Market News 9 February 2026

Johnny Lee writes:

This week marks the beginning of February’s reporting season, which is shaping up to be an important one for New Zealand investors.

Skellerup is scheduled to be amongst the first and intends to publish its results this Thursday. Southport should be released on Friday.

Next week will see a number of our largest companies report, including A2 Milk, Contact Energy, Freightways, Fletcher Building, Spark, Sky City and Auckland Airport.

Spark’s result will be keenly anticipated. Spark has produced a string of poor results and enters reporting season with a share price close to 15-year lows. Expectations are not high. 

It will mark the first result since its SPK-30 strategy announcement last September. This new strategy would seek to refocus on core business – the provision of mobile services – and a shift away from non-core services.

Recent years saw Spark expand into (and exit out of) the likes of live sport, data centres and financing. Moving forward, the company expects a far simpler business.

This refocus is intended to produce “stable annuity-like returns… and growing dividends over time”. Shareholders and analysts alike will be keen to hear more about Spark’s plans to stabilise cash flow and provide greater predictability to future dividends going forward.

A key focus will be this dividend. The company has already flagged that future dividends will be tied to free cash flow, with 100% of this year’s free cash flow assigned to the dividend. In future years, the company has adopted a policy of 70% - 100% of free cash flow to fund the dividend, giving the company flexibility if opportunities arise, or expected future conditions necessitate the company holding on to its cash.

Another company in the spotlight is EBOS.

EBOS Group’s (EBO) share price has been heavily punished over the last six months and is our worst performing large cap over this timeframe. Despite this, it remains favoured by some analysts in the healthcare industry.

2025’s full year result surprised the market, with new CEO Adam Hall presenting the first full year result to include the loss of the Chemist Warehouse Australia contract.

2026 was framed as a year of transition rather than growth, notably one that would see the conclusion of both the distribution centre upgrades and the investment into this infrastructure. Specifically, EBOS expected a 30% reduction in capital expenditure following this completion. EBOS expects significant productivity benefits from these investments to ramp up in the years ahead.

More clarity on these benefits and internal expectations for 2027 will help stabilise the share price decline. At present, EBOS is trading like a yield stock, despite the investments it has made towards future growth. 

Reporting season starts on Thursday and will be a valuable opportunity for shareholders to evaluate the progress of their companies. Skellerup will open the season and help set the scene for the month ahead.

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One of the reasons why this reporting season is particularly interesting is due to the broader context of New Zealand’s economy.

The last few years have been marked by cautiousness and uncertainty, as listed companies grappled with a pandemic, geopolitical insecurity and an unpredictable interest rate environment.

Some recent data points to an economy beginning to rebound. Businesses remain confident in their short-term activity. Consumer confidence is now at its highest point in 5 years, and even dairy prices may be recovering.

However, inflation remains stubborn and unemployment has not yet stabilised. Last week’s data saw unemployment continue creeping modestly higher, largely due to an increase in the participation rate for the quarter. The employment rate actually rose alongside the unemployment rate, as more New Zealander’s sought work.

Maori and Pacifica continue to experience higher rates of unemployment, while the gap between men and women remains modest, at around 0.3%.

Positive outlooks from our corporate sector, particularly among the exporters, would provide a clearer picture. The likes of Fletcher Building, Freightways, Auckland Airport and Port of Tauranga will provide a broad spectrum of New Zealand’s economy, helping investors achieve a better understanding of what companies are seeing at the coal-face, and what investments they intend to make in response.

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David Colman writes:

Ryman Healthcare (RYM) released its refreshed strategy, new capital management framework and dividend policy at its Investor Day for investors and analysts on Tuesday.

RYM Chief Executive Officer Naomi James described the business as “uniquely placed with capacity and flexibility to meet the fastest growing areas of demand in care and assisted living.”

The retirement village owner and operator provides a continuum-of-care model offering residents a ‘home for life’ with the goal of keeping residents connected and supported as their needs change.

Plans for the business include continuing to evolve its offering and leverage its scale, seeking to provide more choice for residents with the intent of simultaneously improving long-term returns for its shareholders.

Ryman is targeting $150 million in sustainable cash flow improvement by Full Year 2029, ambitiously at the top end of the previously announced range. This is expected to be driven by growing occupancy rates, reset pricing and cost efficiencies.

A target of $500 million of cash released by Full Year 2029 has been set.

The funds are intended to come from new and paid out resale stock and at least $200 million from the sale of sites identified as land not required for immediate development.

Ryman’s landbank review concluded that six sites will be retained for potential development with a preference to Australia for greenfield investment (developing new facilities) with New Zealand representing stronger brownfield (expanding existing facilities) opportunities.

The refreshed strategy will focus on growing recurring earnings from Ryman’s $12 billion portfolio spread across New Zealand and Australia and positioning the business to return to value-creating portfolio growth.

Chair Dean Hamilton noted that the board’s top priority is to deliver a sustainable return on RYM’s existing asset base, and described the balance sheet reset as now complete, allowing the renewed pursuit of disciplined growth over time.

