MARKET CLOSE: Retailers Hallenstein, Briscoes and Kathmandu drive market

Friday 6th August 2010

New Zealand shares were mixed, with retailers dominant. Hallenstein Glasson led gainers after saying margin recovery lifted its annual earnings. Kathmandu sank to a record low after disappointing margins.

The NZX 50 fell 0.04 to 3044.632. Within the index, 20 stocks fell, 13 rose and 17 were unchanged.

Hallenstein (NZX: HLG ) rose 6.1% to $3.82 after the clothing retailer said full-year profit soared as much as 57% to $28.8 million, as it eased off on discounting, improved its product range and benefited from a strong kiwi dollar. Sales in the 12 months ended August 1 rose 4.5% to $207 million.

“They have been able to buy their produce reasonably well and managed the currency reasonably well,” Milford Asset Management equities manager Alan Moore says. “They are in the market at the cheaper end so their volumes have been reasonable good.”

Kathmandu (NZX: KMD ) dropped 4.6% to $1.68, the lowest since the outdoor equipment retailer first listed in November after it was taken public by its private equity owners. The retailer’s stock has fallen for three sessions since it said its gross margin was 63%, falling short of the forecast 64% in its prospectus.

Fisher & Paykel Healthcare (NZX: FPH ) fell 1% to $2.90 after its rival Resmed posted a satisfactory result but was punished with its stock sold off.

Moore said there’s still uncertainty about the outcome of changes to medical funding in the U.S. that has weighed in the sector.

Allied Farmers (NZX: ALF ) climbed 9.8% to 4.5 cents. The finance and agricultural services group is planning to tap investors for $19.3 million of equity capital to strengthen its balance sheet and repay debt. Guardian Trust, the trustee for its Allied Nationwide Finance unit, said today that the finance business is in breach of one of its trust deed financial ratios.

Allied, which denies the breach and is finalising the audit of its accounts, has 14 days to remedy its position. It has suspended its prospectus in the interim.

Briscoe Group (NZX: BRG ) fell 0.8% to $1.19 after the retailer said a decline in homeware sales dented revenue in the second quarter. Sales fell 1.9% to $93.3 million in the three months ended Aug. 1, led by a 3.6% decline in homeware goods, the company said in a statement today. Sales at Rebel Sport rose 2.2%.

The company reiterated that it is on track for earnings growth in the first half.

Businesswire.co.nz

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