Earnings before interest, tax, depreciation and amortisation are likely to be at the upper-end of previous guidance of between $55m and $62m in calendar 2017, the Christchurch-based company said. Ebitda in the prior year was $67.3m.
"The update they gave to the market yesterday was really positive," McIntyre said.
"Scales is a company that's well-capitalised and has the ability to acquire other businesses: it's still in growth mode, and it's a good dividend payer. It's the 2018 guidance that has really excited the market, you've seen some good volume go through Scales today on that basis. They tend to under promise and over deliver, they've performed exceptionally well for investors and there's definite confidence around management."
Z Energy traded lower for most of the day, falling as low as $7.44 but closed up 0.1 per cent to $7.68. Today, the government said it has asked the Ministry of Business, Innovation and Employment to further investigate fuel prices and is looking to increase the Commerce Commission's market studies powers by the end of next year after getting more information on the fuel market.
The government's release this afternoon included submissions from Z Energy, BP Oil New Zealand, Gull New Zealand, and Mobil Oil New Zealand, written after the study was released in July.
Z said it was "open to a conversation around the point of how to encourage a more liquid wholesale market" but stressed the importance of maintaining a commercial approach to the matter and protect the property rights of companies that invest in assets.
Outside the benchmark index, Tegel Group fell 12.9 per cent to $1.22. New Zealand's biggest poultry producer increased sales and recorded an improved gross margin in its first half, while higher expenses pushed profit down 2.3 per cent. It is still aiming for an improved full-year result on an underlying earnings basis.
Net profit was $14.8m in the six months ended October 29, from $15.1m a year earlier, the Auckland-based company said. Sales rose 2 per cent to $302m as Tegel lifted processed poultry volumes by 0.8 per cent to 48,676 tonnes.
"It looks like it's going to be a stretch for them to make their full-year earnings forecasts, it was softer than what the market anticipated," McIntyre said. "They were estimating around that $80 million mark for 2018. It's disappointing on the export front, though solid domestic revenue. Management had been indicating growth would come from exports, so they disappointed on that front today.
Veritas Investments was unchanged at 6.4c. It expects annual profit to fall as much as 17 per cent in the 2018 financial year, issuing the earnings downgrade in a notice to the stock exchange following today's annual meeting.
