“Local property companies have come back a long way in terms of net tangible assets, discounts of 20-30 per cent are not uncommon, and it appears buyers have entered the sector.
“But net tangible assets are historical and the market looks ahead to (latest) valuations which are falling. It is a battle with rising interest rates and cap rates and whether the companies can get rent increases through to match inflation,” Goodson said.
All the listed property stocks had solid rises. Argosy increased 3.5c or 3.29 per cent to $1.10; Goodman Trust improved 7c or 3.5 per cent to $2.07; Kiwi was up 2.5c or 2.96 per cent to 87c; and Stride gained 5c or 3.94 per cent to $1.32.
Vital Healthcare Property Trust added 7c or 3.46 per cent to $2.24; Precinct collected 3.5c or 2.87 per cent to $1.255; Property for Industry gained 3c to $2.25; and Investore was also up 3c or 2.16 per cent to $1.42.
Synlait Milk lost a further 13c or 5.42 per cent to $2.27 after confirming a sharp fall in its half-year earnings. It has fallen from $3.57 achieved on February 17.
Synlait reported an 83 per cent fall in net profit to $4.81m on revenue of $769.82m, down 3 per cent, for the six months ending January. Synlait is not paying an interim dividend and it reaffirmed its lower full-year profit guidance of $15m-$25m.
After earlier warning the market about its slowdown, Synlait said the advanced nutrition forecast demand and production has reduced, and it faced operational stability and cost challenges.
Goodson said the reaction to Synlait was interesting. “It still fell more than 5 per cent despite the pre-warning. The market has obviously given up any hope that a turnaround will happen any time soon.
“A2 Milk normally trades in tandem with Synlait but it has shaken this off and increased more than 1 per cent. It appeared to be more about Synlait’s specific issues,” he said.
Global marketer a2 Milk was up 9c or 1.43 per cent to $6.40. The Fonterra Shareholders’ Fund increased 7c or 2.13 per cent to $3.36.
Contact Energy increased 10c to $7.32 after launching a $200m, six-year green bond, with the ability to accept a $100m in over-subscriptions. Mercury Energy was down 9c to $5.98.
There were low volumes of trade amongst the leading stocks. “It was a very quiet day,” Goodson said. “The telephone was not ringing off the hook and this happens at times.”
Ebos Group marched nearer to its high of $46.49, gaining 57c to $45.69. Freightways added 13c to $9.33; Restaurant Brands was up 20c or 3.13 per cent to $6.60; Hallenstein Glasson gained 16c or 3.05 per cent to $5.40; Third Age Health increased 3c or 1.95 per cent to $1.57; and Oceania Healthcare was up 2c or 2.78 per cent to 74c.
The Warehouse Group was down 7c or 3.48 per cent to $1.94; Michael Hill decreased 5c or 4.59 per cent to $1.04; Scales Corp declined 7c or 2.44 per cent to $2.80; and My Food Bag dropped another 1.5c or 6.52 per cent to 21.5c.
Port companies Marsden Maritime Holdings was down 14c or 2.59 per cent to $5.26; Tauranga decreased 13c or 2.09 per cent to $6.08; South Port NZ shed 12c to $7.55; and Napier was up 3c to $2.58.
Serko fell 10c or 4.17 per cent to $2.30; Eroad declined 3c or 4.05 per cent to 71c; Cooks Coffee was down 1.5c or 4.76 per cent to 30c; Vista Group shed 4c or 3.05 per cent to $1.27; and PaySauce decreased 1.5c or 5.66 per cent to 25c.
AFT Pharmaceuticals, down 4c to $3.41, told the market it has registered its hand sanitiser, Crystawash Extend, for sale in China and has signed further licence agreements for the intravenous form of its Maxigesic pain relief in Switzerland and Latin America.
Comvita, down 1c to $34.24, has arranged a new $115m banking facility with ANZ and Westpac.
Promisia Healthcare, unchanged at 0.001c, has bought two adjoining properties to expand its rest home Aldwins House in Christchurch. Aldwins now has nearly 100 residents and Promisia has moved into a positive cashflow position.
