Barloworld Ltd. (BAW), the world’s biggest forklift trader, dropped the most in three years on speculation that a 75 percent jump in fiscal first-half profit doesn’t justify a rally in the stock this year.
Shares of Johannesburg-based Barloworld fell 8 percent to close at 87.50 rand in the city, the biggest one-day fall since Feb. 27, 2009. Before today, the shares had gained 26 percent this year compared with a 4 percent increase in the 162-member FTSE/JSE Africa All Share Index. (JALSH)
Earnings before one-time items rose 65 percent to 75 percent in the six months through March, Barloworld said in a statement today. Earnings a share increased 15 percent to 25 percent, lower than profit before items because of exceptional gains in the prior year, the company said.
“The shares have run hard,” Rhynhardt Roodt, an analyst at Cape Town-based Investec Asset Management, which manages more than $90 billion, said by phone. Comments from BHP Billiton Ltd. and Rio Tinto Plc that they may defer capital expenditure on their mines could also be hurting the stock. “People were certainly hoping for a higher number.”
While all operating units at Barloworld improved on their results from the prior period, the company incurred further reorganization costs at its Iberian unit, where “trading conditions remain very weak,” it said.