Warehouse, Mercury lead way as New Zealand stocks retreat

New Zealand shares fell, with Warehouse Group and Mercury New Zealand ending down, while Air New Zealand rose.

The S& P/ NZX50 Index dropped 30.93 points, or 0.4 per cent, to 7058.59. Within the index, 23 stocks fell, 14 were unchanged and 13 rose. Turnover was $ 127.5 million.

Warehouse Group led the index lower, down 2.6 per cent to $ 2.59. On Thursday, the retailer said it expected to shed a net 130 jobs, or about 1.1 per cent of its workforce, in an effort to save up to $ 20m a year after slimming down the structure of its retail model to try to strip out duplication.

Mercury New Zealand dropped 2.6 per cent to $ 3.05, while Trade Me Group fell 2.4 per cent to $ 4.92.

Metro Performance Glass fell 2.2 per cent to $ 1.36, while Fletcher Building fell 1 per cent to $ 9.70. Fletcher dropped 5.2 per cent on Wednesday after posting a 2 per cent gain in first- half profit that included unexpectedly weak earnings from its construction division, especially given its $ 2.7 billion backlog of work.

“It’s [ Metro Performance Glass] looking a bit underwhelming, it’s had a rough few months — it was trading as high as $ 2.20 back in September/ October, and it’s fallen by close to $ 1,” said Mark Lister, head of private wealth research at Craigs Investment Partners.

Vector dipped 0.3 per cent to $ 3.24. The Auckland- based electricity and gas distributor posted a 7 per cent gain in first- half profit to $ 107m, driven by stronger sales, lower finance costs and a one- time gain after a Court of Appeal ruling on a tax claim. Sales rose to $ 626m from $ 591m.

Vista Group International was unchanged at $ 5.40. The cinema analytics software developer will pay a bigger maiden dividend than analysts were picking after profit was bolstered by a gain on its Chinese joint venture and as underlying earnings increased 17 per cent.

Air New Zealand was the best performer in the index, up 1.3 per cent to $ 2.28, while Spark New Zealand gained 1 per cent to $ 3.565 and Skycity Entertainment Group rose 1 per cent to $ 4.09.

Outside the benchmark index, CBL Corp dropped 11 per cent to $ 3.30. Full- year profit was $ 30.7m, falling short of the $ 40.4m forecast in its prospectus, reflecting one- time costs including a foreign exchange adjustment, while operating earnings of $ 76.2m exceeded its prospectus forecast of $ 63.6m.