In the United States, new data showed job openings fell by less than was expected. Photo / Gabriela Bhaskar, The New York Times
Keeping you up to date with the latest market moves, in association with Investment firm Jarden.
International
US
The US Labor Department’s Job Openings and Labor Turnover Survey (Jolts) report showed that job openings fell less than expected in January, with data for the previous month revised higher.
However, the report also highlighted that layoffs rose in January, job cuts were higher than initially estimated in 2022, and fewer people voluntarily quit their jobs.
The labour market remained strong, with 1.9 job openings per unemployed worker in January. However, economists believe the Jolts report shows some cracks forming in the labour market, which may keep the Federal Reserve on track to raise interest rates for longer.
Campbell Soup Company’s shares rose significantly after reporting second-quarter earnings of US$0.80 per share, beating analysts’ estimates of US$0.74, with revenues of US$2.49 billion (NZ$4.08b), exceeding expectations of US$2.43 billion.
The increase was driven by favourable net price realisation, which led to a 12 per cent increase in net sales and a 13 per cent increase in organic net sales.
Campbell Soup also raised its full-year outlook for net sales growth to 8.5 - 10 per cent, up from a previous forecast of 7 - 9 per cent. Although some analysts believe the results were not surprising, Stifel analysts expect the shares to rise slightly due to the better quarter and increased outlook.
Rest of World
The Restaurant Group (TRG) plans to shut down 35 of its underperforming sites and increase its operating margins from 8.3 to 11.8 per cent over the next three years, amid pressure from activist investors.
TRG CEO Andy Hornby denied that the move was a concession to Oasis Management, a hedge fund that owns a 6.5 per cent stake in the British firm.
Irenic Capital Management has also built a position in TRG. Shares in the company fell by 15 per cent after it dismissed rumours of an immediate asset sale. Most closures will affect Frankie & Benny’s and Chiquito chains.
Singapore-based company Sea has reported its first quarterly profit after implementing cost-cutting measures to offset a pandemic-related drop in demand.
The company’s Q4 2022 marketing and sales expenses fell by 61 per cent, reducing operating expenses to SG$1.35 billion (NZ$1.63b).
CEO Forrest Li said the company had exited or downsized non-core operations, streamlined investments and deprioritised non-core initiatives.
Net income attributable to shareholders was SG$426.8 million, compared with a loss of SG$617.6 million in Q4 2021.
Sea’s market capitalisation dropped to SG$37 billion after shares fell by over 75 per cent in 2021.
Commodities
The US shale oil industry, which has made the country the world’s largest oil producer over the past decade, is losing steam, and companies are finding fewer big oil wells in America’s busiest oil patch, the Permian Basin.
The biggest and best wells are producing less oil, and the atrophy of once-booming sweet spots has significant implications for the global oil market, which could count on US oil production to counter supply disruptions and rising demand.
Industry executives warn that without successful exploration or technological advances, the industry’s inventory constraints are expected to push companies to tap lower quality wells that would require higher oil prices to attract investment.
Australia
Carsales.com Ltd has signed an agreement to acquire an additional 40 per cent of the leading automotive digital marketplace in Brazil, Webmotors S.A. for 1.24 billion Brazilian Real (NZ$395 million), making Carsales.com a 70 per cent majority owner.
This equity change is expected to allow Webmotors to benefit further from Carsales’ expertise in digital marketing, customer experience, and product and services within the digital automotive ecosystem.
Webmotors will retain the support of Santander, the auto loans market leader in Brazil. To fund the acquisition, Carsales.com will raise AUD500m in equity. The acquisition is expected to be completed in Q4 FY23.
New Zealand
Pushpay Holdings Limited has amended its scheme implementation agreement (SIA) with Pegasus Bidco Limited, which involves the acquisition of Pushpay’s shares for NZ$1.34 in cash per share.
The resolution to approve the scheme of arrangement was not passed by shareholders at the meeting held on March 3, 2023.
The bidder requested an extension to explore the possibility of an alternative proposal, and the termination time has been extended to March 13, 2023, to allow the bidder further time to progress the terms of a potential alternative proposal.
If the parties have not reached an agreement on holding another Scheme Meeting by then, either party can terminate the SIA.
There is no certainty that an alternative proposal or transaction will result from the bidder’s engagement with select shareholders and the company.
The consortium already had a 20.3 per cent interest in Pushpay, but the offer failed to meet the required 75.0 per cent threshold of shareholders not associated with the takeover voting in its favour.
The independent adviser’s valuation of Pushpay shares was between NZ$1.33 and NZ$1.53, indicating that the offer was at the bottom of the range. The new deadline for the consortium to come up with an alternative proposal or transaction is March 13.
Ryman Healthcare’s retail entitlement offer has closed, with eligible shareholders subscribing to 47 million new shares, raising approximately $237 million.
The participation rate was around 66 per cent, and oversubscriptions were received for an additional $14 million. The remaining entitlements not taken up by eligible retail shareholders and entitlements of ineligible retail shareholders will be offered for sale in the retail bookbuild.
The bookbuild price per new share will be equal to or above the offer price of $5.00, and any premium will be paid to eligible and ineligible retail shareholders.
The settlement date for the new shares is Tuesday, March 14, and they will rank equally with Ryman’s existing ordinary shares. Prior to the closing of the retail component, Ryman successfully completed the institutional component of the offer on February 17, 2023, which raised $542 million (subject to final reconciliation of institutional entitlements).
Coming up today
There is no scheduled news today for the NZX main board or the ASX main board. This morning, the ANZ Truckometer for February will be released.
This is an economic indicator derived from traffic volume data. Additionally, Statistics New Zealand will publish electronic card spend data.
For more information on the latest market moves, get in touch with Jarden.
The Jarden Brief is provided for general information purposes only. It reflects views and research available at the time of publication, using external sources, systems and other data and information we believe to be accurate, complete and reliable at the time of preparation. We make no representation or warranty as to the accuracy, correctness and completeness of that information, and will not be liable or responsible for any error or omission. The Jarden Brief is not to be relied upon as a basis for making any investment decision. Please seek specific investment advice before making any investment decision. Jarden Securities Limited is an NZX Firm. A financial advice disclosure statement is available free of charge at https://www.jarden.co.nz/our-services/wealth-management/financial-advice-provider-disclosure-statement/.
Full disclaimer available at: https://www.jarden.co.nz/wealth-sales-and-research-disclaimer
All market pricing and announcements are sourced from Refinitiv, NZX and ASX.
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