Stocks to watch: F&P Appliances at record low, Infratil updates

Monday 23rd February 2009

The following stocks may be active on the New Zealand exchange after developments since the close of trading on Friday.

Themes of the day: Shares fell on Wall Street on Friday, driving the Dow Jones Industrial Average to a six-year low. The NZX 50 fell 1.5% to 2,576.68, the lowest in almost five years, on Friday. Crude oil and copper fell in New York on Friday, while gold rose to above US$1,000 a ounce for the first time in almost a year, amid increased fears government efforts worldwide aren't enough to lift the global economy out of a slump.

Fisher & Paykel Appliances (FPA): The shares fell 4.8% to a record low 59 cents on Friday amid continued speculation about plans to raise capital, which the manufacturer has flagged this without giving details. The NZX will investigate short-selling in the stock and the potential for insider trading, the Sunday-Star Times reported yesterday, without citing anyone.

Infratil (IFT): The investment group on Friday said demand for its Snapper debit card is growing, with almost 50,000 now on issue, accounting for 50% of Go Wellington's trips and being accepted at 120 retail terminals, mainly in Wellington. The shares jumped 4.1% to $1.79 on Friday.

Nuplex Industries (NPX): The maker of specialty chemicals and resins fell 3.3% to $1.45 on Friday, the second daily decline. The compant last week said it is in talks with its banks to loosen its senior debt cover ratio requirements, which it was in danger of breaching.

NZ Farming Systems (NZS): Shares of the South American dairy farm developer slumped 29% to a record low 40 cents on Friday, while PGG Wrightson (PGW), which has the contract to manage NZ Farming Systems, slumped 28% to 59 cents. The shares have slumped amid speculation they may require more capital as debt repayments loom. Wrightson also potentially faces costly litigation over its failed plan to buy half of Silver Fern Farms.

NZX (NZX): The stock exchange operator posted a 17% gain in full-year profit to $10.2 million as revenue from ordinary activity climbed 2.3% to $32.2 million. Chief executive Mark Weldon said NZX "has operated in an environment of de-leveraging, declining asset values, reduced listing activity in the face of volatility, and the reshaping of global financial institutions - yet a strong financial performance has still been achieved." The shares fell 10 cents to$5.60 on Friday.

Property for Industry (PFI): The investment group managed by AMP Capital Investors, posted a full-year net loss after lowering the value of its portfolio by 10%. The net loss was $31.9 million in 2008, from a profit of $44.5 million in 2007, the company said in a statement. The shares fell 1 cent to $1.11 on Friday and are down 13% in the past 12 months, less than half the decline of the NZX 50 Index.

ProvencoCadmus (PVO): The eftpos systems vendor last week said it would roll over its capital notes for a further 12 months, paying 2% interest, down from the 9.25% offered when first issued in 2006. Noteholders will be offered the option of converting the notes to ordinary shares. The shares tumbled 27% to 4 cents on Friday.

Sky City Entertainment (SKC): The Auckland-based casino and hotel operator posted a first-half profit of $55.6 million, excluding one-time items, down from $64.2 million a year earlier. The company will prune back its distribution payout ratio to 60% to 70% to retain capital to repay debt, it said. Sky City said it had a "relatively resilient performance from New Zealand operations in spite of challenging economic environment" and a solid performance in Australia. The shares fell 2 cents to $2.72 on Friday.

By Jonathan Underhill

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