Yovich & Co. Market Update - 1 December 2021

Nov 30, 2021 | Commentary

Yovich & Co are excited to welcome their new Financial Adviser Brock Fannin. Brock has come from BNZ where he worked as a Commercial Senior Associate, and prior to that as a Senior Data Analyst at the Ministry of Education. He has previous experience as an Investment Adviser at Craigs Investment Partners and holds a Bachelor of Commerce from the University of Otago, majoring in Finance and Economics. Brock was born and raised in Whangarei, where he now lives with his wife Nicola and their 8-year-old daughter Brielle.

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In summary, the NZX50G had 32 companies on the downside, 3 companies unchanged and 15 companies were on the upside. Last Friday saw the NZX50G decreased by 1.6% but by day end clawed back to be down 1.30% (217 points). These market movements were due to the announcement of the new Omicron which spooked investors. Omicron also was the cause of the NZD depreciating as currency trades ditch riskier currencies in favour of safe haven currencies such as USD. As expected, the RBNZ increased the OCR to 0.75, a 0.25 basis points increase. The US markets did a flip flop Monday, as stocks climbed and bonds fell as a relative sense of calm returned to global markets, with investors reassessing their worst-case scenarios for the omicron coronavirus strain.

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Investment News

Serko Limited (SKO.nz)

A leader in online travel booking and expense management for business, is pleased to announce the successful completion of its NZ$75 million placement. The Placement was fully subscribed at the price determined in the bookbuild of NZ$7.05 per share. This represents a 10.2% discount to the closing price of NZ$7.85 on 23 November 2021% respectively. Eligible retail Serko shareholders at the record date of 23 November 2021, are eligible to apply for up to a maximum of NZ$50,000/A$46,500 of new shares per shareholder. The price of these shares will be the lower of NZ$7.05, or the five-day volume weighted average price of Serko shares traded on the NZX during the last five days of the Retail Offer period.

Current Share Price: $6.40, Target Price: $8.24.

NZ Refinery (NZR.nz)

Advises that it has successfully completed a $39.0 million underwritten placement (Placement), which forms part of the equity raising to fund growth through private storage services. The Placement was underwritten at a floor price of $0.82. per share, representing a 5.7% discount to the closing price of $0.88 on 26 November 2021. The $5 million share purchase plan (SPP) component of the capital raising will open on 2 December 2021. Eligible shareholders on the record date (26 November) can apply for up to NZ$15,000 of new shares in Refining NZ at $0.82 and/or a 2.5% discount to the volume weighted average price of Refining NZ shares traded on the NZX during the five trading days up to, and including, the end of the SPP offer period.

Current Share Price: $0.87. Target Price: $1.11.

Sheffield Resources (SFX.asx)

Is pleased to advise that it has entered into a definitive and binding agreement with Image Resources NL (Image) (ASX: IMA) for the sale of its 100% owned Eneabba Project for total cash consideration of $24 million. Cash consideration of

$23m is subject to customary conditions associated with the transfer of exploration tenements and the $1m balance is payable subject to the transfer of mining tenements, Foreign Investment Review Board (FIRB) approval and other customary conditions. The transaction is expected to close in early 2022. Cash proceeds from the transaction will be applied toward Sheffield’s $10m obligation to Kimberley Mineral Sands Pty Ltd (KMS) payable within 60 days following a Final Investment Decision for the Thunderbird Mineral Sands Project as well as general corporate purposes. Sheffield Executive Chairman, Bruce Griffin, said: “Sheffield is very pleased to have realised meaningful value for our non-core Eneabba Project, consistent with Sheffield’s strategy of focusing on our core Thunderbird asset. It is particularly pleasing to be able to divest Eneabba to Image given the strong alignment of these assets to their growth strategy.”

Current Share Price: $0.38, Target Price: $1.45.

Oceania Healthcare (OCA.nz)

Announced unaudited proforma Underlying Earnings before interest, tax, depreciation, and amortisation (EBITDA) of $36.5m for the six-month period ended 30 September 2021, a 19.7%, ($6.0m) increase on the six-month period ended 30 September 2020.  The Aged care business continued to perform well throughout the period despite COVID- 19 disruptions.

Sales volumes (for both independent living apartments and villas, as well as care suites) being 10.6% ahead of the six-month period ended 30 September 2020. Acquisition of Waterford (Hobsonville Point, Auckland) in April 2021 and a resource consent for 50 independent living apartments and a basement carpark has been secured and completed. Along with the completion of 49 apartments at Eden (Auckland) in April 2021 and eight villas at Gracelands (Hastings) in September 2021. Oceania’s total assets are now $2.1b, representing 9.7% growth since 31 March 2021.

Current Share Price: $1.31, Forecasted dividend yield: 3.82%, Target Price: $1.71.

Upcoming ex-dividend payments

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About the author

Nathanael McDonald

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Serko Limited NZ Refinery Sheffield Resources Oceania Healthcare KiwiSaver Investments Share Trading Shares Nathanael Mcdonald Walter Yovich Jarrod Goodall Share Advice


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