PGW - PGG Wrightson [Archive] - Page 14

noodles

04-02-2015, 06:52 PM

Spec div - see above.

Operating EBITDA - that is the approach I tried to use.

Took the company's figure for operating EBITDA, which excludes excluding associates' earnings, non-operating items and fair value adjustments.

Then took off interest and tax.

As it happens - it give a figure ('EBDA-ASS' above) which coincidentally is the same as the reported NPAT.

Does that method look right to you - any income in there that shouldn't be?

You have picked one of the more complex annual reports to decipher. This is my calc for underlying earnings

Operating EBITDA
58747

Equity accounted earnings of associates
2521

DA
-11242

Abnornal depreciation of IT system
3500

EBIT
53526

Interest
-7926

NPBT
45600

TAX @28%
12768

NPAT
32832

eps
0.043

Further, I expect PGW is provide dividends that are approx 100% of earnings.

Remember earnings do not equal cashflow. Operating Cashflow - capex allows the payment of dividends. Sometime increasing debt can be used as well.

bunter

04-02-2015, 07:50 PM

You have picked one of the more complex annual reports to decipher.

It does look complicated. Maybe your figures are a 'normalised NPAT'.

Remember earnings do not equal cashflow. Operating Cashflow - capex allows the payment of dividends. Sometime increasing debt can be used as well.

Hadn't forgotten. Operating cashflow was what I tried to work out - being operating ebitda less interest and tax. Just wanted to be sure this figure was not less than the reported NPAT. Didn't look at CAPEX.

In fact it is almost the same - $42.3m.

If 2015 is 10% better than 2014, PGW will have about 46.5m available for divs.

Snoopy

04-02-2015, 10:37 PM

I excluded the 1c special dividend from the 2014 dividend figures.
From NZX...

22/08/2014
Final

3.500c
0.618c
1.361c
03/10/2014
NZD

10/03/2014
Interim
2.000c
0.353c
0.778c
02/04/2014
NZD

I used 2.5c + IC for the final div.

Excluding the special div it paid 80% of NPAT out (don't know about 'normalised').
I think it is reasonable to use 80% payout for 2015.

BTW by my calcs, including the special dividend, PGW didn't pay more than it earned in 2014 - it paid 98% of total earnings.

Fair enough Bunter. Like noodles, I am a shareholder, so I will be much better off if your calculations and estimates are correct.

Unlike noodles I would also take off $1.388m in revenue from 'changes in fair value', mainly livestock valuations of animals in stock. That should reduce 'normalised NPAT' further by:

(1-0.28) x -$1.388m = -$1.000m

Not sure what noodles means when he adds back $3.5m for 'abnormal depreciation of an IT system'. I thought that software was amortised as an intangible under goodwill, not depreciated. Hopefully noodles will explain where that $3.5m he added back comes from because I can't find it in either note 25 or 26.

I think I would also add back the foreign exchange loss of $1,664m (not subject to income tax?) declared in note 12

SNOOPY

noodles

04-02-2015, 10:41 PM

Fair enough Bunter. Like noodles, I am a shareholder, so I will be much better off if your calculations and estimates are correct. Unlike noodles I would also take off $1.388m in revenue from 'changes in fair value', mainly livestock valuations of animals in stock. That should reduce 'normalised profit' further by:

(1-0.28) x $1.388m = $1.000m
My normalised profit does not include:
-Fair value adjustments
-Non operating items

Snoopy

04-02-2015, 11:12 PM

My normalised profit does not include:
-Fair value adjustments
-Non operating items

Quite right. I should learn not to try to look up things late at night and get myself into trouble!

Your normalised profit does include $2.204m net profit after tax from 4 Seasons Feeds Limited though (note 9). That's been sold. So I don't think Bunter should use that $2.204m as part of his base earnings case for PGW for FY2015.

SNOOPY

bunter

04-02-2015, 11:34 PM

Your normalised profit does include $2.204m net profit after tax from 4 Seasons Feeds Limited though (note 9). That's been sold. So I don't think Bunter should use that $2.204m as part of his base earnings case for PGW for FY2015.

SNOOPY

I agree and in fact I didn't include any of the items in note 9 in my calcs.

Nor did PGW in its 'operating EBITDA' figure.
Equity accounted earnings aren't cash - the only cash is dividends from the companies.

I was happy to rely on PGW's 'operating EBITDAF figure - then take the cash items off - interest and tax.

Then believe them when they said 2015 is looking better.

Guess we'll find out soon.

This rain won't be hurting.

noodles

05-02-2015, 08:40 AM

Quite right. I should learn not to try to look up things late at night and get myself into trouble!

Your normalised profit does include $2.204m net profit after tax from 4 Seasons Feeds Limited though (note 9). That's been sold. So I don't think Bunter should use that $2.204m as part of his base earnings case for PGW for FY2015.

SNOOPY
Quite Right. I should read the fine print.
How about this for underlying earnings

Operating EBITDA
58,747

DA
-11,242

Abnornal depreciation of IT system
3,500

EBIT
51,005

Interest
-7,926

NPBT
43,079

TAX @28%
12,062

NPAT
31,017

Equity accounted earnings (excluding 4 Seasons Feeds Limited)
497

TOTAL NPAT
31,514

eps
0.041

Snoopy

05-02-2015, 09:05 AM

Guess we'll find out soon.

This rain won't be hurting.

My fear is that PGW will declare a record half year profit due to farmers selling off their capital livestock. That won't make for a pretty second half.

SNOOPY

Snoopy

05-02-2015, 09:36 AM

Abnormal depreciation of IT system
3,500

Noodles, I have been through the 2014 annual report. I saw a comment about replacing the point of sale IT systems. But I didn't find anything about an abnormal charge of $3.5m. Can you point me where that figure came from please?

TIA

SNOOPY

Snoopy

05-02-2015, 10:37 AM

PGW Market Cap:

Market Cap:
313.26M

PGW market capitalization is now $369.876m (share price 49c).

That is greater than the following current NZX50 listed shares, as of today:

ATM: $310.231m
STU: $255.662m
SKL: $266.072m
PEB: $245.334m
KMD: $286.108m
NZO: $273.714m

Time for a recall? Or will the 50% of tightly held shares held by Agria preclude a return to the NZX50?

SNOOPY

noodles

05-02-2015, 11:29 AM

Noodles, I have been through the 2014 annual report. I saw a comment about replacing the point of sale IT systems. But I didn't find anything about an abnormal charge of $3.5m. Can you point me where that figure came from please?

TIA

SNOOPY
Must have come from an investor conference call I think

bunter

05-02-2015, 12:35 PM

PGW market capitalization is now $369.876m (share price 49c).

That is greater than the following current NZX50 listed shares, as of today:

ATM: $310.231m
STU: $255.662m
SKL: $266.072m
PEB: $245.334m
KMD: $286.108m
NZO: $273.714m

Time for a recall? Or will the 50% of tightly held shares held by Agria preclude a return to the NZX50?

SNOOPY

Yes. IIRC any holding over 20% is removed from the free float. The NZX uses discretion for holdings between 5 and 20%.

I looked at this a month ago; the following's a table of companies that are might be nearly in or nearly out of the NZ50.

Bold = in NZ50 currently.
In=might get in 'Out' = might be removed

Looks like OHE and VGL might be added and NZX and SKL removed.
More wins for the tech sector at the expense of real companies.

