South Island companies overcame a tough and challenging three months to achieve a hard-fought gain of $159.2 million in capital value for the June quarter, according to the Deloitte South Island Index.
Deloitte Christchurch corporate finance partner Scott McClay said when releasing the index yesterday, the quarter showed the resilience of the 31 companies in the SI index.
Only a handful of substantial decreases were recorded against a backdrop of unfavourable economic conditions.
Since the inception of the index, there had been many periods where it significantly outperformed the other major indices Deloitte tracked, he said.
''This performance is supported by the mix of traditional, innovative and large mainstream companies that are represented on the index and call the South Island home.''
The index tracks the quarterly performance of listed companies with operations in the South Island.
It ended the June quarter at its highest quarterly point since its inception in 2007, rising 1.1%.
The top three companies recorded mixed performances.
Meridian Energy and Ryman Healthcare increased their market capitalisation while Ebos Group reported a fall.
In dollar terms, Meridian was the stand-out performer, gaining $346million, while Ryman also continued to perform impressively, Mr McClay said.
Only three of the seven industry sectors posted movements in the June quarter - energy and mining, property and retail which gained 21.1%, 6.4% and 0.5% in market capitalisation respectively.
The retail sector was driven upwards by the performance of Kathmandu Holdings after the company turned around losses suffered in the previous four quarters, he said.
''The company was on track to achieve a small positive result, which turned into a large gain after the announcement in late June of Briscoe Group's statement of intent to lodge a takeover notice of Kathmandu Holdings.''
The property sector was boosted by the positive result of Ryman, up $40 million, as the company announced a record profit of $136.3 million in the year ended March 31.
The energy and mining sector's positive result was once again upheld by Meridian. Without Meridian, the sector would have reported a fall of 25%, Mr McLay said.
The manufacturing and distribution sector had a poor quarter, declining a collective $88.6 million, or 4.6%, as all four companies in the sector experienced poor performances. The downturn was led by Ebos.
The primary sector had another troublesome quarter, dropping 6.7%, led by Synlait Milk's decrease of $77.5 million (18%) and PGG Wrightson's decline of $18.9 million (5.2%).
The impact of the dry summer and global commodity prices had an effect on both companies, he said.
The other sector had its first fall in six quarters, down 3.8% with four of the six companies experiencing a decline.
The sector's decline was led by Heartland New Zealand decreasing by $49.9 million, or 8%, followed by SLI Systems dropping 26.8%, or $18.8 million, in market capitalisation.
The biotechnology sector experienced the largest loss of all the sectors on a percentage basis, down 19% due to Pacific Edge's poor performance during the quarter.
This quarter's fall is the fourth for the sector in the past five quarters.
Annually, the South Island Index increased by $1.65 billion, or 12.7%, during the year ended June.
Comparatively, it significantly outperformed the increases in the NZX-50 capital index of 6.2%, the Dow Jones of 4.7% and the ASX All Ordinaries of 1.3% The top annual performances came from Meridian, up $2.4 billion, Heartland, up $109.7 million and Skyline Enterprises, up $74.9 million.
In percentage terms, Meridian still topped the table with 74.2% growth for the past 12 months, followed by Blue Sky Meats, up 50%, and South Port New Zealand, up 32.4%.
At a glance
The biotechnology sector experienced the largest loss of all the sectors on a percentage basis, down 19% due to Pacific Edge's poor performance during the quarter. This quarter's fall is the fourth for the sector in the past five quarters.
