MARKET CLOSE NZ shares snap 2-day slide as Kathmandu result cheered, Sky TV gains

New Zealand shares snapped a two-day slide after Kathmandu delivered record earnings and Sky Network Television rose in continued heavier-than-average trading. Fletcher Building rose after falling from a five-year high reached last week.

The NZX 50 Index, which touched a record high last week, rose 9.213 points, or 0.2 percent, to 4710.587 Within the index, 16 stocks rose, 24 rose and 10 were unchanged. Turnover was $111 million.

The NZX 50 has climbed about 16 percent this year, as low interest rates across much of the developed world spurs investor demand for better returns.

“Markets with higher dividend yield and lower volatility are demanding a premium at the moment,” said Mark Warminger, portfolio manager at Milford Asset Management. “We’re expecting earnings upgrades in the next six-to-12 months as economic growth comes through. I’m still very positive on equities.”

Kathmandu soared 12 percent to a record-high close of $3.18 and reached an all-time high $3.22 in intraday trading after the outdoor equipment and clothing retailer posted record annual earnings and gave an upbeat outlook, reassuring investors after a year of changeable weather.

“If you look at the weather we’ve had over the last few months, there have been encouraging periods and very disappointing periods,” Warminger said. “There were some expectations the results could have been a little bit light.”

Fletcher rose 2 percent to $9.70, bringing its gain this year to 13 percent. Sky TV rose 2.5 percent to $5.70 and was the most heavily traded stock by value for a second day, with turnover of $18.9 million. Nuplex Industries rose 2 percent to $3.55 and Ryman Healthcare gained 1.3 percent to $$7.04.

Synlait Milk fell 0.9 percent to $3.27 after the Canterbury-based dairy processor that went public in July, posted a 161 percent jump in full-year profit, beating its prospectus forecast, although infant formula sales missed its target.

The prospectus forecasts were conservative, Warminger said.

Units in the Fonterra Shareholders’ Fund fell 0.8 percent to $7.21 after the dairy company hiked its forecast payout to farmers for the 2014 season by 50 cents to $8.50 per kilogram of milk solids, and held its estimated dividend at 32 cents per share, despite warning first-half earnings will be “significantly lower” than a year earlier. The guidance comes a day before Fonterra announces its 2013 result, which is expected to show earnings before interest, tax and one-time items of about $1 billion in the year ended July 31.

Trilogy International was unchanged at 69 cents after the skincare products and scented candle maker said its first-half loss will probably be $514,000 in the six months ending Sept. 30, down from a loss of $782,000 a year earlier.


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