PGW well down the track - $270 mil free float approx needed.
Check again when PGW is 75c

IN
OHE
?
900
approx

RBD

100%
364

IN
VGL
100%
307

STU

100%
293

PEB
100%
290

OUT
SKL
94%
268
cushing .06

ADDED
MPG

82%
268
Dir Cap .18

SML
50%
264
Brightside .4;campina .1

OUT
NZX

100%
256

REMOVED
NZO
80%
248
ZETA .2

ERD
100%
228

HBY
73%
222
Castle' 28%

IQE
75%
219
Former owners .25

DPC
100%
191
19.9% Hugh Green Inv

HLG
100%
190

PGW
50%
168
Agria .5

SCL
82%
166

WYN
66%
160

THL
100%
159

DGL
33%
159
Delegats .67

sb9

05-02-2015, 04:17 PM

After 50c the price increments are in 1c, not .005c(half cent), right??

Snow Leopard

05-02-2015, 04:28 PM

After 50c the price increments are in 1c, not .005c(half cent), right??

Correct for PGW

Only the following can trade in 0.5c increments above 50c:
AIA, AIR, ARG, AUG, CDI, CNU, DNZ, GFF, GMT, GPG, IFT, KIP, MELCA, MRP, NPT, NZO, PCT, PFI, SPK, SPY, VHP, TWR
[stolen from ASB Sec website]

Best Wishes
Paper Tiger

Te Whetu

05-02-2015, 07:55 PM

One cent increments is meant to increase liquidity, presumably at the expense of increasing the spread.

There have been studies... which I read the title of.

From personal experience, I think the reason liquidity is increased is that by reducing the number of price points at which you can trade shares, you artificially simplify the buy/no buy decision. I.e. it becomes less about placing an order 0.5 cents in front of the other seller/buyer, and more about whether you are going to make the transaction. But that's just my theory.

sb9

19-02-2015, 10:57 AM

Should break 50c mark today looking at the depth.

Beagle

19-02-2015, 01:03 PM

Correct for PGW

Only the following can trade in 0.5c increments above 50c:
AIA, AIR, ARG, AUG, CDI, CNU, DNZ, GFF, GMT, GPG, IFT, KIP, MELCA, MRP, NPT, NZO, PCT, PFI, SPK, SPY, VHP, TWR
[stolen from ASB Sec website]

Best Wishes
Paper Tiger

Does anyone know what's behind this...why some stocks can trade in half cent increments and others not ?

sb9

19-02-2015, 01:29 PM

Dairy payout forecast up can only help too

True along with anticipated results due out on Tuesday. Big volumes through today.

Snoopy

19-02-2015, 04:27 PM

I looked at this a month ago (whether PGW mighte be due for a return to the NZX50);

PGW well down the track - $270 mil free float approx needed.
Check again when PGW is 75c

With the Agria holding 'locked up' for index weighting purposes, and PGW flirting with 50c at what must be near the top of the natural cycle I make the following call: PGW will never again be part of the NZX50.

For me that means I must reduce my holding, because I have made a rule that I won't hold over a certain dollar amount of value for any share I hold outside of the NZX50. I was hanging out for PGW to return to the NZX50. But I can't forecast a realistic scenario where that will become possible.

Dairy payout forecast up can only help too

The problem is the dairy payout forecast isn't up. The dairy products auction "auction prices" are up, yes. But those prices are still below what is required for Fonterra to make their best estimate payout. The other problem is that dairy prices are up because of drought in NZ. Many dairy farmers are drying off their cows because of a lack of feed.

(Decent Milk Price) x (Zero Milk for sale) = (Zero Income)

I took a tiny slither of capital off the market today. Reduced by average PGW holding price from 44.5c to 43.5c. Woo Hoo! OK my buying over the years has not left me with the profit that some of you latecomers have.

I am predicting a really good first half result, and a decent interim dividend mainly as a result of the livestock division. farmers desperately quitting their stock means good turnover at the stockyards even if it is PGW that will be making the profit - not farmers. The problem I think will be the outlook. Mark 'the dewd' Dewdney may just make his forecast of beating last years result on an annual basis. But I can't see FY2016 being as buoyant.

SNOOPY

discl: Sold down, but no plans to quit my holding.

sb9

20-02-2015, 03:39 PM

Might close today at 51c

see weed

20-02-2015, 04:54 PM

Might close today at 51c

I'm happy at 50c. Lets hope that flock of cows come home to roost next week or will be up sh.t creek without a piddle. up to my waist in PGW and ATM:D.

nzspeak

23-02-2015, 08:44 PM

PGW report tomorrow, last time they reported many weren't happy with how the accounts were presented (I'm not an accountant so pardon the lingo) I even saw a Herald article about this saying the muted response in the SP was due to accounting irregularities (nothing fraudulent). The CFO left afterwards in September (I never saw this mentioned here which suprised me). The share price has increased to .51c today (inside trading I hope) and I'm wondering are we in for a nice surprise tomorrow? Good result, good accounting, great divi!

see weed

23-02-2015, 09:17 PM

percy

24-02-2015, 08:52 AM

A cracker result.
The business is now really starting to make the most of the opportunities that are coming their way.
Investment in staff,technology,premises and systems starting to show through.
The 2 cent fully imputated divie is the icing on the increasing sp cake.!!!
Well done PGW.

Beagle

24-02-2015, 09:23 AM

see weed

24-02-2015, 09:36 AM

Good aye. Notice buyers building up. What you think 52 to 53c today?

sb9

24-02-2015, 10:06 AM

Good aye. Notice buyers building up. What you think 52 to 53c today?

Its 53c already, I wouldn't be surprised if it broke thro the 55c mark today..

Beagle

24-02-2015, 10:15 AM

Its 53c already, I wouldn't be surprised if it broke thro the 55c mark today..

Cracker result and deserves to be in the mid 50's. Couldn't help myself and bough more at the open at 52 cents...(really only paying 50 cents because you get 2 cents back very shortly).

Snoopy

24-02-2015, 10:16 AM

Agreed. Superb result considering the challenging climatic conditions.

For PGW I always go to the 'segmented' results to see how things are progressing. Of note is the livestock turnover, up to $41.454m compared to $29.494m for the comparable prior period. Operating EBITDA has not unexpectedly grown from $1.026m to $3.358m over the same period. The 'Dewd' commented:

"Livestock improved Operating EBITDA by $2.3m. Livestock tallies were broadly in line with the prior corresponding period but prices were higher in cattle and sheep, resulting in higher commission income and earnings."

So no higher throughput of animals which was a bit of a surprise. Could farmers just be sending excess stock straight to the works? Could that jepordise PGWs Livestock earnings in the second half, should the drought continue?

SNOOPY

see weed

24-02-2015, 10:17 AM

Its 53c already, I wouldn't be surprised if it broke thro the 55c mark today..

4 big sellers at 55c block. When they go , could go to 58c to 60c by end of year:D.

Beagle

24-02-2015, 10:27 AM

For PGW I always go to the 'segmented' results to see how things are progressing. Of note is the livestock turnover, up to $41.454m compared to $29.494m for the comparable prior period. Operating EBITDA has not unexpectedly grown from $1.026m to $3.358m over the same period. The 'Dewd' commented:

"Livestock improved Operating EBITDA by $2.3m. Livestock tallies were broadly in line with the prior corresponding period but prices were higher in cattle and sheep, resulting in higher commission income and earnings."

