New Zealand shares fell for a second day in a broad selloff, with power companies among the hardest hit after Mercury NZ warned earnings would come under the pump in the current financial year. Synlait Milk unveiled plans to recapitalise the business after the trading ended.
The S&P/NZX50 Index fell for a second day, declining 104.03 points, or 0.8%, to 12,558.08. Across the main board, 80 stocks were lower, 57 rose and 42 were unchanged. Turnover was $120.2 million.
Mercury dropped 2.9% to $6.60 on a volume of 1 million shares after saying the current energy crunch would slice $90m from the June 2025 earnings before interest, tax, depreciation, amortisation and fair value adjustments (ebitdaf). The North Island electricity generator-retailer reported annual earnings rose 4% to $887m in the June 2024 year and hiked its dividend, while also flagging new renewable generation was expected to come on stream.
“They gave ebitda guidance a wee bit lower than the market expected due to the lower hydro conditions,” said Peter McIntyre, an investment adviser at Craigs Investment Partners. “You’ve got to put that in perspective because they have delivered a net profit of $290m from large moves in their unhedged financial instruments and 16 years of ordinary dividend growth.”
Contact Energy, which reported a 16% increase in operating earnings on Monday, fell 0.7% to $8.84, while Genesis Energy, due to report on Thursday, declined 0.7% to $2.28. Manawa Energy dropped 2.7% to $4 and Meridian Energy was down 1.7% at $6.50 on a volume of 1.1 million.