NZ shares rise as earnings continue

New Zealand shares rose as earnings season continued to deliver mixed results.

New Zealand shares rose as earnings season continued to deliver mixed results. NZX was among gainers on the day after delivering a special dividend while Heartland Bank fell on its increased bad debt provisioning.

The S&P/NZX 50 index increased 15.55 points, or 0.2 per cent, to 8,987.49. Within the index, 26 stocks gained, 19 fell, and five were unchanged. Turnover was $111.7 million.

Company reporting season continued with NZX declaring a special dividend from the sale of non-core assets. Chief executive Mark Peterson was also upbeat about how far the stock market operator has come in its five-year transformation plan. The shares rose 1.8 per cent to $1.11.

Heartland Bank reported an 11 per cent increase in net profit, driven by growth from its reverse mortgage business, and said it will target double-digit earnings growth again for the 2019 year. Still, the stock fell 1.7 per cent to $1.71 as the bank increased provisioning for bad debts.

Shane Solly, a portfolio manager at Harbour Asset Management, said some parts of the market are fully-priced. That means earnings results need to be good to lift share prices. That's added to volatility in markets, especially in Australia.

"It's very modest turnover whether it's New Zealand or Australia - investors are very much reading the entrails of results," he said.

NZX's result was "better than people were expecting" while Heartland's "provisioning was slightly higher than expected".

Among companies reporting tomorrow, Skellerup Holdings fell 1.6 per cent to $2.01. Precinct Properties New Zealand was unchanged at $1.39.

Fonterra Shareholders' Fund units rose 1 per cent to $4.85 after Fonterra appointed Miles Hurrell interim CEO effective immediately, accelerating the departure of Theo Spierings who will linger for a month to aid the transition.

The dairy cooperative will report earnings next month, which will be at the bottom end or slightly below guidance as margins were squeezed across the wider group.

Synlait Milk rose 3.6 per cent to $11.19, leading the benchmark index higher. A2 Milk Co fell 1.3 per cent to $1.30.

Infratil rose 0.9 per cent to $3.42 and Mercury NZ fell 0.6 per cent after the companies mounted a takeover offer for wind farm operator and developer Tilt Renewables at $2.30 a share. Infratil already holds a controlling stake in Tilt having overseen the demerger from Trustpower in 2016, and Solly said the partners understand the sector. Tilt shares gained 6.6 per cent to $2.27.

Wellington Drive Technologies gained 5.7 per cent to 18.5 cents after saying first half profit rose 18 per cent on burgeoning demand for its Internet-of-Things products.

NZAX-listed Cooks Global Foods was unchanged at 7.5 cents after announcing a conditional purchase of Wellington coffee chain Mojo Coffee Cartel for $19m in cash, scrip and debt. That's more than half Cooks' current market value.

Sky Network Television posted the biggest decline on the NZX 50 today, falling 2 per cent to $2.52. Telecommunications firm Spark New Zealand yesterday expanded its foray into premium sports content by buying the rights for the English Premier League in 2019. Spark shares rose 1.2 per cent to $3.895.

Among blue chip stocks, Mainfreight gained 0.5 per cent to $27.97, Fisher & Paykel Healthcare Corp rose 0.5 per cent to $14.86, Meridian Energy increased 0.3 per cent to $3.135 and Auckland International Airport advanced 0.3 per cent to $6.76.