Weekly Digest – 02 October 2024
Welcome to our Weekly Digest – stay in the know with some recent news updates relevant to business and the economy.
Decrease in number of SMEs going up for sale
The small and medium businesses that survived the pandemic by slashing costs are in a much stronger financial position when they come up for sale. Sales firm Link Business Brokers said it was seeing profitable, quality businesses on the market this year.
NZ Economy: Flicker of light
The BusinessNZ Planning Forecast for the September Quarter shows a flicker of light at the end of the tunnel. The BusinessNZ Economic Conditions Index, a measure of New Zealand’s major economic indicators, shows improvement from the previous quarter, with warmer business and consumer sentiment, reducing inflation, declining interest rates, small improvements in the health of the manufacturing and services sectors, and improved international prices for NZ dairy products among the positives.
New Zealand businesses fear disruption of American port strikes
Port strikes in the United States could cause major disruption for importers and exporters in New Zealand. Freight company C. H. Robinson’s Oceania Vice President Andrew Coldrey said the industrial action could make global shipping schedules unreliable and increase costs. He said that will flow through to New Zealand trade businesses.
Charities struggling to find volunteers amid financial crisis
Charities say they are struggling to find volunteers as people prioritise paid employment in the current financial crisis. A report by Volunteering New Zealand, which surveyed 420 organisations and 1500 volunteers, also noted a move towards casual volunteering of just a few hours a week.
Weather forecasting system review update
The Government has agreed in-principle for work to commence on bringing together the significant capabilities and resources of the National Institute of Water and Atmospheric Research Limited (NIWA) and the Meteorological Service of New Zealand Limited (MetService). In 2023 the Government commissioned the weather forecasting system review to determine the best approach to national weather forecasting in the future.
Financial crunch coming, Treasury’s Dominick Stephens warns
An ageing population, combined with higher-than-expected government debt and structural fiscal deficits, poses a major financial challenge for New Zealand, Treasury’s deputy secretary and chief economic adviser says.
How Fonterra’s finances have changed
Since Fonterra’s reset in 2018, which forced it to divest assets around the world, its debt levels have halved and its earnings per share have increased. The improvement has allowed the dairy co-operative to afford its second-largest annual dividend in its history of 55 cents per share, including a 15 cents special dividend.
Why can’t we get the kind of long-term mortgages with low break fees common in the US?
New Zealanders like a fixed-term mortgage – 90% of ours are locked in. But we tend to fix for short terms. In the US, 30-year terms are common, while here there is almost nothing fixed for more than five years. Most New Zealand lending will refix within the next year. So what’s going on, why don’t we get a 30-year fix option, and would we want one anyway?
Fletcher Building ‘a difficult collection of businesses to manage in its current form’
Fletcher Building is a difficult collection of building related businesses to efficiently manage in its current form, analysts with investment services firm Forsyth Barr say. And they say that after completion of the current capital raise, over the course of the past decade Fletcher will have raised $1.5 billion in capital from shareholders and sold $1.8 billion in assets, in order to fund $2.6 billion of ‘significant items’ and losses.
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