Full Year 2027 will focus on prioritising the best development opportunities across the portfolio.

The new capital management framework outlines a path to return to sustainable dividends in FY28 targeting a payout policy of 20-50% of cash flow from existing operations (CFEO) per share.

The company noted that the doubling of the 80+ population by 2050 will create scarcity in care and assisted living, increasing the value of Ryman’s existing capacity.

A material uplift in DMF (Deferred Management Fees) and weekly fees is expected as old contracts conclude and new ones are signed - approximately half of the portfolio is expected to be on new DMF terms by FY29.

Higher occupancy rates and a reset in care accommodation pricing are expected to drive a target uplift in aged care EBITDAF per bed from approximately $15,000 currently to $25,000 to $30,000 by FY29.

RYM’s FY26 ORA (Occupational Rights Agreements) sales guidance remains unchanged at 1,300 to 1,400 which remains below recent years (1,574 in FY24 and 1,523 in FY25).

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Briscoes Group (BGP) released its fourth quarter sales to 25 January 2026 which included record fourth quarter group sales of $256.6 million (up 4.58%) with Homeware up 3.45% and Sporting Goods up 6.46%.

The record quarter helped the company achieve record full-year Group sales of $798.8 million, up 0.93% - Homeware up 1.42%, Sporting Goods up 0.13%

The online business continued to improve with online sales at 20% of total Group sales for the first time, up from 19.69% last year.

Group Managing Director, Rod Duke described a highly competitive retail environment and that company initiatives such as promotions and trading opportunities helped improve margin and sales growth (+1.95%) and he expects the full year Group gross profit margin to be close to 39.20%. Margin decline was slowed for the second half to around 75 basis points versus 154 basis points for the first half.

The company expressed a commitment to rigorous management of inventory and costs with closing inventories to be at least $5 million below last year and total store and overhead costs increasing less than 1.5% over the last year

Despite persistent pressure on consumer sentiments and discretionary spending the company’s homeware and sporting goods segments returned positive sales growth for the full year even after earlier tracking below the prior year.

The group opened a new flagship Rebel X store at the end of November, following a refresh of its existing Panmure Rebel Sport site and noted that customer and supplier feedback has been overwhelmingly positive, and sales continued to build since opening.

Interest income for the year is expected to be $3.2 million less than last year due to a lower cash holding and lower interest rates.

The new Drury distribution centre remains on schedule and within budget.

The fourth quarter performance is viewed as encouraging with an economic recovery and consumer confidence crucial for the company to sustain momentum.

BGP has been an incredibly resilient retail leader in New Zealand and the expected full-year net profit after tax (NPAT) is to be in the range of $59 to $60 million

The Group is expected to report its full-year result, including announcement of final dividend, on Wednesday 11 March 2026.

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The Reserve Bank of Australia (RBA) hiked rates last week with a 25 basis points increase to the Australian OCR (Official Cash Rate) to 3.85%.

Inflationary pressure has increased recently with the Australian CPI (Consumer Price Index) rising since mid-2025 to 3.8%, and the RBA’s measure of underlying inflation creeping up to 3.3%, for the year to December.

The above data raised concerns that inflation could continue to climb away from the 2% to 3% target range pushing the RBA to act with its first OCR increase in over two years.

The RBNZ provides an update on the New Zealand OCR on Wednesday 18 February which will have to factor in the local CPI update in late January that at 3.1% is above the inflation target of 1% to 3%.

The update will be the first that the Reserve Bank Governor Dr Anna Bremen will have helped to prepare after being appointed in December last year.

If the RBNZ has similar inflation concerns to the RBA then the NZ OCR might be raised in the first half of this year (perhaps in April or May) noting the next CPI update is in late April. This would tend to affect short term rates.

Underlying bank rates (both short term, and longer term, swap rates) have been rising for months and the ANZ raised its 5-year term deposit rate to 4.50%p.a. last week which is a sign that lower borrowing rates are not expected in the longer term and that the yield curve is very much back to normal (lower rates for shorter terms versus higher rates for longer terms).

Notably, ANZ, as a major local AA- rated bank now offers a higher 5 year term deposit rate than lower rated (including BBB or less) deposit takers – this is perhaps a consequence of the newly established Deposit Compensation Scheme’s $100,000 limit per depositor enticing wealthy depositors to spread their deposits more broadly (reducing deposits held at ANZ and other AA- rated banks and increasing deposits with smaller, lower-rated banks and non-bank deposit takers, covered under the scheme).

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Travel

12 February – Lower Hutt – David Colman

18 February – Christchurch – Johnny Lee

2 March – Christchurch – Chris Lee

3 March(am) – Christchurch – Chris Lee

3 March(pm) – Ashburton – Chris Lee

4 March – Timaru – Chris Lee

6 March – Wanaka – Chris Lee

12 March – Nelson – Edward Lee

Johnny LeeChris Lee & Partners Limited