New Zealand shares slipped from a record, with Spark New Zealand falling after managing director Simon Moutter signalled his exit from the country’s biggest telecommunications company. 

The S&P/NZX 50 Index fell 19.09 points, or 0.2 percent, to 9,9939.26, snapping a six-day gain. Within the index, 24 stocks declined, 20 gained, and six were unchanged. Turnover was $193.5 million.

Spark declined 3.3 percent to $3.65 on an average volume of 5.5 million after Moutter announced his departure at the end of June, with customer director and former finance chief Jolie Hodson to take over the reins. Fat Prophets lowered its rating on Spark to ‘sell’ from ‘buy’, saying Moutter’s departure was a surprise and that the timing felt a year or so early. 

Rickey Ward, NZ equities manager at JBWere, said there had been some speculation last year that Moutter was going to leave given how long he’d been at Spark, but that was quickly shot down. 

“The real surprise part is ‘why 1 July?’, and not ‘why?’,” Ward said. “He’s well-respected by many, many investors. The share price fall today is purely on the back of his resignation.” 

Ward said Hodson’s involvement in Spark in the executive team indicated that succession had been planned over a few years rather than a few months and that the company’s strategy won’t stray too far from the current path. 

Moutter has been on “good leaver” provisions since 2016, in which June 30, 2019, is nominated as the earliest date at which he could become eligible for 100 percent of his long term incentive package without being an employee of the company.

Chorus, which counts Spark as its biggest customer, rose 0.9 percent to $5.90, while Sky Network Television, which has been fighting of more aggressive bids for sports content from Spark, fell 3 percent to $1.28. 

Genesis Energy led the market lower, down 5.5 percent, or 18 cents, to $3.075. The country’s biggest electricity retailer shed rights to an 8.45 cent dividend today. Tourism Holdings, which shed rights to a 13 cent dividend, was down 0.6 percent, or 3 cents, at $5.02. 

Ward said the low interest rate environment continues to stoke investor demand for companies paying reliable dividends, such as utilities and property companies, which attracted the biggest volume of trading today. 

Kiwi Property fell 0.3 percent to $1.505 on a volume of 2.8 million shares, Meridian Energy was down 2.2 percent at $4.04 on volume of 2.2 million, while Mercury NZ fell 0.5 percent on volume of 1.4 million. Contact Energy fell 0.1 percent to $6.99 on 1.3 million and Goodman Property Trust was unchanged at $1.72 on 1.3 million units. Auckland International Airport slipped 1.8 percent to $8.20 on a volume of 1.3 million shares. 

Air New Zealand rose 0.9 percent to $2.675 on a bigger volume than normal of 3.4 million, and Ebos Group fell 2.8 percent to $21.39 on a volume of 1.9 million, much more than its 90-day average of 42,000 shares. 

A2 Milk Co rose 1.1 percent to $1.474 on a volume of 1.1 million, with investors unfazed by its acknowledgment that rising dairy prices may affect gross margin in the June 2020 financial year.

Z Energy increased 0.2 percent to $6.40 on volume of 1.1 million. After the close of trading, Z said it’s re-signed a crude oil supply contract with Shell International Eastern Trading Co for a maximum of five years. 

Trade Me Group was unchanged at $6.43 with 1.1 million shares changing hands. Shareholders today overwhelming supported a takeover offer via a scheme of arrangement from UK private equity firm Apax Partners at $6.45 a share. Chair David Kirk said since the late-2011 initial public offering, investors have received an average annual return of almost 18 percent, including dividends. 

NZX fell 1 percent to $1 on a volume of 403,000, about twice its 90-day average, after reporting a small decline in transaction volumes in March. The stock market operator is holding its annual meeting in Dunedin on Friday. 

SkyCity Entertainment Group posted the biggest gain on the day, up 2.6 percent at $3.93 on an average volume of 623,000 shares. 

Outside the benchmark index, Scott Technology fell 0.4 percent to $2.55 after reporting a 62 percent increase in first-half profit, stemming largely from its recent acquisitions. The manufacturer’s board kept the interim dividend unchanged at 4 cents a share. 

Colonial Motor Co fell 1.2 percent to $8.25 after Motor Industry Association figures showed another decline in new car registrations in March. The motor vehicle distributor sheds rights to 15 cent dividend tomorrow. 

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