So no higher throughput of animals which was a bit of a surprise. Could farmers just be sending excess stock straight to the works? Could that jepordise PGWs Livestock earnings in the second half, should the drought continue?

SNOOPY

Good on you for reading through the segmented results.

Feed is in short supply around the country and we are having arguably one of the most challenging summers in living memory in parts of the country. I have no doubt meaningful numbers of farmers are sending their stock straight to the works but take a lot of comfort from the upgraded full year forecast and I tend to look through the current challenging climatic conditions to see what effect going forward.
I think irrigation supply sales will be massive in the next few years.

sb9

24-02-2015, 05:25 PM

Some big players have decided to spoil the party for everyone.....

see weed

24-02-2015, 05:37 PM

Some big players have decided to spoil the party for everyone.....

They are ok. Probably taking early div. and when price gets low enough will buy back in again for another div. on 8/4/15.

percy

24-02-2015, 05:40 PM

Some big players have decided to spoil the party for everyone.....

At 50cents I am still in party mode.!!! lol.

tim23

24-02-2015, 07:53 PM

Gee add another 1 or 2c dividend next 6 months and you have minimum 6 or 8% net yield, expect to be re-rated to 60c in short order.

see weed

24-02-2015, 11:14 PM

Gee add another 1 or 2c dividend next 6 months and you have minimum 6 or 8% net yield, expect to be re-rated to 60c in short order.

I predict 5c for full year which is 10% yield. Correct me if I'm wrong.

percy

25-02-2015, 07:37 AM

I predict 5c for full year which is 10% yield. Correct me if I'm wrong.

I am very happy with your prediction..!!!!! lol.

Master98

25-02-2015, 08:04 AM

I predict 5c for full year which is 10% yield. Correct me if I'm wrong.

wow! can not find another stock on nzx that has such high divv return!

Beagle

25-02-2015, 08:34 AM

I predict 5c for full year which is 10% yield. Correct me if I'm wrong.
Very happy to do that. An investor buying now cum 2 cent dividend could effectively make the argument they're only paying 48 cents in that they haven't been on board for the full six months and earned the dividend, (so to speak).
Looking forward given their outlook its easy to make the case that we're looking at a sustainable dividend yield of 5 cents fully imputed so 5 / 0.72 = 6.9444 cents gross which on a 48 cent net investment means someone taking a medium / long term view could make the case that they're investing on a 6.9444 / 48 = 14.47% gross dividend yield :)

I am very happy with your prediction..!!!!! lol.
Me too.

wow! can not find another stock on nzx that has such high divv return!
Quite right there isn't one. Perfect stock for dividend hounds :)

and a positive forecast.......
In adverse climatic conditions and a difficult dairy situation.
One wonders how well they'll do given more favourable climatic conditions :)

sb9

25-02-2015, 01:23 PM

Looks like some big players have bit of stranglehold on sp in the short term.

GR8DAY

25-02-2015, 03:40 PM

Looks like some big players have bit of stranglehold on sp in the short term.

....DON'T THINK THAT WILL LAST FOR LONG SB........there are also 3 times the number of buyers as sellers on the top line........whats that saying? (traders out...longtermers in? ). Still the best yield stock with growth prospects on the market I believe. A run of good weather and solid spending from the cockies shud see SP up around, if not over the 60c mark IMHO.

Beagle

25-02-2015, 04:33 PM

....DON'T THINK THAT WILL LAST FOR LONG SB........there are also 3 times the number of buyers as sellers on the top line........whats that saying? (traders out...longtermers in? ). Still the best yield stock with growth prospects on the market I believe. A run of good weather and solid spending from the cockies shud see SP up around, if not over the 60c mark IMHO.

+1 I agree.

noodles

25-02-2015, 10:04 PM

A bit of colour on how the full year forecasts have been derived
http://podcast.radionz.co.nz/business/bus-mnr-20150225-0653-pgg_wrightson_picks_higher_full-year_earnings_despite_risks-048.mp3

noodles

25-02-2015, 10:45 PM

After 3 broker reports, the average target price has now moved up to 56c (from 50c)
http://www.4-traders.com/zbcache/reuters/Draw_Chart.php?p=6,1,605,475,PGG+Wrightson+Limited&RepNo=A9C32&L2

If we get another 4.5 dividend and the price reaches target, we could see a return of (.56-.50) +.045= .105. That is greater than a 20% return.

DarkHorse

25-02-2015, 10:59 PM

Great info thanks. Just started to seriously consider investing, and reading back through posts here is very helpful. Looking at it as a business what strikes me is its low margins - which of course may of present both a risk and an opportunity, depending on the competitive environment and the degree and direction of any competitive advantages (economies of scale? specialist know-how?) they have within it. Margins have obviously been improving. Do y'all think this is sustainable given the markets for their main products and services?
If it's a "cyclical" - and therefore we should focus on PS rather than PE - it still looks potentially cheap...

stones

26-02-2015, 06:54 AM

You lot have convinced me about this company and have joined the clan

percy

26-02-2015, 07:58 AM

RGR367

26-02-2015, 09:29 AM

You lot have convinced me about this company and have joined the clan

Though no one should be late for a Party, there's still plenty of food coming to this table, I reckon :) Welcome to the Clan then Stones!

stones

26-02-2015, 10:19 AM

What time is the party!!!!!!!!!?

Master98

01-03-2015, 06:07 PM

Regrassing boosts demand for seeds.

http://www.stuff.co.nz/business/farming/agribusiness/66736577/regrassing-boosts-demand-for-seeds

GR8DAY

02-03-2015, 10:25 AM

Regrassing boosts demand for seeds.

http://www.stuff.co.nz/business/farming/agribusiness/66736577/regrassing-boosts-demand-for-seeds

.....EVERY CLOUD HAS A SILVER LINING FOR PGW? CAN SOMEONE CONFIRM THE EX-DATE FOR THE UPCOMING 2c DIVI ?

Toasty

02-03-2015, 10:31 AM

.....EVERY CLOUD HAS A SILVER LINING FOR PGW? CAN SOMEONE CONFIRM THE EX-DATE FOR THE UPCOMING 2c DIVI ?

8th March. Can't wait.

Toasty

02-03-2015, 10:32 AM

8th March. Can't wait.

Oops sorry. That's the payment date.

Toasty

02-03-2015, 10:32 AM

Oops sorry. That's the payment date.

Crap. And that should be 8th April. I'm gonna quit now.

Toasty

02-03-2015, 10:34 AM

.....EVERY CLOUD HAS A SILVER LINING FOR PGW? CAN SOMEONE CONFIRM THE EX-DATE FOR THE UPCOMING 2c DIVI ?

One last try. 12 March is record date.

GR8DAY

02-03-2015, 10:36 AM

......cheers Toasty, you got there in the end! Plenty of time then to continue with the accumulation!

Beagle

02-03-2015, 12:35 PM

......cheers Toasty, you got there in the end! Plenty of time then to continue with the accumulation!

And plenty there at 52 cents. 50 cents on a ex divvy or 52 cum divvy basis looks like a pretty reasonably priced, (in a sea of fully priced stocks) opportunity to me :)

see weed

02-03-2015, 01:13 PM

And plenty there at 52 cents. 50 cents on a ex divvy or 52 cum divvy basis looks like a pretty reasonably priced, (in a sea of fully priced stocks) opportunity to me :)

Sometimes stocks go up after ex div. specially if they put out a good positive announcement the day before ex div. I might be in for some more too. Looks better than 4% in the bank:t_up:.

