What is driving CRP, THL, SPY on NZX?

  • Jun 05, 2020 NZST
  • Team Kalkine
What is driving CRP, THL, SPY on NZX?

Summary

  • New Zealand is the first country to report no new COVID-19 case in last 13 days which shall help implement Level 1 guidelines, earlier than scheduled
  • Smartpay and CRP are few of the lucky companies to be less impacted by the coronavirus outbreak. Their current financial needs are taken care of by new and existing investors which are showing their support by feeding in money through private placements and Share Purchase Plan route.
  • The tourism industry is one of the worst hit because of COVID-19, forcing companies like Tourism Holdings to restructure their business and try seeking Job subsidiary to help its employees.

In the past 13 days, New Zealand has not registered a single new case of COVID-19. In one of the press conferences on 2 June 2020, the prime minister of New Zealand, Jacinda Ardern announced that the country would ease restrictions to reach Level 1 by next week.

New Zealand’s cabinet would be accessing the alert level setting earlier than planned on 8 June 2020 only if there are no further unexpected cases.

On 28 February 2020, the country reported the first coronavirus case and on 14 March 2020, there were six cases of COVID-19. At that time, Jacinda Ardern imposed strict guidelines on those entering the nation to isolate them for two weeks.

During this period, companies into non-essential services were adversely impacted while the ones providing essentials had a neutral or positive impact of COVID-19 as they used this as an opportunity to meet their strategic objectives.

With the gradual ease in restriction, the focus for the entire country would now be a smooth shift towards resuming and revamping the economic losses owing to COVID-19.

On that note, let us look at some NZX listed companies with their recent development and stock performance.

Chatham Rock Phosphate (NZX: CRP)

Chatham Rock Phosphate (NZX:CRP), listed on Toronto Venture Exchange and the New Zealand Alternative Market, is an exploration and development company that aims to become a diversified phosphate developer and trader. Chatham Rise seabed, east of New Zealand, is where the Company’s phosphate rock located. CRP holds an official mining permission to extract phosphate from an offshore area in Chatham Rice.

Recently on 25 May 2020, the Company released its quarterly results which had a positive impact on its share price. The shares have reached a level that prevailed during August 2019.

By market closure on 5 June 2020, CRP shares settled at NZ$0.235, up 2.17% from its previous close.

Let us look at the quarterly update of CRP:

  • COVID-19 pandemic did not have any significant impact on company’s operations or any of its team.        
  • There were various advancements made by the Company which includes financing success, strategic alliances in Canada, and a useful transformation in the permitting ground-swell in NZ.
  • Other than this, the Company is also exploring for some other phosphate assets, with 5 prospecting licence applications over marine phosphate rich deposits offshore Namibia, so that it can broaden its portfolio and reduce the significance of the apparent binary permitting risk linked with the Chatham Rise project.

Successful Private Placement in May 2020:

In early April 2020, the Company completed a private placement and raised CAD$402,385.60 by issuing 5,029,820 units at CAD$0.08 per unit to maintain a good position as it pursues its planned goal of confirming a new investor. The new investor can finance the environmental permit re-application, which continues to move ahead.

The Company announced another non-brokered private placement of up to CAD $1 million, issuing 12,500,000 units at a price of CAD $0.08 per unit, with Stockhouse to utilise its global reach and attain the Company’s target.

Strategic Partnership with Stockhouse and Venture Ad Network:

Following the completion of the 2 private placements, existing investors Stockhouse and Venture Ad Network will have under 10% stake in CRP. The company finds the choice of these powerhouses based out of Canada to invest in CRP quite inspiring & in line with their decisions to encourage and raise the company’s profile in the global market. The company believes that the results of working with these two companies will improve the online presence as well as awareness of its rock phosphate project.

Tourism Holdings Limited (NZX:THL)

Tourism Holdings Limited (NZX:THL) is a premier tourism company in New Zealand and is the largest provider of holiday vehicles for rent and sale globally. The company functions in Australia as well as New Zealand under rentals brands such as Britz, Mighty, and maui as well as the RV Super Centre and RV Sales brands. THL is also 50:50 partner with Thor Industries Inc for Togo Group.

THL shares from 25 May 2020 has seen a significant jump in its share price after the release of the update from the company related to commencement of the NZ restructuring process.

By the market closure on 5 June 2020, THL shares increased by 0.43% from its previous close and ended the day’s session at NZ$2.350.

On that note, let peek into the restructuring process of THL.

NZ restructuring process:

Because of the COVID-19 restriction, the company experienced an impact on its business globally. Its US business made staffing deviations in April 2020 while the Australian business is using the 6 months JobKeeper subsidy & assessing continuing crew structures. In New Zealand, the company was seeking alternate revenue because of the enactment of COVID-19 restriction and also accessed the COVID-19 Wage Subsidy plan to assist its people.

On 26 May 2020, the company began the consultation process under which it engaged staff from Waitomo, Kiwi Experience and group support. Approximately 140 people are anticipated to be impacted from the modifications in these businesses. The response to the large-scale motorhome rental campaign in New Zealand significantly exceeded expectations and initial campaign goals. With this, the company is now engaged in assessing resourcing for its Rentals & Sales business and any possible modifications that may be needed.

SmartPay Holdings Limited (NZX:SPY)

SmartPay Holdings Limited (NZX:SPY) is an innovative merchant services company. It is a digital platform, provides merchants with the latest technology which helps them advertise themselves better, save costs, and increase their revenue. SPY brings them a variety of services that is unparalleled by any other single company.

On 5 June 2020, SPY shares settled at NZ$0.595, down 0.83% from the previous close.

Capital Raising:

The company has recently completed A$13 million placement by issuing 30,952,381 new fully-paid ordinary shares at an issue price of A$0.42 per share. On 2 June 2020, the company announced the opening of A$2,000,000 non-underwritten share purchase plan. Under the share purchase plan, the eligible existing shareholders of the company would be able to receive their application forms to apply for up to a maximum of NZ$32,200 or AU$30,000 of new shares per shareholder. Each share would be issued at the same price as that of the placement, which is A$0.42.

The fund raised would support the company to capitalise the business for growth in both the Australian and NZ markets as well as strengthen the balance sheet via debt reduction.

 


Disclaimer
The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. The above article is NOT a solicitation or recommendation to buy, sell or hold the stock of the company (or companies) under discussion. Kalkine does not in any way endorse or recommend individuals, products or services that may be discussed on this site.

 

   
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