Latest / Best of Business / Jeremy Hutton: Milford Asset Management expert on when we can expect to see the economy recovering

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Jeremy Hutton: Milford Asset Management expert on when we can expect to see the economy recovering · Best of Business

• 0:09
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• 0:17
  Speaker 1: Here the Duplicy Ellen.
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  Speaker 2: I've just lost another wicket. Captain Kaine is out. I'll
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  Speaker 2: get you the details and to take eighteen past six.
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  Speaker 2: Jeremy Hutton, Wilfed Asset Management is with us a Jeremy.
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  Speaker 3: Good evening, Heather.
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  Speaker 2: Now, as we know, the economies had a few tough years,
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  Speaker 2: hasn't it. But are we finally starting to see the
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  Speaker 2: start of hard data improvements coming through?
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  Speaker 3: Yeah, that's right. A lot of the economic improvements so
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  Speaker 3: far has been in the more soft data, so this
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  Speaker 3: is more feeling and surveys and you know, people indicating
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  Speaker 3: that next year they'll probably will feel a bit better
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  Speaker 3: or spend some more money. But some of the harder
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  Speaker 3: data is starting to come through too, which is good
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  Speaker 3: and confirms that positivity. And one such story today is
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  Speaker 3: on the insed X. We had a non agri business
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  Speaker 3: upgrade their earnings forecast and that was in Z to
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  Speaker 3: me and a company you will know very well. But pleasingly,
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  Speaker 3: it was the revenue line which contributed to the beat
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  Speaker 3: or the upgrade and earnings and you know, we know
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  Speaker 3: that media and advertising can be at the point end
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  Speaker 3: of the economy, and we know firms have cut back
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  Speaker 3: materially on advertising spend where the demand has been quite weak.
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  Speaker 3: So perhaps in me's upgrade is indicating that there's a
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  Speaker 3: little bit more spend, a little bit more activity going
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  Speaker 3: on in the wider economy.
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  Speaker 2: Some jobs data improving too from Stats New Zealand.
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  Speaker 3: Yeah, Stats New Zealand. Yesterday they had their fulled jobs data.
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  Speaker 3: This is effectively all the jobs in the New Zealand
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  Speaker 3: economy and that's increased for two months in a row.
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  Speaker 3: You know, not maybe not quite a trend, but you know,
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  Speaker 3: getting better, and it is good that the economy is
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  Speaker 3: starting to add some jobs again. I'd also note that
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  Speaker 3: in terms of activity is house sales volumes, so you know,
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  Speaker 3: this is activity and liquidity in the market has been
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  Speaker 3: pretty consistently increasing each and every month this year, so
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  Speaker 3: more activity in the housing market. But I would just know,
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  Speaker 3: you know, we are coming off the bottom, so there
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  Speaker 3: is still certainly a way to go here.
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  Speaker 2: Now, listen on this restaurant brand takeover offer. Do you reckon?
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  Speaker 2: The Independent Value Report is going to disappoint some of
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  Speaker 2: the some of the shareholders.
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  Speaker 3: Yeah, potentially. You know fin Access there are Mexican private
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  Speaker 3: equity owner or investor. They've owned seventy five percent of
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  Speaker 3: restaurant brands for about seven years now, and they submitted
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  Speaker 3: a takeover offer for the remaining twenty five percent of
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  Speaker 3: the business and they want to take it private and
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  Speaker 3: take it off the listed market. And you know, on
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  Speaker 3: face value, their offer was pretty attractive. It was five
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  Speaker 3: five dollars and five cents and that was a big
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  Speaker 3: seventy percent premium versus what the share price was before.
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  Speaker 3: But the company has had a really disappointing few years.
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  Speaker 3: The share price has fallen eighty percent over the past
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  Speaker 3: few years, so, you know, a tough going for shareholders.
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  Speaker 3: But the independent value report that came out yesterday as well,
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  Speaker 3: and the midpoint actually indicated a value of five seventy
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  Speaker 3: two so obviously a lot more than what finn Access
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  Speaker 3: is offering. So perhaps there getting that remaining twenty five
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  Speaker 3: percent a little bit cheaply and some New Zealand investors
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  Speaker 3: could be missing out here.
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  Speaker 2: Have we seen any impact from the CGT proposal?
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  Speaker 3: Yeah, not too much at this point. I mean, your
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  Speaker 3: mind goes to say the listed real estate companies or
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  Speaker 3: the retirement companies that could be impacted. You know, the
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  Speaker 3: retirement one's an easier one. You've had the bright line
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  Speaker 3: test for a few years. We've had various proposals of
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  Speaker 3: capital gains and retirement's always been excluded from those, So
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  Speaker 3: imagine that would be the same for Labour's twenty twenty
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  Speaker 3: seven tax. But reats you know some impact. New Zealand
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  Speaker 3: does have a key differential currently with Australia and property
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  Speaker 3: for investors. You know, we don't have capital gains tax
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  Speaker 3: or stamp duty or land taxes, so perhaps one of
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  Speaker 3: our relative attractiveness points has gone there. But you know,
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  Speaker 3: rets they do deliver some of their gains through share
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  Speaker 3: price appreciation and that is obviously excluded. So you know,
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  Speaker 3: there is some attractiveness to the listed rates and your
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  Speaker 3: investors want that property exposure. It could be better than
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  Speaker 3: incurring a capital gains tax on a direct property investment.
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  Speaker 2: Interesting. Hey, thank you very much. Jeremy has always appreciated
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  Speaker 2: Jeremy Hutton, Wilford Asset Management.
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