.43. Fletcher Building, New Zealand’s largest listed company, dropped 0.4 to $9.48.
Among the day’s few gainers, Auckland lines company Vector advanced 1.7 percent to $2.47. Outdoor goods retailer
Kathmandu Holdings rose 1.3 percent to $3.90 and network provider Chorus lifted 1.2 percent to $1.735. Auckland
International Airport rose 0.9 percent to $3.845.
(BusinessDesk)