The steel processor and distributor will pay an interim dividend of 2.5c a share on March 27, down from 12c in the previous period. Sales volume was down 8.3% to 109,217 tonnes, while active customers were steady at 22,612.
Vulcan achieved a 10% return on capital and net bank debt decreased $34.3m to $241.5m by the end of December. Vulcan expects trading volumes to start recovering in the second or third quarter this year – with lower interest rates boosting confidence for the future.
Mark Lister, investment director with Craigs Investment Partners, said the market was expecting a subdued result from Vulcan but it was more upbeat about the next 12 months.
“I think Vulcan has set the tone for the reporting season,” he said. “You will see more mediocre results but glimpses of optimism for the year ahead in the companies’ outlook statements.”
Lister said markets this week will be closely following Federal Reserve chairman Jerome Powell’s testimony to the US Senate Banking Committee and the release of the Consumer and Producer Price indices.
“The market is interested in Powell’s take on the impact of tariffs, where inflation is at and what the Fed will do.” Consumer inflation expectation has become anchored around the 3% level, higher than the central bank’s 2% target.
Wall Street had a strong day despite President Donald Trump slapping 25% tariffs on steel and aluminium imports, with Australia exempted because of its trade surplus with the US. Trump also signalled additional tariffs on automobiles, pharmaceuticals and computer chips.
Commentators said that while tariffs are a threat to US market stability, investors are largely brushing off the trade war rhetoric, though a tit-for-tat spat is still in place. China announced US$14 billion ($24.79b) in tariffs on US-made goods while the US has put a 10% tariff on Chinese imported goods.
The Dow Jones Industrial Average was up 0.38% to 44,470.41 points; S&P 500 gained 0.67% to 6066.44; and Nasdaq Composite increased 0.98% to 19.714.27.
Back home, insurer Tower increased 5c or 3.61% to $1.435 after reporting improved trading in the first quarter ending December, with gross written premiums rising 6% to $155m – average premiums reduced year-on-year due to lower inflation and increased volume in lower risk assets.
The business-as-usual claims ratio decreased to 39%, from 57% compared with the previous corresponding period, and the management expense ratio was reduced to 30%, from 32%.
Tower told shareholders at the annual meeting that the New Zealand business grew by 8000 policies, mainly house and contents, and overall customer numbers increased 5000 to 310,000 from the end of September.
Tower is returning $45m to shareholders in early April by cancelling one in every 10 shares held at $1.1858 per share.
Meridian Energy was up 7.5c to $5.975; Ebos Group gained 39c to $42.05, Auckland International Airport added 7c to $8.75; Port of Tauranga collected 6c to $6.51; Ryman Healthcare was up 7c to $4.37; and Steel & Tube improved 3c or 3.61% to 86c.
Vector was up 9c or 2.33% to $3.96; Synlait Milk gained 2c or 3.23% to 64c; Move Logistics increased 2c or 9.09% to 24c; Eroad added 2c or 1.87% to $1.09; and Santana Minerals rose 4c or 6.45% to 66c.
Gentrack fell 54c or 4.14% to $12.50; Heartland Group decreased 2c or 1.82% to $1.08; Bremworth declined 4c or 7.41% to 50c; and Blackpearl Group shed 4c or 5.41% to 70c.
Among other decliners, Napier Port was down 6c or 2.21% to $2.65; NZX decreased 4c or 2.61% to $1.49; and Sky TV shed 7c or 2.62% to $2.60.
Argosy Property, up 0.005c to $1.015, has signed new tenants for two 6 Green Star buildings in Onehunga and Mt Richmond – Bascik Transport on a 12-year lease with annual rental of $1.77m, and global healthcare company Viatris for a 10-year lease with annual rent of $1.88m.
