Yovich & Co. Market Update - 26 November 2018

Nov 26, 2018 | Commentary

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New Zealand Equities

In summary, the NZX50 had 18 companies on the downside, 14 remained unchanged and 18 companies were on the upside. The biggest movers of the week were Fletcher Building -5.48%, Telstra -5.31%, Auckland AirPort -3.34%, Steel & Tube -3.23% and Sanford -3.15% on the downside, with Kathmandu 7.31%, ANZ bank Group 5.68%, Hallenstein Glasson Holdings 4.79%, Restaurant Brands 4.24% and Fisher & Paykel Healthcare 3.10% on the upside.

Cleanaway Waste Management.

Is a provider of waste management services in Australia, with operations in both solid and liquid waste. A recent acquisition of Toxfree Solutions strengths Cleanaway’s existing operating segments and provides a leading position in the medical waste segment.

Net revenue for the FY18 is up 15.9% at $1.5b from $1.3b, and tax paid profit for the FY18 is up 26.2% at $97.8m from $77.5m.

Gross dividend payment of 2.5c per share compared with 2.1c the previous year. Current share price is $1.70 and gross yield is 1.47%.

Napier Port

Continuing our coverage from October, the latest news is that 57% of the Hawke’s Bay ratepayers have now backed the proposal. The Hawkes Bay Regional Council is considering selling up to 45% interest in Napier Port through a share offer in order to free up capital and diversify the council’s investment base. The council indicated the sale could raise $181m. Napier Port is NZ’s fourth-largest container port.

Fisher & Paykel Healthcare

Are a leading designer, manufacturer and marketer of products and systems for use in respiratory care, acute care, surgery and the treatment of obstructive sleep apnoea. The company’s products are sold in over 120 countries worldwide. Half year results ending 30 September show a record tax paid profit up 20% at $97.4m.

Expected full year net profit to be between $205m - $210m, an interim gross dividend of 13.54c per share payable 21 December, an 11% increase. At current share price of $13.26 gross yield is 2.32%.

New Zealand Refining Company

Is offering up to $75m of unsecured, subordinated notes with a interest rate in the range of 5.1% to 5.3% per annum. The bookbuild is expected to be completed on or about 29 November, with the offer expected to open 30 November and close 12 December,  with first election date being 1 March 2024, maturity date is 2034.

Turners Automotive Group

Has 3 main core operating divisions:

1. The Automotive Retail Division where they control the buying and selling of second-hand cars, trucks, and   machinery. Turners is the largest second-hand vehicle retailer in New Zealand.

2. The Finance and Insurance Division where they help customers with simple and attractive finance and insurance products across New Zealand.

3. The Debt Management and Credit Collection Division where they help businesses of any size in New Zealand and Australia with collecting debt from customers who are not paying.

Six months ending 30 September results show tax paid profit up 28% at $12.9m.

Second quarter gross dividend of 5.56c per share payable 30 January, bringing total gross dividend for half year to 11.11c per share.

Expected gross dividend for the FY19 to be 9.37% at current share price of $2.52.

Arvida Group Limited

Is one of the larger operators of aged care facilities and retirement villages in New Zealand. The group comprises 29 villages spread nationally with 1,752 retirement units and 1,764 care beds. Over 3,500 residents are provided a continuum of care that extends from independent living to full rest home, hospital and dementia level care.

Six months ending 30 September results show revenue up 26% at $76m. Tax paid profit is up 111% at $30.5m.

Second quarter gross dividend of 1.55c per share payable 20 December, bringing total gross dividend for half year to 3.1c per share. Expected gross dividend for the FY19 to be 4.7% at current share price of $1.32.

Disclaimer: This publication has been prepared for your general information. While all care has been taken in the preparation of this publication, no warranty is given as to the accuracy of the information and no responsibility is taken for any errors or omissions. This publication does not constitute financial or insurance product advice. It may not be relevant to individual circumstances. Nothing in this publication is, or should be taken as, an offer, invitation, or recommendation to buy, sell, or retain any investment in or make any deposit with any person. You should seek professional advice before taking any action in relation to the matters dealt within this publication. No part of this publication may be reproduced without prior written permission from our company. Disclosure statements relating to the financial advisers associated with this newsletter are available on request and free of charge.

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Nathanael McDonald



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New Zealand Refining Company Ltd NZR.nz Cleanaway Waste Management CWY.asx Napier Port Fisher & Paykel Healthcare FPH.nz Turners Automotive Group TRA.nz Arvida Group Limited ARV.nz Investment News



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