You are using an older browser version. Please use a supported version for the best MSN experience.

Tegel struggles after chicken size warning

NZ Newswire logoNZ Newswire 7/03/2017 Sophie Boot

Chicken in a coup © Fairfax Media/Fairfax Media via Getty Images Chicken in a coup New Zealand shares dipped on Tuesday, with Chorus and A2 Milk Co declining, while Metlifecare and dual-listed banks rose.

The S&P/NZX 50 Index dropped 11.1 points, or 0.2 per cent, to 7,167.64. Within the index, 23 stocks fell, 14 fell and 13 were unchanged. Turnover was $130.7 million.

Chorus was the worst performer, down 2 per cent to $3.91, while A2 Milk Co fell 2 per cent to $2.46 and Auckland International Airport declined 1.8 per cent to $7.12.

Tegel Group was unchanged at $1.28. The Commerce Commission has warned the chicken producer, along with rival Inghams Enterprises, for packaging chickens with misleading sizes.

The companies were "likely to have made misleading representations about chicken size by including stuffing and marinade in the weight of chickens" by specifying a weight range for a stuffed and marinated chicken while the weight of the chicken itself was lower, the regulator said.

Tegel shares, which sold in the company's initial public offering last May at $1.55, have weakened since, falling sharply in December after the company said it would miss its forecast earnings as a glut of chicken kept a lid on domestic prices and rising freight costs squeeze margins.

"They haven't been doing fantastically since they listed, investors will be looking for some good news before they get back in," said Grant Davies, investment advisor at Hamilton Hindin Greene.

Metlifecare was the best performer, up 3.3 per cent to $6.30.

Last month, it reported a 31 per cent jump in first-half profit that was aided by a gain in the value of its property, while chief executive Glen Sowry cited strong demand for its units and an occupancy rate that has edged up to 97 per cent. The shares have gained 7.7 per cent since then.

Dual-listed banks ANZ Banking Group gained 1.6 per cent to $34.11, while Westpac gained 1.3 per cent to $37.38.

image beaconimage beaconimage beacon