Gentrack, which is making a $20m share buy-back, said it now expected half-year operating earnings (ebitda) of $7.8m and full-year ebitda of $13.5m-$20m – well below the market’s expectations of $15.9m and $34m, respectively.
Half-year revenue is expected to be $110m, below the market expectation of $123m, and the full-year between $229m and $238m, with recurring revenue growing 10% to around $174m. Non-recurring revenue would be lower than in the previous year.
“With strong recurring revenue growth, we expect margins to improve to our medium-term target of 15% to 20% ebitda margin,” Gentrack said.
“We stand by our medium-term revenue target of more than 15% compound annual growth rate. We have taken the strategic decision to prioritise growth and global leadership over short-term ebitda.”
Shane Solly, portfolio manager with Harbour Asset Management, said Gentrack’s project pipeline hadn’t come through. The earnings downgrade was quite significant, and the market reacted aggressively.
The market was also led lower by the transport and logistics companies Mainfreight, which declined $2.10 or 3.41% to $59.40, and Freightways, which shed 30c or 2.25% to $13.05, after Amazon said it was opening up its supply chain to all shippers.
Solly said the move would likely create a shake-down in the global sector, with Amazon competing with the likes of Mainfreight and other transport businesses.
Across the Tasman, the Reserve Bank of Australia, as expected, increased its cash rate by 25 basis points to 4.35%, saying inflation is likely to remain above target for some time.
Higher fuel prices are adding to inflation, and there are indications this is likely to have second-round effects on prices for goods and services more broadly, the bank said.
The S&P/ASX 200 Index was down 0.24% to 8,678.3 points at 6pm NZ time.
In the US, the Dow Jones Industrial Average tumbled 550 points, or 1.13%, to 48,941.9 points, as oil prices rose and investors feared the Iran conflict could intensify again.
The S&P 500 was down 0.41% to 7200.75 points, and the Nasdaq Composite eased 0.19% to 25,067.8. Brent Crude oil was trading at US$113.50 ($193.42) a barrel.
Local stocks
At home, Fisher & Paykel Healthcare was down 30c to $36.50; Ryman Healthcare decreased 5c or 2.25% to $2.17; Oceania Healthcare declined 1.5c or 2.01% to 73c; and Vulcan Steel shed 21c or 3.l3% to $6.15.
Another transport stock, Move Logistics, fell 1.5c or 6.38% to 22c, and Blackpearl Group declined 2.5c or 3.14% to 77c.
Contact Energy, which presented at the Macquarie conference, was up 9c to $9.79; a2 Milk gained 9c to $8.14; Ebos Group increased 38c or 1.77% to $21.80; Tourism Holdings rebounded 9c of 4.48% to $2.10; Vista Group improved 4.5c or 2.37% to $1.94; and ikeGPS rose 7.5c or 6.2% to $1.28.
Meridian Energy, unchanged at $5.80, becomes the only New Zealand company included in the S&P’s Dow Jones Best-in-Class World Index – a global measure of corporate sustainability performance and ranking in the top 10% of utilities worldwide.
Westpac decreased $1.76 or 3.72% to $45.50 after reporting a “slightly disappointing” 5% increase in half-year revenue to A$11.29 billion ($13.7b) and net profit of A$3.4b, up 3% on the first half of the 2025 financial year and down 5% on the second half.
The transtasman Banking Group said balance sheet momentum was solid, with both lending and deposit growth of 7% over the year.
ANZ was down 41c to $43.90 after the High Court ruled in 2015 and 2016 that some of its lending breached the Credit Contracts and Consumer Finance Act and that customers should be paid all the interest on their loans.
ANZ estimated it could cost as much as $125m, depending on how the judgment is applied to the 17,000-odd people captured by the class action.
Transport and logistics software firm Trade Window, up 1c or 5.26% to 20c, reported a 20% rise in revenue to $9.6m for the year ending March, with annual recurring revenue increasing 17% to $10.1m compared with the previous year.
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