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| Weekly Commentary Archive | | For archival copies of the Weekly Commentary click here... | | | | 26th March 2010 | Insurance company Tower was demutualised in 1999 and listed on Australian and NZ stock exchanges the same year. In November 2006, Tower's New Zealand and Australian businesses were separated. Tower NZ is involved in general insurance and health and life insurance. The company's results for the first quarter to 31 December 2009 were better than those of the previous corresponding period's, but the insurance company nevertheless expects conditions to remain challenging over the next 6-12 months. Tower is highly regarded within the New Zealand insurance industry and by the share market as a whole. Difficult market conditions put the company to the test over 2008-9 but TWR's share price has increased steadily over the year. They are, however, short of their 52-week peak. TWR has from time to time mentioned the possibility of making an acquisition, but nothing has transpired to date. The company has weathered the economic storm of 2008-9, but is right to be cautious about the road ahead.
Later this month, herbicide maker Nufarm (Au: NUF) expects to post a loss of about $40 million for its first half, following on from what was a difficult year in 2008-9. But it was not all bad news, NUF shareholders have voted overwhelmingly in favour of Japan’s Sumitomo Chemical taking a stake of up to 20 percent in the company at a $14 a share, a hefty premium to the current market price. Most of NUF’s woes centre on the bottom falling out of the market for glyphosate, which is one of the world’s most commonly used weed killers and the key ingredient in the well-known brand, Roundup. Of the expected $40 million loss, about $33 million will represent material items including glyphosate trading impacts. Despite volatility in the prices of some of its key products, NUF is well placed to take advantage of increased investment in food production globally.
(Disclosure Statement: A disclosure statement can be obtained free of charge by calling IRG 0800 474669, or by email info@irg.co.nz.)
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