Steel & Tube Holdings Ltd. fell the most in 34 months in Wellington trading after the New Zealand distributor of reinforcing mesh and wire said first-half profit will decline because of subdued construction.
Net income will be between NZ$6 million and NZ$7 million in the six months ending Dec. 31, from NZ$8.4 million a year ago, Chief Executive Officer David Taylor said in notes for a speech to the annual meeting in Wellington today. The stock fell 7.9 percent to NZ$2.21 as of the 5 p.m. market close, the biggest decline since Jan. 9, 2009.
The first four months of the financial year have been “difficult” because of low activity levels and increased competition, Taylor said. Residential and commercial construction deteriorated while raw materials prices are high and unlikely to drop substantively, he said.
Trading improvements are also likely to be limited in the second half of the year because of global conditions in the steel markets and an expected delay in the start of rebuilding earthquake-devastated Christchurch until after June next year, he said.