GR8DAY

02-03-2015, 01:31 PM

......and that 4% divi is just for the 6mnths, so indeed why would you have money in the bank.?? (so I keep reminding myself) PLUS of course every cent they put on is another 2% or so to add to that return. PGW could be a 20%er for the coming year if all goes to plan.

sb9

03-03-2015, 12:12 PM

Yes. Who are these crazy people :)

More crazy people joined there, more than 900k on offer at 52c...

RGR367

03-03-2015, 01:39 PM

More crazy people joined there, more than 900k on offer at 52c...
Might join those crazy ones again as I bought my last bundle more than a year ago now :t_up:

Master98

03-03-2015, 02:05 PM

More crazy people joined there, more than 900k on offer at 52c...
could these sellers disappear suddenly, who knows.

sb9

03-03-2015, 02:30 PM

Might join those crazy ones again as I bought my last bundle more than a year ago now :t_up:

Gosh, half of sell side is now at 52c....more than Mln shares....

YoungBuck

04-03-2015, 05:07 PM

Toasty

04-03-2015, 05:19 PM

I put a buy in at 51 cents yesterday and a few have been sold at that price since, I was wondering what determines who gets the buy/sell when there are multiples buyers/sellers? is it the first to bid at that price?

I may be wrong but I assume that it is in order that the bids are submitted. The earlier you put your order in the further up the food chain you are. Happy to be corrected.

see weed

05-03-2015, 12:40 AM

I put a buy in at 51 cents yesterday and a few have been sold at that price since, I was wondering what determines who gets the buy/sell when there are multiples buyers/sellers? is it the first to bid at that price?

Same here. I'm about 258,000 down the food chain, so as soon as they go through, will be at top of que. The rest of yours will go through tomorrow hopefully.

couta1

05-03-2015, 06:03 AM

I may be wrong but I assume that it is in order that the bids are submitted. The earlier you put your order in the further up the food chain you are. Happy to be corrected.
This is correct but if you make any changes to your order before it becomes part traded you go back to the end of the que, sometimes your order can jump ahead of the que if the broking house you are with has another client who wants to buy or sell off market and they match their order fully or partially with yours.

Master98

05-03-2015, 08:21 AM

This is correct but if you make any changes to your order before it becomes part traded you go back to the end of the que.

not quite right, if you only change qty then you still stay in the same position.

couta1

05-03-2015, 09:05 AM

not quite right, if you only change qty then you still stay in the same position.
Sorry to disagree but that's not correct, any quantity change will put you at the back of the que.

Master98

05-03-2015, 10:53 AM

Sorry to disagree but that's not correct, any quantity change will put you at the back of the que.

ok, learn new things every day. cheers

Snow Leopard

05-03-2015, 04:31 PM

Had some spare cents come in and have spent them on a few PGW.

Intended to buy in when they were kicking around $0.455 and then intended to buy in mid Feb and they were $0.49 or less (long story around that one).

Anyway let us hope that I have not arrived too late and there is yet some profit in it.

Best Wishes
Paper Tiger

see weed

06-03-2015, 10:41 AM

Sorry to disagree but that's not correct, any quantity change will put you at the back of the que.

Just phoned ASB sec. They said I can change the quantity from 17,000 to 20,000 buy order and not loose my position in the que. But if I change the price, then I go to the back of the que.

Master98

06-03-2015, 10:53 AM

Just phoned ASB sec. They said I can change the quantity from 17,000 to 20,000 buy order and not loose my position in the que. But if I change the price, then I go to the back of the que.

I operate this way for years until couta1 correct me.:t_down:

couta1

06-03-2015, 06:07 PM

Just phoned ASB sec. They said I can change the quantity from 17,000 to 20,000 buy order and not loose my position in the que. But if I change the price, then I go to the back of the que.
Not so according to ANZ securities so you and Master98 can believe ASB sec if you like but I don't and have you actually tested out and watched a changed order to see if ASB aren't telling you porkies? ( I have and you lose your position if you change price or quantity) It wouldnt be fair if someone else now have to sit behind your increased order when their order was placed ahead of your extras:cool:

see weed

06-03-2015, 11:21 PM

Not so according to ANZ securities so you and Master98 can believe ASB sec if you like but I don't and have you actually tested out and watched a changed order to see if ASB aren't telling you porkies? ( I have and you lose your position if you change price or quantity) It wouldnt be fair if someone else now have to sit behind your increased order when their order was placed ahead of your extras:cool:

I think you might be right couta1. The young fella at ASB sec. might have it wrong. I worked it out that I only had about 60,000 ahead of me. At the end of the day after changing the quantity, phoned ASB, and they told me I was 160,000 down the que:scared:. My next question is....10 minutes before closing 330,000 on buy side 51c and 1,128,000 on sell side at 52c. A minute later 100,000 appears to sell at 51c. My question is if I change my buy order of 20,000 shares from 51c to 52c in that last 10 minutes to get me to the top of the que, do I still get them at 51c? Did notice someone else put an order in to buy 20,000 at 52c eight minutes before closing, which put them at the top of the que, but the 1,128,000 sellers had not changed after 5pm. and wonder if they got theirs at 51c :confused:? Learning more by the day.

stoploss

06-03-2015, 11:59 PM

I think you might be right couta1. The young fella at ASB sec. might have it wrong. I worked it out that I only had about 60,000 ahead of me. At the end of the day after changing the quantity, phoned ASB, and they told me I was 160,000 down the que:scared:. My next question is....10 minutes before closing 330,000 on buy side 51c and 1,128,000 on sell side at 52c. A minute later 100,000 appears to sell at 51c. My question is if I change my buy order of 20,000 shares from 51c to 52c in that last 10 minutes to get me to the top of the que, do I still get them at 51c? Did notice someone else put an order in to buy 20,000 at 52c eight minutes before closing, which put them at the top of the que, but the 1,128,000 sellers had not changed after 5pm. and wonder if they got theirs at 51c :confused:? Learning more by the day.

The shares will "level out" where the most volume can be transacted , so if there were say buyers of 40,000 @ 52 , and a seller of 100,000 @ 51 , in this instance your buy @ 52 would be improved to 51 . If however the offer moved back at the last second to 52, or reduced to say 39,999, you would get filled at 52 .

couta1

07-03-2015, 01:53 AM

I operate this way for years until couta1 correct me.:t_down:
Couta correct you for your own benefit:t_up:

tim23

07-03-2015, 04:56 PM

I understand there is matching within a brokerage where you can be effectively queue jumped.

Grimy

07-03-2015, 09:17 PM

Come on guys. Enough already. Back to PGW!

see weed

07-03-2015, 10:33 PM

The shares will "level out" where the most volume can be transacted , so if there were say buyers of 40,000 @ 52 , and a seller of 100,000 @ 51 , in this instance your buy @ 52 would be improved to 51 . If however the offer moved back at the last second to 52, or reduced to say 39,999, you would get filled at 52 .

Thanks stoploss, will try it on monday if they do not go through. I think tuesday is ex div. day according to ASB.

GR8DAY

09-03-2015, 08:08 AM

Thanks stoploss, will try it on monday if they do not go through. I think tuesday is ex div. day according to ASB.

