New Zealand Professional Investment Services Firm, Forsyth Barr

Forsyth Barr

New Zealand Professional Investment Services Firm

We are proud to be a New Zealand owned firm, with 21 offices throughout the country and over 300 employees. We assist personal, institutional and corporate clients providing a full range of investment services.

Forsyth Barr is a foundation New Zealand Exchange firm (NZX) and accredited market participant. We have been confirmed by the Financial Markets Authority as a Qualifying Financial Entity (QFE).

Research is the cornerstone of our advice. We have one of New Zealand's leading teams of analysts. Our global affiliations ensure comprehensive research coverage of all major investment markets.

Equity Bottom-Up

Meridian Energy Ltd. operates as a state-owned electricity generator. The Company produces hydro-electric power and supplies electricity to residential, business, and rural customers. Meridian Energy provides services throughout New Zealand.

<ul><li>March 2025 saw dry conditions with declining hydro levels and rising electricity prices, but short-dated futures prices fell, indicating effective dry year mitigations.</li><li>Gas production volumes are decreasing, posing challenges for winter 2026, although the sector has increased reliance on coal and added new generation capacity.</li><li>Electricity stocks offer good value and attractive yields, with MCY and MEL rated OUTPERFORM, while CEN, GNE, and MNW are rated NEUTRAL.</li></ul>

March 2025 saw dry conditions with declining hydro levels and rising electricity prices, but short-dated futures prices fell, indicating effective dry year mitigations.Gas production volumes are decreasing, posing challenges for winter 2026, although the sector has increased reliance on coal and added new generation capacity.Electricity stocks offer good value and attractive yields, with MCY and MEL rated OUTPERFORM, while CEN, GNE, and MNW are rated NEUTRAL.

Power Points Keep Calm and Power On—April 2025

Thematic (Sector/Industry)

<ul><li>The Property sector accounts for around 37% of global carbon dioxide emissions, with variations in sustainability progress across New Zealand's listed property companies.</li><li>Disclosures broadly meet regulatory requirements but often lack a clear narrative on how climate risks and opportunities may affect future outlooks.</li><li>Greenhouse gas inventories reflect the maturity of reporting practices more than climate transition risks, with inconsistencies in Scope 3 emissions reporting.</li></ul>

The Property sector accounts for around 37% of global carbon dioxide emissions, with variations in sustainability progress across New Zealand's listed property companies.Disclosures broadly meet regulatory requirements but often lack a clear narrative on how climate risks and opportunities may affect future outlooks.Greenhouse gas inventories reflect the maturity of reporting practices more than climate transition risks, with inconsistencies in Scope 3 emissions reporting.

Insights from Climate Disclosures Property Sector

Auckland International Airport / Equity Bottom-Up

Auckland International Airport Limited owns and operates the Auckland International Airport.  The Airport includes a single runway, an international terminal and two domestic terminals.  The Airport also has commercial facilities which includes airfreight operations, car rental services, commercial banking center and office buildings.

<ul><li>Auckland Airport (AIA) is downgraded to UNDERPERFORM from NEUTRAL due to Commerce Commission's review of PSE4 pricing period.</li><li>Key negatives include targeted excess profits, ignored non-priced services, and potential regulatory scrutiny.</li><li>Market consensus earnings expectations are optimistic and need moderation; AIA is not considered cheap at the current trading multiples.</li></ul>

Auckland Airport (AIA) is downgraded to UNDERPERFORM from NEUTRAL due to Commerce Commission's review of PSE4 pricing period.Key negatives include targeted excess profits, ignored non-priced services, and potential regulatory scrutiny.Market consensus earnings expectations are optimistic and need moderation; AIA is not considered cheap at the current trading multiples.

Auckland Airport Another ComCom Speeding Ticket

Kathmandu Holdings Ltd. provides clothing and equipment for the travel and adventure market. The Company operates retail locations throughout Australia and New Zealand.

<ul><li>The sales downgrade cycle is nearing an end, particularly in the direct-to-consumer (D2C) channel, with 2Q25 sales up 7% year-on-year in both Kathmandu and Rip Curl.</li><li>Investment in Kathmandu's brand and product range is yielding early results, delivering structural growth beyond a cyclical recovery.</li><li>Wholesale destocking appears to be behind us, with early 1H26 orders pointing to year-on-year growth.</li></ul>

The sales downgrade cycle is nearing an end, particularly in the direct-to-consumer (D2C) channel, with 2Q25 sales up 7% year-on-year in both Kathmandu and Rip Curl.Investment in Kathmandu's brand and product range is yielding early results, delivering structural growth beyond a cyclical recovery.Wholesale destocking appears to be behind us, with early 1H26 orders pointing to year-on-year growth.

KMD Brands 1H25 Result—Finding a Foothold

Turners Limited specialized personal insurance. The Company provides motor vehicle and personal financial services, and hire purchase services and investment advisory services to businesses.  Dorchester also provides immigration consultancy services assisting business migrants and families.

<ul>
<li>Turners Automotive (TRA) has delivered top-quartile earnings growth and consistency in the NZ market over the past nine years.</li>
<li>TRA trades at a -5% discount to our blended auto retail and NZ retail peer set, which trade on ~13x 12-month forward EPS.</li>
<li>We reiterate our OUTPERFORM rating, with an increased target price of NZ$7.05.</li>
</ul>


Turners Automotive (TRA) has delivered top-quartile earnings growth and consistency in the NZ market over the past nine years.
TRA trades at a -5% discount to our blended auto retail and NZ retail peer set, which trade on ~13x 12-month forward EPS.
We reiterate our OUTPERFORM rating, with an increased target price of NZ$7.05.


Turners Automotive Group Ltd - Still Gas in the Tank