Positive earnings reports boost index

The S&P/NZX50 Index rose 25.25 points, or 0.3 per cent, to 7,388.35. Photo / Supplied

New Zealand shares gained as early earnings reports skewed positive, with Steel & Tube Holdings and Summerset Group gaining on their results.

The S&P/NZX50 Index rose 25.25 points, or 0.3 per cent, to 7,388.35. Within the index, 31 shares rose, 17 fell and three were unchanged. Turnover was $109 million.

Steel & Tube Holdings led the index, up 10.5 per cent to $2.42, a 10-month high. First NZ Capital analysts raised their rating on the stock following the steel products maker posting better-than-expected annual earnings and lifting its dividend payment on Friday.

The Lower Hutt-based company reported an underlying profit of $19.4 million in the year ended June 30 on record sales of $516m as the contribution from new acquisitions and cost savings helped offset weaker prices and margins as well as costs related to "quality issues".

"The market had time to react on Friday, and it did, I guess the market's had time to digest some of the aspects of the result and it's got a little more optimistic," said Mark Lister, head of private wealth research at Craigs Investment Partners.

Summerset Group gained 4.8 per cent to $5.20 - an all-time high. The retirement village operator and developer lifted first-half earnings 44 per cent to $24.7m in the six months ended June 30, beating expectations, and will pay a larger dividend than anticipated after enjoying a record second quarter of unit sales.

"Their result was a very good result, it was expected to be strong but it was even better again," Lister said.

New Zealand Refining Co gained 4.1 per cent to $2.52, Ebos Group rose 2.7 per cent to $17.67, and Warehouse Group advanced 1.8 per cent to $2.85.

Contact Energy rose 0.2 per cent to $5.27. The electricity and gas provider posted little-changed full-year operating earnings amid signs that electricity demand is starting to grow after a long period of decline and that its investment in technology to gain and retain customers is starting to show returns.

Kathmandu Holdings was the worst performer, down 2 per cent to $1.93.

Genesis Energy dropped 1.8 per cent to $2.22 and Meridian Energy fell 1.2 per cent to $2.865.

Freightways dipped 1.2 per cent to $6.66. The courier company delivered a steady if unspectacular full-year result with both increased revenue and profits.

"It was a little softer than people would've liked as well, and the outlook commentary was a little more subdued than people would've liked to see as well," Lister said.

Outside the main index, Pushpay Holdings advanced 5 per cent to $2.52. The mobile payments app developer brought forward its target for reaching $100m of annualised committed monthly revenue to December 2017 as it narrows its focus to larger customers.