MARKET CLOSE: NZ shares gain; a2 hits new record, F climbs on patent deal
By Paul McBeth
Feb. 21 (BusinessDesk) - New Zealand shares rose for a second day as a2 Milk reached a record following its strong
earnings yesterday and Fisher & Paykel Healthcare jumped on the end of a costly, long-running patent dispute.
The S/NZX 50 index climbed 51.37 points, or 0.6 percent, to 9,300.81. Within the index, 22 stocks rose, 22 fell, and six were
unchanged. Turnover was $177.5 million.
F Health led the market higher, rising 6.8 percent to $14.29 on volume of 1.4 million shares, more than twice its
average. The breathing mask maker settled a long-running dispute with rival ResMed across the US, UK, Europe, Australia
and New Zealand, having racked up millions of dollars in legal fees in the process. Both parties have now decided to
settle with no payment or admission of liability.
"Just the lawyers won with that particular battle - now sanity has prevailed which is good," said Grant Davies, an
investment adviser at Hamilton Hindin Greene.
A2 rose as high as $14.85, a new record, and ended the session up 4.2 percent at $14.82. Volume was bigger than usual at
2 million shares. The milk marketing firm beat earnings expectations yesterday and has resumed its place as the biggest
listed company on the NZX, with a market capitalisation of almost $10.9 billion.
Davies said several brokers upgraded their target prices for a2 after the result, although the revisions largely
reflected the share price.
Meridian Energy, the second-biggest listed company, rose 1.4 percent to $3.63 on an average volume of 1.3 million
shares. The electricity generator reported record earnings yesterday, although some investors were unnerved by weakness
at Meridian's Australian arm.
Auckland International Airport, the third-biggest listed company, increased 0.1 percent to $7.35, with 1.8 million
shares changing hands, almost twice its average volume. The airport operator reports earnings tomorrow and is expected
to respond to the Commerce Commission's concerns that it plans to overcharge customers for its major upgrade.
Pushpay climbed 4.3 percent to $3.43 on a smaller volume than usual of 161,000 shares. Vista Group International
increased 0.5 percent to $3.94, with 1.5 million shares traded, more than seven times its 90-day average of 210,000.
Spark New Zealand was the most traded stock with 9.4 million shares changing hands, compared to its 3.9 million 90-day
average. The stock fell 3.7 percent to $3.75, extending yesterday's decline. The company reported increased underlying
earnings yesterday as cost-cutting helped widen margins. Net profit fell without a dividend from Southern Cross.
Sky Network Television fell 2.4 percent to $1.64, a new record-low, on a volume of 591,000. The pay-TV operator posted
yet another slump in first-half earnings yesterday as it continues to shed customers and faces new competition in
premium sports from Spark.
Fletcher Building fell 1.6 percent to $4.90 on a volume of 3.2 million. Of other companies trading on volumes of more
than a million shares, Heartland Group rose 1.5 percent to $1.37, Air New Zealand fell 1.5 percent to $2.61, Z Energy
increased 1.8 percent to $6.09, and Precinct Properties New Zealand decreased 0.3 percent to $1.48.
Outside the benchmark index, TeamTalk rose 3.8 percent to 82 cents after affirming annual earnings will be in line with
the $4.4 million reported a year earlier. Dividends will also be back on the table at the end of the June financial
NZME was unchanged at 48.5 cents. Rival Stuff posted a 23 percent slide in first-half earnings, outpacing a decline in
revenue, with owner Nine Entertainment Co looking to sell the New Zealand news group.
Of firms reporting tomorrow, New Zealand Refining was unchanged at $2.26, Summerset fell 1 percent to $6.28, Cavalier
was unchanged at 51 cents, Delegat Group rose 0.4 percent to $9.55, and Michael Hill International was unchanged at 56