South Island Index - 4th EditionReview of performance for the December 2008 quarter |
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South Island listed companies were not immune from the bumpy downhill slide experienced by most financial markets, according to the fourth 2008 Deloitte South Island Index. The Index fell by 18.4% in the fourth quarter of 2008, with a record $694 million value wiped off the total market capitalisation of $3.08 billion. In contrast, the NZX 50 index was down 12.1% in the quarter.
The $694 million negative movement in the quarter was primarily due to the performance of primary sector companies Pike River Coal, New Zealand Farming Systems Uruguay and PGG Wrightson. Collectively, these three companies lost a combined $426.7 million of market capitalisation this quarter, amounting to 61% of the overall downward movement in the Index during the quarter.
The third quarter decline eroded all the value that South Island companies had created over the past two years and effectively put the market back at square one. This most recent decline continues to eat away at value and puts the South Island firmly in negative territory. The theme for 2009 will be “managing in volatile times”, and shrewd companies should be seizing opportunities and making the most of them.
The Deloitte South Island Index measures movements in market capitalisation, tracking the performance of more than 30 listed companies with a registered office and/or a substantial portion of their operations in the South Island.
See Paul Munro speaking about the South Island Index on TV3's ASB Business
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