Warehouse shares rally after Normans boost stake

Anne Norman and David Norman. Photo / Sarah Ivey.

Shares in The Warehouse Group rallied after David and Anne Norman, the owners of the retail group that controls Farmers and Whitcoulls, boosted their stake in New Zealand's largest listed retailer.

The Normans' firm, James Pascoe, snapped up 305,000 Warehouse shares for a net consideration of $817,000 on Wednesday, lifting their stake in the company from 6.3 per cent to 7.4 per cent, according to a substantial security holder notice released yesterday.

Warehouse shares, which had been trading near a two-and-a-half-year low earlier in the week, gained 3.4 per cent on Wednesday and closed up 4c at $2.75 last night.

Kevin Turner, the group general manager of finance at James Pascoe, declined to make any comment on the increased stake other than to say "it's another investment".

Salt Funds Management managing director Paul Harrison said the Normans' buying of Warehouse stock was a major factor "holding the share price up".

"Without them in the market, buying, the stock price would be significantly lower," Harrison said.

He said the Normans might be interested in having more influence over the Warehouse, possibly at a board level.

James Pascoe's other retail brands include jewellers such as Pascoes, Stewart Dawson and Goldmark.

The Warehouse released a disappointing trading update on January 7, saying adjusted first-half profit was likely to be about $37 million, which would be a roughly 20 per cent decline on the previous year.

Chief executive Mark Powell said poor seasonal weather conditions had forced the Red Sheds to "sacrifice margin to manage seasonal stock sell through".