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Warehouse restructuring pulls shares down

NZ Newswire logoNZ Newswire 24/02/2017 Sophie Boot

© Shutterstock New Zealand shares fell on Friday, with Warehouse Group and Mercury New Zealand ending down, while Air New Zealand rose.

The S&P/NZX50 Index dropped 30.93 points, or 0.4 per cent, to 7,058.59. Within the index, 23 stocks fell, 14 were unchanged and 13 rose. Turnover was $127.5 million.

Warehouse Group led the index lower, down 2.6 per cent to $2.59. On Thursday, the retailer said it expects to shed a net 130 jobs, or about 1.1 per cent of its workforce, in an effort to save up to $20 million a year after slimming down the structure of its retail model to try to strip out duplication.

"It hasn't reported this earnings season but obviously had the news about head office restructuring - while there's a bit of cost saving there, I think people are generally seeing a mixed environment out there for retail," said Mark Lister, head of private wealth research at Craigs Investment Partners.

Mercury dropped 2.6 per cent to $3.05, while Trade Me Group fell 2.4 per cent to $4.92.

Metro Performance Glass fell 2.2 per cent to $1.36, while Fletcher Building fell 1 per cent to $9.70. Fletcher dropped 5.2 per cent on Wednesday after posting a 2 per cent gain in first-half profit that included unexpectedly weak earnings from its construction division, especially given its $2.7 billion backlog of work.

Vector dipped 0.3 per cent to $3.24. The Auckland-based electricity and gas distributor posted a 7 per cent gain in first-half profit to $107m, driven by stronger sales, lower finance costs and a one-time gain after a Court of Appeal ruling on a tax claim.

Air New Zealand was the best performer, up 1.3 per cent to $2.28, while Spark New Zealand gained 1 per cent to $3.565 and Skycity Entertainment Group rose 1 per cent to $4.09.

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