......record day for divi is 12th (thurs) which makes Friday 13th trades X-divi.....pretty sure I've got that right

noodles

09-03-2015, 08:09 AM

......record day for divi is 12th (thurs) which makes Friday 13th trades X-divi.....pretty sure I've got that right
I'm pretty sure you have that wrong. Ex-div is tomorrow. Therefore, those wanting the dividend need to buy today

couta1

09-03-2015, 08:23 AM

I'm pretty sure you have that wrong. Ex-div is tomorrow. Therefore, those wanting the dividend need to buy today
Your correct noodles buy today or miss out record day comes after Ex day. To clarify record day is the day your name must be on the register to receive the dividend but in order to be on the register you must buy before Ex day which is tomorrow:cool:

Beagle

09-03-2015, 09:40 AM

Your correct noodles buy today or miss out record day comes after Ex day. To clarify record day is the day your name must be on the register to receive the dividend but in order to be on the register you must buy before Ex day which is tomorrow:cool:

The dividend hounds will be in full cry today :)

noodles

09-03-2015, 09:54 AM

The dividend hounds will be in full cry today :)

A 4.5c dividend represents 12.5% Gross Yield. Buy today and hold till the next dividend in six months and your gross yield is 25%

For a hound, that is quite intoxicating!

DISC: Not a hound

BlackPeter

09-03-2015, 10:08 AM

A 4.5c dividend represents 12.5% Gross Yield. Buy today and hold till the next dividend in six months and your gross yield is 25%

For a hound, that is quite intoxicating!

True. However looks like that all these hounds are already too intoxicated and forgot the hunt for the booze. Current depth shows 850k bids (@ avg 49.2 cents) and nearly 2.5 Million asks (at avg 52.8 cents). Does not look like a pre-ex-divvie spike to me. Funny share - just wondering what the price will do after today - 45 cents anybody in response to the hangover?

couta1

09-03-2015, 10:10 AM

GR8DAY

09-03-2015, 10:10 AM

A 4.5c dividend represents 12.5% Gross Yield. Buy today and hold till the next dividend in six months and your gross yield is 25%

For a hound, that is quite intoxicating!

DISC: Not a hound

....dunno how you figure that one Noodles. This next divi is 2c......thats around 4%.......the next one in 6mnths is , well let me think.....no-one knows..... please give some detail to your 25% claim???

noodles

09-03-2015, 10:14 AM

couta1

09-03-2015, 10:23 AM

Master98

09-03-2015, 11:03 AM

if this share act same behavior as previous years then share price will tumble after ex divvy.

couta1

09-03-2015, 11:09 AM

if this share act same behavior as previous years then share price will tumble after ex divvy.
Never can tell with an irrational market meanwhile the Mexican standoff continues between the 51and 52 cent crowd. Interesting watching the games being played here someone pulled their order of 200k shares on at 51c and sold them at 52c off market, I wonder if the market doesn't want it to close off below 52c today meaning 50 c open tomorrow and keep price above 50c, just thinking aloud here.

Beagle

09-03-2015, 12:33 PM

True. However looks like that all these hounds are already too intoxicated and forgot the hunt for the booze. Current depth shows 850k bids (@ avg 49.2 cents) and nearly 2.5 Million asks (at avg 52.8 cents). Does not look like a pre-ex-divvie spike to me. Funny share - just wondering what the price will do after today - 45 cents anybody in response to the hangover?
Not sure I follow your logic mate. As an experienced investor you'd already be very familiar with the theory and practice behind dividend stripping. If not, recall how many investors actively targeted PGW and AIR last year when both stocks had special dividends combined with their final divvy's. In both cases those companies took longer than the usual few weeks to recover the dividend, (something seasoned dividend strippers would have been aware was likely given the size of those divvies) but in both cases investors buying either just before they went ex or immediately afterwards did very well didn't they !!

This divvy hound just grabbed another 74k shares at match price of 51c didnt want to get into a dog fight all day waiting in a big que:cool:
In like a hungry Beagle..good buying mate :)

Consensus broker EPS is 5.0 cps and the major shareholders wants / needs as much divvy as they can get so I see no reason why we won't get another special this year so working on paying it all out and including full imputation credits we're looking at 6.94 cps gross. I'd say the divvy hounds will be howling with delight again this year.

BlackPeter

09-03-2015, 01:05 PM

Not sure I follow your logic mate. As an experienced investor you'd already be very familiar with the theory and practice behind dividend stripping. If not, recall how many investors actively targeted PGW and AIR last year when both stocks had special dividends combined with their final divvy's. In both cases those companies took longer than the usual few weeks to recover the dividend, (something seasoned dividend strippers would have been aware was likely given the size of those divvies) but in both cases investors buying either just before they went ex or immediately afterwards did very well didn't they !!

In like a hungry Beagle..good buying mate :)

Consensus broker EPS is 5.0 cps and the major shareholders wants / needs as much divvy as they can get so I see no reason why we won't get another special this year so working on paying it all out and including full imputation credits we're looking at 6.94 cps gross. I'd say the divvy hounds will be howling with delight again this year.

Hi Roger, all good ... though I am not quite sure what we currently observe is wide spread dividend stripping (as defined here: http://en.wikipedia.org/wiki/Dividend_stripping). If it is - shouldn't there be (pre ex div) more bidders who want to "strip" the dividend later (after ex div) than sellers who seem to be interested in foregoing their divvie (not sure, why?) :confused:?

Beagle

09-03-2015, 01:14 PM

Hi BP, I'm not sure I understand the depth of selling at 52/3 either ? Maybe people are concerned with the drought's effects on the agri sector but as far as I'm concerned the company only very recently upgraded its 2015 forecast and the drought was already in full effect so its effects are probably already pretty well understood by management, I would have thought. I think divvy strippers are more likely to target final divvies which are higher especially when they include special divvies.

Stock currently trades on a 2015 PE of 10 and a gross dividend yield of 5/0.7 = 6.94 / 50 (presuming it settles immediately ex divvy at 50 cents) of 13.9% which makes it a good yield investment IMHO.
FWIW if anyone's interested, I hold a modest position, circa 6% portfolio allocation...its the agricultural sector so I think it pays to be a bit conservative with allocation. I'm probably a bit too conservative here and would be keen to raise it to around 10%, (I have three hungry dogs to feed that aren't hounds so have to do the hounding for them LOL), on any meaningful correction.

see weed

09-03-2015, 01:27 PM

[QUOTE=Roger;563276]The dividend hounds will be in full cry today :)[/QUOTE) This divvy hound just grabbed another 74k shares at match price of 51c didnt want to get into a dog fight all day waiting in a big que:cool:

So that was you couta. I saw that 84,000 this morning and thought I would wait. Been waiting since 27/2/15 but bought 40,000 in a separate order last friday. Hopefully lots of 51ers will sell at 15 min close today

Master98

09-03-2015, 02:06 PM

Basically uncertainty of commodity prices and mother of nature means pgw is always uncertainty, generally second half contribute nearly 70% of whole year earnings, bad second half could eat those gain on first half,I would wait for pgw trading update early july, then know where to go.

see weed

09-03-2015, 02:11 PM

Bought 90,000 before last div. 6 and 7 months ago at average .455c = $3,150 div. - tax. Today the value of shares are up $4,950 plus div. $3,150 = $8,100. The sp drifted back a couple of cents after div. for a couple of weeks, then took off up to 48c to 50c. Might happen again this time and maybe get up to 56c to 58c in 6 months time, so am not too concerned if get the next lot of shares at 51or 52c.

see weed

09-03-2015, 02:30 PM

[QUOTE=couta1;563279]

So that was you couta. I saw that 84,000 this morning and thought I would wait. Been waiting since 27/2/15 but bought 40,000 in a separate order last friday. Hopefully lots of 51ers will sell at 15 min close today

Yaba daba do, mine have gone through at 51c.

