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Stocks to watch: Pike River Coal, Rakon, Sky City , A2 Corp., SPT, WHS

Monday 24th May 2010

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Pike River Coal shares climb as it reports that it has completed its $90 million capital raising.  Rakon reins in full-year loss on pick-up in demand for GPS and Sky City Entertainment sells its 50% stake in Vista Entertainment Solutions. 

 

Pike River Coal (NZX: PRC ): The coal mine developer said on Friday it had completed its $90 million capital raising. Of the pro rata rights issue of $40 million, 72% of Pike’s shareholders took up their entitlements, leaving underwriters led by UBS and the McDouall Stuart Group to pick up the balance. The shares climbed 1.9% to $1.05 on Friday.

Rakon  (NZX: RAK ): The manufacturer of crystal oscillators used in navigation systems and mobile phones, reported on Friday a full-year net loss of $5.4 million, from a $4.5 million profit a year earlier but said it had turned around its performance in the second half, eking out earnings of $800,000 after a first-half loss of $6.2 million. The shares fell 3 cents to 97 cents on Friday.

Sky City Entertainment Group  (NZX: SKC ): The casino and hotel group sold its 50% stake in Vista Entertainment Solutions, a developer and supplier of cinema management software, to the venture’s managers. No price was disclosed. Sky is exiting its cinema interests. The shares fell 1 cents to $2.92 yesterday.

A2 Corp. (NZX: ATM ): The developer of milk products claimed to have health benefits said it will acquire the 50% of a joint venture with Freedom Nutritional Products, gaining exclusive rights to market the products in Australia and Japan.  A2 Corp. will pay for the half stake via the issue of 120.4 million ordinary shares, or 25% of A2 Corp. The shares fell to 8.5 cents from 8.6 cents on Friday.

Spotless Group  (NZX: SPT ): The laundry services group said on Friday that early signs of demand recovery noted in its interim results “have not been sustained in March and April” with some areas of business softening further. Net income this year will exceed earnings in 2009, mainly reflecting lower interest costs after it paid down debt by raising equity. The shares fell 5.2% to A$2.35 on the ASX on Friday.

Warehouse Group  (NZX: WHS ): The retailer is rated ‘neutral’ by First NZ Capital analyst Sarndra Urlich, according to the ShareChat website. The company’s 1.9% decline in third-quarter sales was very disappointing and it was “somewhat frustrating” to see sales weaken as the economy is pulling out of recession. She said Warehouse is expensive relative to its peers from an earnings multiple perspective though with potential for Australia’s Woolworths to lift its stake, the stock may not fall too far. The shares were unchanged on Friday at $3.60. 

 

Economic themes of the day: Shares rose on Wall Street on Friday, capping a plunging week, as banks rebounded after the US Senate approved a bill toughening up financial regulations, which gave lenders more certainty about their future.

The kiwi dollar rose to 67.90 US cents, climbing after its biggest weekly decline since October last year.

German legislators agreed to its share of the 1 trillion euro package to shore up the region's financial stability and bail-out Greece from its debt woes.

 

 

 

 

Businesswire.co.nz



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