Drugmaker rewarded for strong results
The New Zealand sharemarket opened the new week on a solid note, albeit on light trading, and companies reporting strong results are being rewarded. The recipient this time was AFT Pharmaceuticals.
The S&P/NZX 50 Index rose steadily in the morning, then drifted off as news filtered through of an increase in Covid cases in Beijing. The index finished 49.06 points or 0.44 per cent ahead at 11,316.46 after reaching an intraday high of 11,370.25.
There were 63 gainers and 72 decliners on the main board, with 26.55 million shares worth $93.65 million changing hands.
AFT Pharmaceuticals surged 44c or 13.71 per cent to $3.65 after reporting 155 per cent rise in net profit to $19.8m on revenue of $130.3m, up 15.2 per cent for the year ending March. AFT’s operating profit was $20.4m and is forecasting $27m-$32m for the 2023 financial year. Its Maxigesic pain relief medicine is now sold in 46 countries.
Jeremy Sullivan, investment adviser with Hamilton Hindin Greene, said there were some decent results coming through in the latest reporting season though the concerns of inflation and rising interest rates remain.
Fletcher Building reached a 17-month low after falling 5c to $5.70. “There are a lot of houses to be built, and inflation and logistics must be weighing on Fletcher,” said Sullivan.
The a2 Milk Company rose 16c or 3.38 per cent to $4.89 after receiving a broker upgrade from sell to neutral and suddenly having the opportunity of increasing infant formula sales in the United States market, which is facing a nationwide shortage.
Sullivan said the Food and Drug Administration has lowered the bar for other competitors to come in, and it may be easier to get a foothold in the US market, even if it’s short-term.
Synlait, which processes a2 Milk products, increased 10c or 3.14 per cent to $3.28. Skellerup Holdings, under pressure lately from selling by a local institutional investor, rebounded 19c or 3.62 per cent to $5.44.
Mainfreight increased $1.86 or 2.48 per cent to $76.96; Pushpay Holdings rose 4c or 3.33 per cent to $1.24; Eroad rose 15c or 5.58 per cent to $2.83; and Accordant Group was up 5c or 2.42 per cent to $2.12.l
Marsden Maritime Holdings gained 11c or 1.88 per cent to $5.95; Green Cross Health rose 6c or 4.88 per cent to $1.29; and Burger Fuel gained 1.5c or 5.71 per cent to 30.5c. Energy companies Meridian was up 10c or 2.22 per cent to $4.60; Contact gained 11c to $7.79; and Mercury increased 7c to $5.83. Genesis Energy was up 1c at $2.71. Kiwi Property was up 3.5c or 3.45 per cent to $1.05 after reporting 14.1 per cent increase in net profit to $224.27m and 5.5 per cent increase in revenue to $246.82m for the year ending March.
There was a $120.5m revaluation gain to its $3.6 billion portfolio. Kiwi is paying a final dividend of 2.85c a share on June 22. Stride Property increased 3c to $1.73; Precinct Properties was up 3.5c or 2.57 per cent to $1.395; and Argosy gained 3c or 2.39 per cent to $1.285.
Tourism Holdings increased 6c or 2.17 per cent to $2.83 after narrowing its full-year guidance to a net loss of $2m-$4m. The company is seeing increased demand for recreational vehicle travel in United States, Australia and New Zealand. It is looking at the possibility of selling off a subsidiary, Kiwi Experience.