Snoopy

09-03-2015, 03:49 PM

With the Agria holding 'locked up' for index weighting purposes, and PGW flirting with 50c at what must be near the top of the natural cycle I make the following call: PGW will never again be part of the NZX50.

For me that means I must reduce my holding, because I have made a rule that I won't hold over a certain dollar amount of value for any share I hold outside of the NZX50. I was hanging out for PGW to return to the NZX50. But I can't forecast a realistic scenario where that will become possible.

The problem is the dairy payout forecast isn't up. The dairy products auction "auction prices" are up, yes. But those prices are still below what is required for Fonterra to make their best estimate payout. The other problem is that dairy prices are up because of drought in NZ. Many dairy farmers are drying off their cows because of a lack of feed.

(Decent Milk Price) x (Zero Milk for sale) = (Zero Income)

I took a tiny slither of capital off the market today. Reduced by average PGW holding price from 44.5c to 43.5c. Woo Hoo! OK my buying over the years has not left me with the profit that some of you latecomers have.

I am predicting a really good first half result, and a decent interim dividend mainly as a result of the livestock division. farmers desperately quitting their stock means good turnover at the stockyards even if it is PGW that will be making the profit - not farmers. The problem I think will be the outlook. Mark 'the dewd' Dewdney may just make his forecast of beating last years result on an annual basis. But I can't see FY2016 being as buoyant.

discl: Sold down, but no plans to quit my holding.

First half result a little better than I expected. But took the opportunity to unload a few more shares late last week at 52c cum-dividend. I still have 3/4 of my highest previous high holding left. So not deserting the ship. Average holding price now 42cps. So even with the sales I am still behind a lot of you!

Just rebalancing because I think the earnings and dividend may shrink in FY2016 and FY2017. The farming cycle doesn't stay at the top forever. I think there are plenty of signs (milk price, drought) that things are going to get worse from here.

I know that every cloud has a silver lining. Some see the drought as fuel for a big increase in irrigation sales. I can tell you this won't happen, because there won't be enough farmers with cash in the bank to do it. No cash. no collateral => no loan.

Mark Dewdney doing a fantastic job, but I keep remembering the old Buffettism.

"When great management takes over an average business, it is usually the business that leaves with its reputation intact."

Have to side with Master98 on this one I'm afraid!

SNOOPY

discl PGW shareholder who has been through the cycles before

noodles

09-03-2015, 04:02 PM

Hi BP, I'm not sure I understand the depth of selling at 52/3 either ?
Market Depth is not necessary a indicator of sentiment of the stock. To me it shows the PATIENT buyers and sellers in the market rather than the impatient buyers and sellers. So for so many seller's to have bids at 52/53, it tells me they are not concerned about a sudden drop in the share price and are prepared to wait.

Beagle

09-03-2015, 04:05 PM

Having owned a beagle hound for 12 years they are eternally optimistic and have a veracious and opportunistic approach towards food consumption. Never trust a hound that isn't optimistic !!

This is a lesson I leaned at cost from the resident snoopy beagle hound who was extremely conservative about HNZ's prospects back when they were 95 cents...hmmm the canine missed out on a huge feed there...one ponders how his ability to sniff out a feed was so far off the mark...

I think management are doing a good job and if they can make their current forecast in the current extremely challenging climatic conditions this augers very well indeed for 2016 and beyond.

I note broker consensus is for 2015 and 2016 EPS of 5.0 cps.

noodles

09-03-2015, 04:05 PM

Maybe people are concerned with the drought's effects on the agri sector but as far as I'm concerned the company only very recently upgraded its 2015 forecast and the drought was already in full effect so its effects are probably already pretty well understood by management, I would have thought.
Exactly. Management gave guidance range only a couple of weeks ago. Their low end guidance still beat the FY14 EBITDA by quite a margin.

Snoopy

09-03-2015, 04:14 PM

Exactly. Management gave guidance range only a couple of weeks ago. Their low end guidance still beat the FY14 EBITDA by quite a margin.

Noodles, the upper end 'guidance' was based on a repeat of the second half of last financial year this financial year. The lower end guidance was based on a repeat of the second half guidance from the previous year when there were a few drought problems. But what if the drought this year is worse than that two years ago? (it is). What if commodity prices are worse than they were two years ago? (milk and wool are).

I am not sure you city hounds realise the potential seriousness of the rural situation. I think there is a real chance we will end up below lower end guidance for FY2015. But to a major extent FY2015 will soon be history. FY2015 is not the driving force for the share price going forwards from now. Next declared dividend will be in FY2016. I am almost certain things will be a lot tougher in FY2016. Remember, Mark Dewdney hasn't made any forecasts for FY2016.

SNOOPY

Snoopy

09-03-2015, 04:19 PM

I think management are doing a good job and if they can make their current forecast in the current extremely challenging climatic conditions this augers very well indeed for 2016 and beyond.

I note broker consensus is for 2015 and 2016 EPS of 5.0 cps.

Please get those brokers to forward the FY2016 long term weather forecast to farmers. It isn't really fair to keep that critical information within the broking community!

SNOOPY

noodles

09-03-2015, 04:21 PM

Noodles, the upper end 'guidance' was based on a repeat of the second half of last financial year this financial year. The lower end guidance was based on a repeat of the second half guidance from the previous year when there were a few drought problems. But what if the drought this year is worse than that two years ago? (it is). What if commodity prices are worse than they were two years ago? (milk and wool are).

I am not sure you city hounds realise the potential seriousness of the rural situation. I think there is a real chance we will end up below lower end guidance for FY2015. But to a major extent FY2015 will soon be history. FY2015 is not the driving force for the share price going forwards from now. Next declared dividend will be in FY2016. I am almost certain things will be a lot tougher in FY2016. Remember, Mark Dewdney hasn't made any forecats for FY2016.

SNOOPY
Yes, I'm a city hound. Yes, I understand that commodity prices for beef and lamb are weaker than they were earlier in the year. But as Mark suggested, the drought is becoming localised. So stock can be shifted around the country.

I would hope that the affects from the drought would not flow through to Fy16 earnings. However, I'm happy to be corrected here.

Snoopy

09-03-2015, 04:26 PM

Yes, I'm a city hound. Yes, I understand that commodity prices for beef and lamb are weaker than they were earlier in the year. But as Mark suggested, the drought is becoming localised. So stock can be shifted around the country.

I would hope that the affects from the drought would not flow through to Fy16 earnings. However, I'm happy to be corrected here.

Noodles, I am not saying that FY2016 earnings will definitely be down. I am saying there is a large probability that they will. That possibility is reason enough to rebalance my portflio. But remember I still hold 3/4 of my PGW shares!

SNOOPY

noodles

09-03-2015, 04:28 PM

Noodles, I am not saying that FY2016 earnings will definitely be down. I am saying there is a large probability that they will. That possibility is reason enough to rebalance my portflio. But remember I still hold 3/4 of my PGW shares!

