Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Wrightson returns to profit after year-earlier impairment

Wrightson returns to profit after year-earlier impairment; outlook clouded by dairy slump

By Jonathan Underhill

Aug. 12 (BusinessDesk) - PGG Wrightson, the rural services firm controlled by China’s Agria Corp, posted an annual profit after a year-earlier loss driven by a historical impairment, and held off making a forecast for 2015 because of volatile dairy prices.

Profit was $42.3 million in the 12 months ended June 30, from a loss of $306.5 million a year earlier, when it took a $321 million charge to write off goodwill from its 2005 merger. Sales rose to $1.2 billion from $1.13 billion.

The Christchurch-based company updated its guidance for what it called operating Ebitda in June, to a range of $56 million and $58 million. Based on that non-GAAP measure it reported earnings for the year of $58.7 million, beating guidance and exceeding a Forsyth Barr forecast of $57 million.

Despite uncertainty over dairy prices, Wrightson is upbeat about the outlook, having acquired irrigation businesses and bought back properties it was leasing, including retail stores, seed processing sites and livestock saleyards in the latest year.

“The outlook for our core sheep, beef, arable, horticulture and viticulture markets is positive and will continue to be a major focus for the company, and in addition we are going to put more emphasis on the dairy, water and agronomy sectors in New Zealand,” said chief executive Mark Dewdney.

He said the company is confident it will increase operating Ebitda in the current year but “given the volatility in the forecast dairy price at the current time, and the need to assess the likely impact for PGW’s clients and the sector,” the company would wait until its annual meeting in October to give guidance.

Prices of dairy products tumbled to the lowest since October 2012 in the latest GlobalDairyTrade auction, which came after Fonterra Cooperative Group slashed its forecast farmgate milk payout for 2015 to $6 per kilogram of milk solids from $7/kgMS.

Wrightson’s rural services division delivered the biggest contribution to earnings in the latest year, with net profit of $37.5 million, from an impairment-marred loss of $78 million a year earlier. Sales rose 11 percent to $766 million.

Seed & Grain, which took the biggest share of the previous year’s impairment, posted profit of $23.9 million from a loss of $206 million. Sales climbed 9 percent to about $530 million.

Retail lifted profit to $17 million from $15.9 million as sales rose 12 percent to $486 million, while livestock posted profit of $10.4 million from a loss of $73.8 million as sales fell 22 percent to $76.9 million. Profit from Other Rural Services was $10 million, from a year-earlier loss of $20.5 million as sales climbed about 30 percent to $202.8 million.

The company will pay a fully imputed dividend of 3.5 cents a share on Oct. 3, with a record date of Aug. 26. The payment is made up of a final dividend of 2.5 cents and a special dividend of 1 cent brings total dividends for the year to 5.5 cents.

The shares last traded at 39.5 cents and have declined 1.3 percent this year.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

R18: The Warehouse Group Praised For Removing Games

The decision by New Zealand’s largest retailer The Warehouse Group (TW Group), to withdraw stocks of the latest version of Grand Theft Auto V (GTA V) and other R18 games, has been praised by advocacy group Stop Demand Foundation. More>>

ALSO:

Air NZ Wine Awards: Victory For Villa Maria As Pinot Noir Thrills

It was a night to remember as Villa Maria Estate picked up one of the highest accolades of the evening, the O-I New Zealand Reserve Wine of the Show Trophy, at the 28th Air New Zealand Wine Awards. The Villa Maria Single Vineyard Southern Clays Marlborough ... More>>

ALSO:

Future Brighter Money: RBNZ Releases New Bank Note Designs

New Zealand’s banknotes are getting brighter and better, with the Reserve Bank today unveiling more vibrant and secure banknote designs which will progressively enter circulation later next year. More>>

ALSO:

Commerce: Supermarket Inquiry Finds No Breaches By Countdown

The Commerce Commission inquiry into anti-competitive behaviour by Countdown supermarkets, alleged by former Labour Party MP Shane Jones, has found nothing to warrant prosecution, although it warns supermarkets to take care in the way they communicate... More>>

ALSO:

Crown Accounts: English Flags ‘Challenge’ To Budget Surplus

Finance Minister Bill English is warning next month’s half yearly fiscal and economic update from the Treasury may not forecast a budget surplus, saying that returning the government’s accounts to surplus in 2015 will be “a challenge”, given the decline in commodity prices and weak global inflation. More>>

ALSO:

March 2015: Netflix To Launch In Australia And New Zealand

World’s Leading Internet Television Network to Offer Original Series, Movies, Documentaries, Stand-Up Comedy Specials and TV Shows for Low Monthly Price More>>

ALSO:

Price Of Cheese (Is Up): Dairy Product Prices Fall To Five-Year Low

Dairy product prices fell in the latest GlobalDairyTrade auction to the lowest level in more than five years, led by declines in rennet casein and skim milk powder. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news