Some of the ASX’s Kiwi plays have shut up shop due to the lockdown, but not seafood producers
Food & Agriculture
Food & Agriculture
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This week New Zealand entered a four-week lockdown. With residents unable to go out except for essential shopping and local exercise, what does this mean for Kiwi companies listed on the ASX?
While Australia has not gone to the extent of New Zealand, the nation has discouraged business as usual except for essential services. This is good news for the food producers, including the seafood specialists, which fall into the “essential services” category.
Earlier this week the company announced a $NZ4.4m ($7.3m) purchase agreement for the sale of 100 tonnes of its seafood. Organs such as fish bladder may sound hideous but it is considered a delicacy in its export markets.
“As a food producer we are considered an essential service,” executive director Aldo Miccio told Stockhead this morning.
“The country is in a lockdown as you know, but we are still making deliveries with skeleton staff and trying to do it with maximum care around health and safety.”
This morning King Salmon Investments (ASX:NZK) also told shareholders it was carrying on. While it reaffirmed its guidance, it admitted it would be a challenging period.
Telco infrastructure builder Chorus (ASX:CNU) has no choice but to defer much of its planned capital expenditure, but says it is still conducting typical daily activities.
In particular it is continuing to connect households to copper and fibre where either no broadband service exists or it’s just not good enough to work from home.
However it still reaffirmed its earnings guidance for the year ahead.
Earlier this week L1 Capital tipped Chorus for growth in the years to come because its network build was almost complete and would essentially be a monopoly.
On the flip side retailers have had to shut up shop, even their online distribution. Outdoor clothing and equipment retailer Kathmandu (ASX:KMD) told shareholders today it has done just this.
While other regions have also seen store closures, such as Australia and Europe, online retail has been continuing. But not in locked-down New Zealand.
While Adairs (ASX:ADH) is Australia-headquartered, it has a large presence in New Zealand and it has shut its stores.
The company said the re-opening was contingent on more than government direction, it would also look at the prevailing environment and it would be based on its own assessment.
The majority of its workforce was stood down but CEO Mark Ronan promised stores would be reopen as soon as it was safe.