SNOOPY

But why will FY16 be down? Because of the drought or commodity prices? Just trying to understand your concerns over Fy16

see weed

09-03-2015, 05:05 PM

Try to buy more before close but ASB is on a go slow.:(

Snow Leopard

09-03-2015, 05:27 PM

Noodles, I am not saying that FY2016 earnings will definitely be down. I am saying there is a large probability that they will. That possibility is reason enough to rebalance my portflio. But remember I still hold 3/4 of my PGW shares!

SNOOPY

Technically you hold all of your PGW shares on the grounds that the ones you sold are not yours any more. :)

But why will FY16 be down? Because of the drought or commodity prices? Just trying to understand your concerns over Fy16

I consider it exceedingly unlikely that FY16 will be identical so it will either be up or down.
So we could call it a 50/50 shot either way unless we have some belief that the company is in a position to improve it's 'financial efficiency' and skew that to, say, 60/40 in favour of up.

Watch the price move has the future unfolds.

Best Wishes
Paper Tiger

Beagle

09-03-2015, 05:27 PM

Please get those brokers to forward the FY2016 long term weather forecast to farmers. It isn't really fair to keep that critical information within the broking community!

SNOOPY

I think global warming is very very gradually affecting the weather and yet PGW seem to be adapting and doing fine notwithstanding this.

http://www.welovebeagles.com/how-to-beagle-proof-your-house/ How to beagle proof your house ? Hounds can be very likeable, often, but not always clever, and yet quite troublesome creatures, (not too dissimilar to the resident snoopy hound), as you can see from this link.

How to beagle proof your investment portfolio ? When a snoopy beagle thinks he can predict the weather and its affects on an agri supply company in 2016, tell him he's barking mad :D

noodles

10-03-2015, 09:50 PM

Noodles, the upper end 'guidance' was based on a repeat of the second half of last financial year this financial year. The lower end guidance was based on a repeat of the second half guidance from the previous year when there were a few drought problems. But what if the drought this year is worse than that two years ago? (it is).

SNOOPY

Snoopy,

I decided to do some research on the severity of the drought. My conclusion is that the drought of 2015 is far LESS severe than the drought of 2013. The image attached shows soil moisture deficit for 2013, 2014, and 2015. Clearly 2013 has the highest moisture deficit, but 2014 is worse than 2015. In 2013 MPI announced that the whole of the north island was in drought. This year it is some pockets in the south island. I appreciate that some farmers are doing it hard, but it seems to be a localised issue? With beef and lamb prices holding up from a year ago, what is all the fuss? Dairy is not that important to PGW.

7190

Sources:
http://www.mpi.govt.nz/document-vault/135
http://www.niwa.co.nz/static/climate/smd_map.png?1234

kiora

10-03-2015, 10:31 PM

Snoopy,

I decided to do some research on the severity of the drought. My conclusion is that the drought of 2015 is far LESS severe than the drought of 2013. The image attached shows soil moisture deficit for 2013, 2014, and 2015. Clearly 2013 has the highest moisture deficit, but 2014 is worse than 2015. In 2013 MPI announced that the whole of the north island was in drought. This year it is some pockets in the south island. I appreciate that some farmers are doing it hard, but it seems to be a localised issue? With beef and lamb prices holding up from a year ago, what is all the fuss? Dairy is not that important to PGW.

7190

Sources:
http://www.mpi.govt.nz/document-vault/135
http://www.niwa.co.nz/static/climate/smd_map.png?1234

But as well as dairy lamb prices aren't flash either
http://www.interest.co.nz/Charts/Rural/Lamb%20Y
From what I,ve heard hill country sheep farmers will be lucky to average $85 for all their lambs (works & store lambs).Bare in mind most need $100/lamb to break even but depending on their debt levels.
While very few S & B farmers have breeding cows to benefit from higher beef prices
Central NI,HB & SI have been severely affected by drought this year.What will the ewe CS at tupping be ?,what will the lambing % be next spring ? Most likely lower ?
Facial eczema appears to be more prevalent this year as well so there will be a higher cost for treatment or if not prevented a lower lambing % next spring.

noodles

10-03-2015, 10:53 PM

But as well as dairy lamb prices aren't flash either
http://www.interest.co.nz/Charts/Rural/Lamb%20Y
From what I,ve heard hill country sheep farmers will be lucky to average $85 for all their lambs (works & store lambs).Bare in mind most need $100/lamb to break even but depending on their debt levels.
While very few S & B farmers have breeding cows to benefit from higher beef prices
Central NI,HB & SI have been severely affected by drought this year.What will the ewe CS at tupping be ?,what will the lambing % be next spring ? Most likely lower ?
Facial eczema appears to be more prevalent this year as well so there will be a higher cost for treatment or if not prevented a lower lambing % next spring.
I'm not saying there aren't issues, but things aren't worse than 2013. Even the lamb price is higher in March 2015 than March 2013.
Snoopy was saying he thought that PGW earnings for 2h15 would be worse than 2H13.

Master98

10-03-2015, 11:25 PM

because of the nature of uncertainty and high risk pgw business , the highest PE I can use is 8, assuming FY2015 earnings 5~6cps then pgw share price should be 40c~48c,44c is meddle price.

couta1

11-03-2015, 03:13 AM

because of the nature of uncertainty and high risk pgw business , the highest PE I can use is 8, assuming FY2015 earnings 5~6cps then pgw share price should be 40c~48c,44c is meddle price.
Its all going to balance out with the increase in seed and irrigation sales to resow and water all those parched pastures so bring on 56c I say.

kiora

11-03-2015, 05:25 AM

I'm not saying there aren't issues, but things aren't worse than 2013. Even the lamb price is higher in March 2015 than March 2013.
Snoopy was saying he thought that PGW earnings for 2h15 would be worse than 2H13.

Regarding lamb price in March 2015 vs 2013 .This will have little affect on profitability of av hill country S & B farmer as they would have sold all there lambs by then while the lamb finishers will have had higher costs from growing lambs in a drought and high risk & cost of facial eczema.

kiora

11-03-2015, 05:27 AM

Its all going to balance out with the increase in seed and irrigation sales to resow and water all those parched pastures so bring on 56c I say.

But that doesn't help farmer profitability so will be cutting spending in other parts of their farming business.

Beagle

11-03-2015, 10:20 AM

because of the nature of uncertainty and high risk pgw business , the highest PE I can use is 8, assuming FY2015 earnings 5~6cps then pgw share price should be 40c~48c,44c is meddle price.

Each to their own valuation criteria....to be honest I would have said that myself a couple of years ago but the management team are doing a good job and we have ultra low interest rates for the foreseeable future which is supportive of some of the market PE expansion we've seen. In a market where many stocks have really stretched PE's I think 10 is more than fair and reasonable for PGW. Analyst consensus forecast is 56 cents so I wouldn't hold your breath hoping to buy them at 44 cents :)

Noodles - Thanks mate for the NIWA images, puts the present climatic conditions into the proper perspective.

couta1

11-03-2015, 10:38 AM

Is there anyone out there who has done enough study on this company to know things such as;

If there's a drought, do PGW do better overall through feed sales, irrigation units and more livestock movements etc or are they worse off due to reduced profits for farmers to spend and reduced livestock weights etc?

Over the long term it probably just averages out anyway, just the levels of debt etc for the farmer that change.
Exactly NB swings and round abouts a farmers debt levels are very fluid for this very reason, now if it was a nation wide drought that would be a different story.

