Market News 6 July 2026

Johnny Lee writes:

Mainfreight (MFT) has provided its annual report to shareholders, outlining its targets and strategy for the next five years.

As always, the document begins with a brief thought piece from founder Bruce Plested. These have become a staple for the socially-inclined investment community, with the latest discussion focusing on the necessity of migration, specifically as a tool to ease pressure on our national superannuation affordability.

Mainfreight has long been one of our most “environmentally conscious” companies, using its financial success to invest in solar panels, battery storage, EV charging facilities, electric-based machinery and water collection. The management team are distinctly aware of their social license and have made real investments to ensure this is not placed into jeopardy, even going so far as to say their branches “are becoming both freight hubs and energy stations”.

Financially, the board is seeing rapid improvement throughout the year, after a disappointing 2025. The start of the 2027 financial year has seen some positive improvements, after a period of underperformance post-COVID.

The company also highlighted its increasing use of robotics in its warehousing division, and artificial intelligence in its analysis arm. 

Perhaps the most interesting part of the announcement was its five-year roadmap, which gives shareholders a glimpse into the current strategic direction of the company. While its current focus is largely on Australia, it has far more global ambitions long-term.

Included in this is a plan to structurally separate its airfreight network from the existing “Air and Ocean” division. It also includes an interest in expanding further into the Middle East, Africa and South America, eventually reaching 50 countries.

It also discussed a possible shift in its land acquisition strategy, moving from an “as-required” approach towards a land-banking one.

The last five years have been a long journey for Mainfreight. 2022 and 2023 saw a tremendous increase in revenue and profit, as freight costs soared following the COVID lockdowns around the globe. The company took a cautious approach to dividends at the time, with modest, sustainable increases that persist today. 

However, the last few years have seen a modest fall from these heights, with some regions underperforming, particularly in the Americas. The company is distinctly aware of this, and is taking steps, both strategically and with its capital expenditure, to address this. 

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Shareholders of carpet manufacturer Bremworth Limited (BRW), formerly Cavalier Corporation, have finally received notification of Commerce Commission clearance for Floorscape’s bid for the company.

Much like the Contact Energy takeover of Manawa, the Bremworth decision appeared to surprise the market, as it rallied sharply following the announcement, up 20% on the day.

Cavalier Corporation first listed in 1984, a somewhat famous year for NZX listings which included Rainbow Corporation and Charter Corporation.

Very few have survived to 2026. Bremworth’s departure, assuming the takeover proceeds, will leave only a handful from that era, including the likes of Hallenstein, EBOS and Sanford. This survival rate reflects perhaps not just how hard it is to build an enduring business model, but how rare it is for successful New Zealand companies to remain New Zealand owned.

However, another wrinkle in the plan has since emerged. 

Bremworth has made a subsequent announcement to market this morning. Some shareholders, represented by David Ferrier, intend to vote against the proposal. Mr Ferrier’s group represents an interest of around 19% of Bremworth, enough to prevent a mandatory acquisition. 

Minority shareholders of Bremworth should watch the market very closely over the weeks ahead.

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Tourism Holdings (THL) takeover is also progressing, although new twists are being introduced along the way.

Tourism Holdings received its first takeover offer in June 2025, with an indicative cash offer of $2.30 per share. The offer was from a group including Australian private equity firm BGH Capital, and the family interests of Luke and Karl Trouchet. Luke Trouchet was, at the time, a director of THL. He has since resigned from the role.

This offer was rejected by the board, expressing its view that the value of the company was “well north of $3 per share”, and that the offer was being made during a “bottom-of-the-cycle trading environment”.

In May of this year, Tourism Holdings received a revised offer from the same Consortium, at a price of $3.10 per share. So far, this was proceeding as shareholders would expect, with the board effectively negotiating on their behalf before providing a recommendation as to whether the offer represents a fair value.

Two weeks ago, an additional NBIO (Non-binding indicative offer) was received, this time at a range of $3.30 to $3.40. The buyer’s identity was not revealed, although Australian financial media believe the bid originated from a Portuguese RV rental company.

The bidders are now in the process of conducting due diligence, at which point the NBIO can proceed to a formal offer to buy the company.

These competing bids are always interesting to watch, especially when one side has acquired a meaningful holding. Rival bids tend to better shake out the “true” value of company, as bidders try to find a balance between securing acceptance and leaving themselves room to extract their own value following completion.

The winners, ultimately, will be the shareholders. The share price has climbed from $1.40 a year ago to $2.95 today, with the potential to go higher should either of the two offers proceed.

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The Reserve Bank of New Zealand (RBNZ) will meet on Wednesday to discuss our economy and decide the Official Cash Rate.

Market expectations are fairly mixed, with some expecting a 25-point hike to 2.50%, while others expect the Committee to hold, pending further data. Both arguments are compelling in their own right.

The rapidly evolving oil price story is driving much of these differences of opinion. Oil prices, and commodity prices that correlate with the oil price, have fallen sharply following the most recent announcement of a ceasefire.

Indeed, the previous decision saw significant commentary surrounding the conflict in the Middle East, and discussed the negative impacts this would have on our economic recovery and our inflation rates. Now, there are some (very) tentative market views that the conflict has ended and that the oil price is now in decline.

When expectations diverge like this, it increases the chance of a market move following the decision. Currency and swap markets will inevitably react, as one side – the wrong side – adjusts positioning.

The one consensus is that the current rate, of 2.25%, is too low. Longer term, interest rates will need to rise to a higher neutral rate – perhaps above 3% - and this week’s difficult decision may be the first step towards this point.

Travel

David Colman - Lower Hutt - 21 July

David Colman – Palmerston North - 22 July

David Colman - Whanganui - 6 August

David Colman - New Plymouth - 7 August

Johnny Lee

Chris Lee & Partners