Of particular note this week, Chorus reports this morning, Mercury and Tourism Holdings report tomorrow, Fairfax and Sky TV report on Wednesday and Air New Zealand and Meridian report on Thursday.
Two of the Government-controlled energy companies — Mercury and Meridian Energy — are likely to follow the lead of earlier companies to report and admit the wet summer and warmer weather had decreased demand.
Air NZ and Qantas report on the same day, a valuable comparison in two pivotal airlines for the region.
Also, the Sky Network TV/Vodafone merger decision is due on Thursday. Spark New Zealand is considering its next move after Sky said it would not delay a planned merger with Vodafone for a few days to allow for appeals if the deal received regulatory approval. The companies are set to create the country’s largest telecommunications and media group, with Sky TV buying Vodafone NZ for $3.44billion, funded by a payment of $1.25billion in cash and the issue of new Sky TV shares at a price of $5.40 per share. Vodafone becomes a 51% majority shareholder in Sky TV in what amounts to a reverse takeover. The pay-TV operator will borrow $1.8billion from Vodafone to fund the purchase, repay existing debt and use for working capital.
Forsyth Barr broker Suzanne Kinnaird will be watching Chorus’ results this morning for an earnings rebound from regulatory price changes.
Increased prices applied to Chorus’ copper products from December 16, 2015. Chorus estimated at its full-year result the increases would have added $59 million to its first-half 2016 result if the rates had been retroactively applied.
Chorus was expected to report an underlying profit of $318million for the six months ended December, up 16% on the previous corresponding period.
"This revenue and earnings rebound underpins Chorus’ dividend guidance of small increases each year from 2016. We expect a full-year dividend of 21c per share [cps]."
Chorus’ total fixed-line connections fell about 16,000 to 1.71million in the first quarter of the period and Ms Kinnaird expected a similar fall for the second quarter ended December.
While broadband numbers were up 3000 to 1.23million, those were a much lower service. Chorus had also noted it expected broadband growth to slow as rural opportunities started to fall and alternative solutions were pushed by the likes of Spark, she said. Forsyth Barr expected few surprises from Tourism Holdings (THL) when it reported tomorrow. THL was expected to report an operating profit of $37.4million for the period, up 17.2% on the pcp.
Points to watch included New Zealand’s tourism numbers leading rental business growth, capital base and management initiatives and El Monte integration commentary, Ms Kinnaird said.
"We believe strong demand has lifted yields and utilisation in THL’s core New Zealand rental fleet. Inbound tourism remains strong and therefore supportive to rentals growth."
The backdrop in Australia appeared more challenging as yields were below management expectations.
The introduction of Flex-Fleet in Australia, and growth in peer-to-peer rental van platform "mighway", would help drive a further lift in New Zealand and Australian return on capital throughout the financial year. At group level, systems would be aversely affected by the El Monte deal ahead of full synergy benefits being realised, she said.
Ebos was expected to report solid underlying earnings growth on Wednesday, although currency transactions would take some shine off the headline result.
Forsyth Barr was forecasting an operating profit of $120.7million for the December period, up 6.2% on the pcp.
Stronger growth was expected in the first half versus the second, given the benefit in December of a full period contribution from Red Seal and Onelink Australia, which started contributing from November 2015, Ms Kinnaird said.A solid result was expected from both healthcare and animal care divisions. Divisional mix and updated growth avenues were of interest, particularly in consumer products and pharmacy.
On Thursday, Port of Tauranga was expected to report an operating profit of $68.4million, up 6.1% on the previous year. The reported profit of $40.6million would be 5.4% higher than in the pcp.
"We expect the first half of 2017 to be the first half-year period since 2013 Port of Tauranga has enjoyed volume growth in both containers and logs."
Container growth would be driven by Maersk’s enhanced Triple Star service and Northern Star export cargo and volume gained from CentrePort’s earthquake-related challenges.
Logs had rebounded sharply, growing 26% according to export data, she said.
Higher-margin logs growth might help to offset the adverse margin mix impact of container growth. MetroPort containers, a key part of the port company’s growth and outlook, generated a lower margin for Port of Tauranga than its existing business mix.
Reporting calendar
Today: Bluescope Steel, Brambles, Chorus, Freightways, Ramsay Health.
Tuesday: BPH Billiton, Comvita, Heartland Bank, Mercury, Oil Search, PGG Wrightson, Seek, Tourism Holdings.
Wednesday: APA Group, Coca-Cola Amatil, Ebos Group, Fairfax, Fletcher Building, Healthscope, Pact Group, Sky TV, Stockland, Woodside, Woolworths.
Thursday: Air New Zealand, Cleanaway, Estia, Gentrack annual meeting, Meridian Energy, Port of Tauranga, Qantas, Sky/Vodafone decision, SLI Systems, Summerset, Trade Me, Vital Healthcare.
Friday: Link Group, CBL Corporation, Refining NZ, Vector, Vista.
