Market close: Tourism Holdings and SkyCity shares surge

Tourism Holdings surged 20c or 5.06 per cent to a near four-year high of $4.15 after significantly increasing its earnings guidance. Photo / Christian Heeb

Ryman Healthcare is making a near $1 billion capital raise and SkyCity is bouncing back to normal trading as the New Zealand sharemarket finished flat for the second day running.

The S&P/NZX 50 Index reached a lunchtime high of 12,105.15 but fell away and closed at 12,083.12, up 8.64 points or 0.07 per cent.

There were 68 gainers and 60 decliners over the whole market on volume of 67.15 million share transactions worth $172.07 million. The trading was dominated by Pushpay, which is being taken over, with 32.22 million shares worth $42.06m changing hands.

There were few leads from a mixed day on Wall Street after the January United States consumer price index was slightly higher than expected, with annual inflation running at 6.4 per cent. Economists were predicting 6.2 per cent.

The six-month US Treasury bond yield closed at 5.022 per cent, above the 5 per cent mark for the first time since July 2007.

At home, casino and hotel operator SkyCity Entertainment rose 12c or 4.9 per cent to $2.57 after reporting a return to pre-Covid trading with a 59.6 per cent increase in revenue to $462.6m and a 167.8 per cent rise in net profit to $22.8m for the six months ending December. The Auckland operation makes up 58 per cent of the revenue.

SkyCity’s operating earnings (ebitda) were up 421 per cent to $106.3m and it is paying an interim dividend of 6c a share on March 6.

Ryman Healthcare, which has 45 retirement villages in New Zealand and Australia for 13,000 residents, went into a trading halt till Monday after announcing a $902m capital raise to reduce its debt level to 33.9 per cent and strengthen the balance sheet after investing $3.9 billion since 2018.

Ryman is offering shareholders one new share for every 2.81 held at a discounted price of $5 per share. Ryman last traded at $6.40 and the retail offer opens on February 21 and closes March 6.

Jeremy Sullivan, investment adviser with Hamilton Hindin Greene, said Ryman’s capital raise is one of the five biggest in New Zealand corporate history and it will be good for them to get the monkey (debt) off their back.

“The discounted share offer is quite generous and it will be interesting to see whether shareholders arbitrage the $5 new shares and start selling them. But Ryman’s long-term prospects are now looking healthier,” he said.

Fellow retirement village operators Summerset Group was down 25c or 2.63 per cent to $9.25, and Oceania Healthcare declined 1c to 86c in the wake of the Ryman move.

Tourism Holdings surged 20c or 5.06 per cent to a near four-year high of $4.15 after significantly increasing its earnings guidance following the merger with Australian Apollo Tourism and Leisure. Tourism Holdings’ share price peak was $6.58 on June 1, 2018.

Now, Tourism Holdings expects its full-year net profit to be above $75m including $27m from Apollo for five months trading to the end of November. Tourism Holdings had earlier provided a guidance of more than $30m.

Auckland International Airport was up 13c to $8.66; Mainfreight collected 49c to $76; Vulcan Steel rebounded 35c or 4.09 per cent to $8.90; Hallenstein Glasson added 14c or 2.63 per cent to $5.47; and Green Cross Health increased 5c or 3.82 per cent to $1.36.

Property stocks Goodman Trust added 4c or 1.93 to $2.11; Precinct was up 2.5c or 1.95 per cent to $1.305; and Property for Industry increased 4.5c or 1.95 per cent to $2.25.

In the energy sector, Meridian was up 9c to $5.45; Mercury gained 7c to $6.40; Contact was down 6c to $7.66; Manawa declined 7c to $5.18; and Vector shed 5c to $4.27.

Fletcher Building, up 2c to $5.07, confirmed its half-year revenue of $4.284b, up 5.4 per cent, and net profit of $92m, down 46 per cent, and is paying an interim dividend of 18c a share on April 6.

Leading bank ANZ was down 63c or 2.24 per cent to $27.52 after competitor Commonwealth Bank of Australia said the number of its non-performing loans had risen to 3.2 per cent.

Steel & Tube, like Fletcher Building and Vulcan Steel, provided a softer outlook and its share price dropped 6c or 4.35 per cent to $1.32. Steel & Tube’s half-year revenue increased 11.7 per cent to a record $315.32m and its net profit was down 17.5 per cent to $11.83m. It is paying an interim dividend of 4c a share on April 6.

The wet weather impacted Steel & Tube’s activity in January and February, and the company said following the recent super cycle, it is well positioned to respond to moderating demand with a strong balance sheet and cash flow. It is managing costs and margins per tonne.

Napier Port, up 5c or 1.81 per cent to $2.81, told the market it had only minor damage from Cyclone Gabrielle, but damage to regional roading and rail networks is limiting access to the port.

Scales Corp, down 20c or 5.59 per cent to $3.38, said Mr Apple’s Hawke’s Bay orchards had some flooding and a full assessment will soon be made. Mr Apple’s packhouses and coolstores are fully operational. Scales is announcing its late full-year financial result next week.

Other decliners were Ebos Group decreasing 50c to $44; a2 Milk shedding 8c to $7.37; Seeka down 7c or 2.27 per cent to $3.01; and Serko falling 15c or 5.26 per cent to $2.70.

Bremworth was down 4.5c or 9 per cent to 45.5c; Tower declined 1c to 64c; and Smartpay decreased 5c or 3.57 per cent to $1.35.