NZ stocks: Sky TV result helps lift NZ shares

The sharemarket rose strongly in morning trade today, boosted by news of a huge rise in first half profit for pay TV operator Sky TV and a generally firmer tone elsewhere.

Shortly before midday, the NZSX-50 gross index was 21.32 points higher at 3178.54, while the NZSX all capital index was up 5.56 points to 1039.60.

By 11.30am Sky TV shares were 25c higher at a fresh high of $6.70 after the company said its net profit after tax for the six months to December 31 was $48.71 million up from $12.38 million for the same period a year earlier.

Amro Craigs Equities broker Matt Willis said while the headline figure was clearly ahead of market expectations the company was always going to be very profitable once it had amortised all the costs of rolling out its digital broadcasting network.

"It just endorses what a beautiful cash flow story that's going to be now that those costs have been absorbed."

The news also sent shares in media group INL, which currently owns 78 per cent of Sky, up 20c to a fresh high of 620.

The two companies are currently in discussions about a merger which is expected to be put to shareholders soon.

Sky City Entertainment Group also reported today, announcing a 4 per cent rise in first half profit of $57.1m.

However, investors were not impressed and Sky City shares were sold down 14c to 509.

The casino operator has faced difficulties from the recently introduced smoking ban and a limit on the size of denomination of bank notes its gambling machines can accept.

"Those two regulatory issues outside of the company's control are obviously impacting on earnings in an adverse way," Mr Willis said.

Elsewhere, top listing Telecom was up 7c this morning to 633, while number two stock by market capitalisation Contact Energy was up 12c to 712 and Auckland International Airport rose 7c to 860.

Other stocks to move by late morning included: Air NZ up 3c to 167, BayCorp Advantage up 8c to 335, Fisher & Paykel Appliances up 5c to 325, Fletcher Building up 2c to 710, Metlifecare down 10c to 370, Port of Tauranga up 8c to 553, Pumpkin Patch up 4c to 347 and Tower down 3c to 191.

Total turnover by 11.30am was worth $28.94 million and gainers outnumber losers 39 to 30 on 131 stocks traded.

- NZPA and AAP