SkyCity Insider trading?

Written By: - Date published: 2:36 pm, February 18th, 2015 - 24 comments
Categories: national, winston peters - Tags: ,

From Radio New Zealand:

Stock exchange operator, NZX, has confirmed it is reviewing recent trading in SkyCity shares, following allegations about trading from New Zealand First leader, Winston Peters.

Mr Peters had wanted the Financial Markets Authority (FMA) to investigate what he said was an apparent surge in the share sales last Friday.

Mr Peters said Parliament had been told that the Government and SkyCity agreed on Friday the company would get no taxpayer money to build a convention centre in Auckland.

He said there was unusually heavy trading of the company’s shares that day, despite the absence of a public announcement.

FMA compliance director Elaine Campbell said the NZX had taken up the matter.

She said given the nature of the allegations being made, the authority would update the market when the NZX had completed its review.

Financial analysts have told Radio New Zealand that heavy trading was to have been expected, as Sky City has recently released its financial results.

The analysts said there was no major change in the share price or anything else irregular.

I have no time for Peters and his populist style of politics and I think any relationship between Labour and New Zealand First needs to be treated very carefully but on this issue Peters may have a point.

It is true that SkyCity had just released its six month financial results but my quick reading of the report does not provide any justification for the share price urging.  Earnings per share was down marginally and it was acknowledged that ongoing negotiations with the Crown over the Convention Centre posed some uncertainty for the company’s future finances.  From the report:

Group normalised revenue (including gaming GST) was up 9.2% to $510.0m. Normalised EBITDA was up 3.1% to $154.4m and normalised Net Profit After Tax (“NPAT”) of $66.6m was only up marginally on the previous corresponding period (“pcp”). Overall, the strong results of Auckland and IB were curtailed by the poor result of Adelaide

SKYCITY Auckland, our flagship property, was again the standout performer across the group, with normalised revenue up 17.2% to $302.5m and normalised EBITDA up 15.0% from $108.1m to $124.3m. This strong growth continues the positive momentum exhibited during 2H14, with growth across all business segments, delivering four consecutive quarters of EBITDA growth, on pcp

Some pointyhead accounting type may be able to explain why the figures are so good but to me they looked static and there is the uncertainty caused by the ongoing negotiations.

Yet there was a surge in the share price with it going up 0.15c on the 10th of February and another 6c on the 11th of February.  The sudden interest is clear from the graph.

SkyCity share price

So at a time you would think the share price would go down it went up.  And then the formal announcement was made.

On the 11th 956,000 shares were traded which was a figure higher than any previous figure for the past 30 days.

It will be interesting to see the results of the NZX investigation into the matter.

24 comments on “SkyCity Insider trading? ”

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  1. Murray Rawshark 1
    18 February 2015 at 3:26 pm

    I agree. Winnie can do some useful stuff now and then. He’s better when he points the investigators at something than when he hints at secret knowledge uniquely possessed by himself.

  2. Skinny 2
    18 February 2015 at 4:01 pm

    I would not be putting much trust in what the NZX has to say, their usually all in on ponzi schemes. I mean the NZX are fund managers too which looks questionable.

    Good on Peters for taking the heat off Little.

    • ScottGN 2.1
      18 February 2015 at 4:27 pm

      Worked a treat. And Winston went further when the Key made reference to the matter in QT today. He asked if the PM knew which of his caucus owed a much larger sum and why is he throwing stones?

  3. Tracey 3
    18 February 2015 at 4:45 pm

    If it went up before the announcement and then down after couldn’t that just be people “gambling” that Government would bail out SKYCity as was being signalled by Key?

    (I have no expertise in markets)

    I thought we couldn’t “short” or “long” shares in NZ which would be the only other explanation?

  4. Chooky 4
    18 February 2015 at 5:12 pm

    Winston Peters NZF is better and more effective in Opposition than the Labour Party ( who are more often than not, in boots and all with the Nacts)!

    ….good on Winston for asking the hard but obvious questions about SkyCity and insider trading !.

    ..and may Winston and the Greens and Mana take many more votes in the next Election…

  5. Anne 5
    18 February 2015 at 5:17 pm

    I have no time for Peters and his populist style of politics and I think any relationship between Labour and New Zealand First needs to be treated very carefully but on this issue Peters may have a point.

    Peters is for Peters and one has to be wary of his MoO, but every so often he hits the jackpot (example: Winebox Affair) and when it happens he’s gold. If it transpires he’s done it again then you can’t help admiring him for it.

  6. One Anonymous Bloke 6
    18 February 2015 at 5:22 pm

    It’s beyond stupid, the arrogance of people who benefit from money laundering. If Sky City and the National Party were content to simply take their cut of the money laundered through the casino, they’d be in like Flynn.

    On the other hand, I suppose the duped members require a sop to propriety from time to time, and an “investigation” will allay their concerns.

  7. whateva next? 7
    18 February 2015 at 5:40 pm

    I haven’t heard anything about this pretty dodgy at best report, but have heard plenty about Andrew Little’s late payment to a “poor worker”…no right of reply for Andrew, just “gotcha politics” to use National Speak

  8. Tracey 8
    18 February 2015 at 5:42 pm

    The thing about blind trusts is that if you choose your trustees based on the kow-towing to you, you can call them, they can do a transaction and you can claim you dont run the trust

  9. The Murphey 9
    18 February 2015 at 5:52 pm

    If you’re not inside the family you’re outside

    • One Anonymous Bloke 9.1
      18 February 2015 at 5:58 pm

      Profound, and yet anyone can play.

      If you’re not red, you’re blue. Unless you’re pink. Or yellow. Or pink and yellow.

      No other colours took part in that survey.

  10. les 10
    18 February 2015 at 5:59 pm

    Insider trading is the only game in town.The FMA is looked on with contempt by global traders.The NZX earned its ‘cowboy’ reputation in the halcyon days of the 80’s.

    • tc 10.1
      18 February 2015 at 8:53 pm

      NZX is run by the boys club who never bother enforcing what few rules they have and their purses just grew larger thanks to Shonkeys power flog off so all is sweet in fat cat land.

  11. felix 11
    18 February 2015 at 8:25 pm

    I go mainly by faces.

    And when I saw Key’s face in the house on Tuesday I thought “Now there’s a man who looks like he just made a packet on an inside trading scam and thinks got away with it.”

    Funny that.

    • Chooky 11.1
      18 February 2015 at 9:45 pm

      did you search the faces of Labour MPs as well?…especially those Nact friendly ones?

    • tc 11.2
      19 February 2015 at 7:32 am

      After Tranzrail and the farce that is blind trusts Shonkey can and does do as he pleases to increase his and mates wealth knowing he will never get caught out.

      Our general media are bad enough but the business media are complete lapdog sycophants pushing the corporate spin such as o’shillivan etc

  12. Old Mickey 12
    19 February 2015 at 11:14 am

    Winnie has a great batting average when it comes to calling smoke and fire.