NZ Oil & Gas leads index to record

New Zealand Oil & Gas shares were up 3.4 per cent yesterday to 76c.

Energy explorer tells shareholders of plans to return $60m to them as market closes on ninth high in a row

New Zealand shares rose yesterday, 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 Mighty River Power paced decliners.

The benchmark index rose 5.04 points, or 0.1 per cent, to 5423.26. 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 per cent to 76c after the energy explorer told shareholders at yesterday's annual meeting it plans to return $60 million, or 15c per share, back to them, and is holding enough cash to grow its business as production increases. Still, it doesn't plan 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."

OceanaGold Corp led the benchmark higher, up 4.3 per cent to $2.21.

Dividend-paying stocks, such as power companies and property investors, paced decliners on a mixed day in trading, and 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.

Mighty River Power led decliners, falling 1.6 per cent to $2.815, followed by Meridian, down 1.2 per cent to $1.62. Among other yield stocks to fall were Goodman Property Trust, which fell 0.9 per cent to $1.10, Vital Healthcare Property Trust down 0.7 per cent to $1.52 and DNZ Property Fund which declined 0.6 per cent 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 per cent to a near three-month low 2c. The Dunedin-based biotech company expects a slower move to profitability after its first-half loss widened to $808,000 from $764,000 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 per cent 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 rose 4.2 per cent to 12.5c after the amphibious vehicle maker raised $1.3 million in a private placement to help fund development and working capital needs.

On the NZ Alternative Index, Just Water International rose 7.1 per cent to 15c. Its founder and majority shareholder Tony Falkenstein is offering shareholders 15c per share in a full takeover bid. His investment vehicle, Harvard JV, will waive all conditions, including the 90 per cent minimum acceptance, before it makes the full takeover bid.