MARKET CLOSE: NZ shares extend gains as NZOG signals capital return
New Zealand shares rose, pushing the NZX 50 Index to its ninth straight record close, as New Zealand Oil & Gas signalled plans for a capital return given cash flow from production at its Tui oil field. Dividend-paying stocks, including Meridian Energy and MightyRiverPower paced decliners.
The benchmark index fell 5.04 points, or 0.1 percent, to 5423.259. Within the index, 18 stocks rose, 22 stocks fell, and 10 stocks were unchanged. Turnover was a lighter-than-usual $83 million.
New Zealand Oil & Gas paced gainers, up 3.4 percent to 76 cents after energy explorer told shareholders at today's annual meeting it plans to return $60 million, or 15 cents per share, back to them, and is holding enough cash to grow its business as production increase. Still, it doesn't plan to deliver any more dividends in the near term while it deducts its exploration expense from its tax bill.
"The difficulty they need to face is finding something to replace Kupe eventually," said Paul Harrison, head of equities at Salt Fund Management. "They need to find something new, and it's difficult for investors to know what that could be."
OceanGold Corp led the benchmark higher, up 4.3 percent to $2.21.
Dividend paying stocks, such as power companies and property investors, paced decliners on a mixed day in trading, and Salt Funds' Harrison said the market was struggling to carry on the exuberance of last week's gains.
"We had such a positive week last week, the market's looking for more signals and is wondering whether it's run its course," he said.
MRP led decliners, falling 1.6 percent to $2.815, followed by Meridian, down 1.2 percent to $1.62. Among other yield stocks to fall were Goodman Property Trust, which fell 0.9 percent to $1.10, Vital Healthcare Property Trust down 0.7 percent to $1.52 and DNZ Property Fund which declined 0.6 percent to $1.755.
Precinct Properties New Zealand was unchanged at $1.115. The property investor, formerly known as AMP NZ Office, has tapped US investors for US$75 million in a private debt placement with the proceeds to be used to repay debt.
Outside the benchmark index, Blis Technologies slumped 23 percent to a near three-month low 2 cents. The Dunedin-based biotech company anticipates a slower move to profitability after its first-half loss widened to $808,000 from $764,00 a year earlier and says it faces disciplinary action from the stock market regulator over an announcement it made in August.
Car and tractor dealer Colonial Motor Co rose 0.2 percent to $6.01 after industry figures showed new vehicle sales reached a record in October and are on track for the highest ever annual total this year.
Sealegs Corp gained 4.2 percent to 12.5 cents after the amphibious vehicle maker raised $1.3 million in a private placement to a private investor to help fund development and working capital needs.
On the New Zealand Alternative Index, Just Water International climbed 7.1 percent to 15 cents. The water cooler and supplies company's founder and majority shareholder Tony Falkenstein is offering shareholders 15 cents per share in a full takeover bid for the business. His investment vehicle, Harvard JV will waive all of the conditions, including the 90 percent minimum acceptance, before it makes the full takeover bid.