Kathmandu reinstates dividend payments

Business & Investing: Kathmandu benefits from RipCurl business, Plus: Huljich family sells Pushpay stake to US investment firm

Outdoor retailer Kathmandu yesterday announced half year results that were broadly in line with earlier guidance.

The result was further boosted after the retailer confirmed it had resumed paying a dividend, underpinned by a strong result from its Rip Curl acquisition.

Despite the impact of Covid, underlying pre-tax and depreciation earnings were $48.2 million in the six months to January 31 versus $40.5m in the previous year.

Underlying sales lifted 12.9 percent to $410.7m and included the six-month contribution from Rip Curl.

“Despite operating in challenging conditions over the first half due to the substantial impacts from Covid-19, Rip Curl delivered an outstanding first-half result, validating the group’s diversification strategy,” said group chief executive Xavier Simonet.

Underlying net profit lifted 32.8 percent to $23.1m while net profit was $22.3m versus $7.6m in the prior year. Its online penetration increased from 8.8 percent to 12.7 percent during the period

The company said it would pay an interim dividend of two cents a share but did not provide any full-year guidance.

Its shares closed up 8.9 percent at $1.35.

Fellow retailers The Warehouse Group and Hallenstein Glassons are set to report their half year results this Thursday and Friday respectively.

Pushpay announces new cornerstone shareholder after Huljich family exits

Pushpay Holdings now has a new cornerstone shareholder after original investors Peter and Christopher Huljich opted to sell down the remainder of their stake in the company to US-based investment firm Sixth Street Partners.

Sixth Street now owns 17.8 percent of the donation software company after paying the Huljich family $320 million, or $1.85 a share for the 173 million shares they have acquired.

Pushpay shares closed up 10.2 percent at $1.95 on the news.

Chair Graham Shaw welcomed Sixth Street as a “new cornerstone investor” with the acquisition making it the firm’s largest shareholder.

“As a highly experienced technology and growth investor with a core thematic focus on the convergence of software and payments, Sixth Street’s global scale and partnership-oriented investing approach brings considerable strength to Pushpay’s shareholder register,” he said.

San Francisco-based Sixth Street is a global investment company with US$50 billion in assets under management. It has also invested in household names such as Airbnb and Spotify.

The Huljich family previously sold a quarter of their holding in July last year for $123.8 million after the share price surged during the pandemic when many church groups were forced to hold services online, necessitating the use of online donation software services.

Scales Corporation confirms its interest in Villa Maria but says no deal has been finalised

Primary sector products exporter Scales Corporation yesterday attempted to dampen down media speculation that it is in the process of acquiring winery business Villa Maria.

The Australian Financial Review’s Street Talk column speculated that Scales was understood to have submitted the leading bid for the winemaker, which has an estimated market value of around A$200 million.

In a brief statement yesterday Scales confirmed that it is participating in the sale process for Villa Maria but cautioned that “there is no certainty that its participation will result in any transaction.”

“Scales continues to explore a range of growth opportunities, including acquisitions, and our policy is not to comment on media speculation. Scales continues to comply with its continuous disclosure obligations, including NZX Listing Rule 3.1.1.”

Scales shares closed up 1.3 percent at $4.61.

Oceania Healthcare set to raise $100 million in additional capital

Retirement village operator Oceania Healthcare has announced it will raise up to $100 million of fresh equity to pay for the $77m acquisition of an existing village at Hobsonville Point and 6.1 hectares of land at Franklin.

The company will raise $80m of the equity through a fully-underwritten placement to institutional investors and the other up to $20m will come from a non-underwritten share purchase offer to retail investors.

The new equity will also provide the company with additional financial capacity.

“Oceania has a well-established and proven brownfield development-led growth strategy, facilitated by investment in an operational platform built for scale and a strong development team,” the company said.

Oceania also announced that it has permanently appointed former CFO Brent Pattison as the company’s chief executive.

Shares in the company are currently in a trading halt but last traded at $1.39 on Monday.

ECB accelerates pace of emergency bond buying programme

The European Central Bank has accelerated the weekly pace of its emergency bond-buying programme to its highest level in over three months in as it attempts to counter the recent sell-off in eurozone debt markets.

The ECB bought €21.1bn of bonds under its pandemic emergency purchase programme (PEPP) in the week to March 17 — up from €14bn a week earlier and above the €18bn weekly average since the programme started last year according to new data from the central bank.

The quickening of bond-buying by the ECB was widely expected after it announced earlier this month that its purchases under the €1.85tn scheme would be “conducted at a significantly higher pace” in the coming three months.

Markets were largely unmoved following Monday’s announcement, which was broadly in line with analysts’ expectations. The Italian 10-year bond yield slipped as much as 0.01 percentage points to 0.659 percent. German 10-year bunds were steady at around minus 0.3 per cent. Yields fall as prices rise.

In a warning to bond markets Christine Lagarde, ECB president, said that the central bank could adjust the pace of PEPP purchases “at any point in time in response to potential changes in market conditions” to achieve its goal of maintaining “favourable financing conditions”.

Goldman Sachs workplace culture under review following criticism from junior staff

US investment bank Goldman Sachs says it will strengthen enforcement of its “Saturday rule” and speed up hiring of more junior bankers after a group of analysts described “inhumane” working conditions, including 95-hour weeks as standard and ongoing instances of workplace abuse.

“This is something that our leadership team and I take very seriously,” CEO David Solomon said in a message sent to staff on Monday (NZ time).

A survey of 13 first-year analysts said their mental health and relationships with friends and family were suffering and the insights they shared painted a grim picture of a life at the bottom of the food chain within the prestigious banking firm.

One of the analysts’ pleas to management — in addition to capping work weeks at 80 hours — was to better enforce the “Saturday rule,” which stipulates that junior staff should not be expected in the office between 9 pm Friday and 9am Sunday.

Virtually all of the analysts said they felt pressure from “unrealistic deadlines” and have been shunned or ignored in meetings.

Andrew Patterson is Newsroom's Markets Editor and has worked for decades as a financial journalist, radio presenter and editor with Australia's ABC, Radio Live and NBR.

Leave a comment