Beagle

11-03-2015, 11:18 AM

Well if this drought is so tough then perhaps someone should sell so I can get a fill for my top-up buy order at 48.5 cents :)

couta1

11-03-2015, 11:28 AM

Just cause the grass looks green does not mean it's not a drought.
Currently 50% of the country is in what farmers refer to as a green drought another 25% is in a severe drought.
A green drought occurs when you have only had enough rainfall and heavy dews to keep a green tinge to the grass but not enough to make it grow.
When we are in a green drought the grass does not carry the nutrient or sugars required for production and is generally reffered to as maintenance grass(that is stock should maintain condition but not put on wieght
Looks like some good rain in the long term forecast and the whole thing could reverse within a month if we get it, not at critical point just yet IMHO. ( I've seen a few droughts back in my shearing days down in Canterbury)

couta1

11-03-2015, 12:48 PM

have you seen to Canterbury recently
No not for a while, I remember one year in the early 80s if I recall correctly when all the paddocks around mid Canterbury were just dirt and dust.

BlackPeter

11-03-2015, 01:04 PM

have you seen to Canterbury recently

Actually - it doesn't look too bad from where I sit (just in the middle of Canterbury ...). Yes, without irrigation the fields are brown (though green shoots showing up after the rain earlier this week). Just noticed its now again possible to get a peg into the ground without heavy equipment - and hey - most of the farmers around here have (working) irrigation anyway.

Overall not one of the better years, but have seen as well a number of worse years before at this place.

Obviously - farmers always complain. It is always either to dry or to wet or too windy or too hot or too cold - and if nothing of above applies than I am sure that we had in these rare and exceptional years either a terrible hail or too much snow. So, taking all this into consideration - this is just another of an endless row of terrible years. No fun in farming - and nobody makes money. I just can't understand why people don't prefer to sell their farms and burn the money instead, would be much easier and less complaining involved. But then - without complaining it wouldn't be fun, wouldn't it?

couta1

11-03-2015, 01:09 PM

Its all about lifestyle at the end of the day BP plus the fact that a lot of farms are generational so not given up come hell or high water.

Beagle

11-03-2015, 01:11 PM

Actually - it doesn't look too bad from where I sit (just in the middle of Canterbury ...). Yes, without irrigation the fields are brown (though green shoots showing up after the rain earlier this week). Just noticed its now again possible to get a peg into the ground without heavy equipment - and hey - most of the farmers around here have (working) irrigation anyway.

Overall not one of the better years, but have seen as well a number of worse years before at this place.

Obviously - farmers always complain. It is always either to dry or to wet or too windy or too hot or too cold - and if nothing of above applies than I am sure that we had in these rare and exceptional years either a terrible hail or too much snow. So, taking all this into consideration - this is just another of an endless row of terrible years. No fun in farming - and nobody makes money. I just can't understand why people don't prefer to sell their farms and burn the money instead, would be much easier and less complaining involved. But then - without complaining it wouldn't be fun, wouldn't it?

Mate you've absolutely nailed it. They're worse than a bunch of winging old retired Pom's complaining about their unreliable Rover car's. Even in a good year they seem to find plenty to complain about for goodness sake !!!

sb9

11-03-2015, 01:17 PM

Mate you've absolutely nailed it. They're worse than a bunch of winging old retired Pom's complaining about their unreliable Rover car's. Even in a good year they seem to find plenty to complain about for goodness sake !!!

Not to mention about their (Poms) skills in Cricket...ouch did I say that ;)

Jantar

11-03-2015, 01:42 PM

Most new Zealand farmers have seen similar conditions many times in the past and have set up their water storage and irrigation requirements to suit. The current drought is not as bad nor as widespread as the one 2 years ago, and no-where near as bad or widespread as the 2008 drought. They are hurting, as in possibly reduced income this year, but for those who have been through this before it will not change their farming practices.

The farmers who are hurting the most are those who have recently converted to dairy in semi arid areas, like Central Otago and mid Canterbury. Great when they have water, but may struggle to survive when the dry really hits.

tim23

11-03-2015, 04:20 PM

Farmers have the best union in the country fed farmers the whs cant complain about a wet summer and get govt relief

freddagg

11-03-2015, 06:08 PM

Farmers have the best union in the country fed farmers the whs cant complain about a wet summer and get govt relief

Rio Tinto complained about the price of Aluminum and got real cash, not just deferred taxation.

kiora

11-03-2015, 06:29 PM

And I thought the discussion was the likely profitability of PGW as a result of climatic and other conditions ???:scared:

tim23

11-03-2015, 07:37 PM

It is Kiora - but its fun to digress, I am a PGG holder though.

Beagle

12-03-2015, 09:49 AM

Rio Tinto complained about the price of Aluminum and got real cash, not just deferred taxation.

You need to differentiate between a one-off event clearly designed in the Govt's self interest in terms of maximising the float price of the gentailers and the significant amount of special provisioning and accommodation specially written into the Income Tax Act for farmers benefit on an ongoing basis.

Master98

12-03-2015, 12:12 PM

1080 threat will hit dairy industry, how much pgw will be affected? I know dairy is not major part of pgw but still will impact more or less i think. seems not many discuss here.

In4a$

12-03-2015, 01:38 PM

1080 threat will hit dairy industry, how much pgw will be affected? I know dairy is not major part of pgw but still will impact more or less i think. seems not many discuss here.
I dont think it will affect PGW much at all, am watching though, just in case it does drop then I can get some more.

Snoopy

13-03-2015, 12:14 AM

But why will FY16 be down? Because of the drought or commodity prices? Just trying to understand your concerns over Fy16

I think many farmers have reduced herds to just their capital stock to see themselves through the drought. With dairying, the lower payout hasn't hit yet in cashflow terms. Another drought in FY2016, should it happen, will not be good for farmers. If FY2016 ends up being OK, farmers will need time to rebuild their herds. To me the best possible outlook in FY2016 would see farmers getting back to where they were a year ago. I don't see another great leap forward for PGW in FY2016.

PGW has had a great year in sharemarket terms. So time to rebalance my portfolio a bit by taking some PGW money off the table. PGW is still my preferred pure rural economy exposure, even at 50c. So no further rebalancing is planned by me, for now.

SNOOPY

percy

13-03-2015, 08:18 PM

I drove to Timaru via Rakaia,Barhill,Mayfield,Carew, and Geraldine today.
Drought.?What drought!The amount of capital invested into farming today has altered not only the landscape,but the whole model of farming.Intensive farming,better land use,huge increases in productivity.This in turn means more employment opportunities,and better markets for rural supply firms.Cows yes,but intensive crop farming too.
Yes there are parts of the country where the term "dry land" farming is still correct, but it can not be said of The Canterbury Plains.
Other parts of the country are changing too.The "dry lands" of Blenheim are now huge grape producers.
These changes help to even out farmer's incomes,and hopefully stop the huge fluctuations of past years.

Beagle

13-03-2015, 10:17 PM

Good comment Percy. Going off the rain radar time lapse imaging on the Metservice site yesterday much of the North Island got a good drink yesterday.

kiora

14-03-2015, 04:25 PM

http://www.stuff.co.nz/business/farming/sheep/67324546/sheep-and-beef-are-doing-it-tough-in-drought?utm_source=ST&utm_medium=email&utm_campaign=ShareTrader+AM+Update+for+Saturday+14 +March+2015

Master98

14-03-2015, 06:27 PM

http://www.stuff.co.nz/business/farming/sheep/67324546/sheep-and-beef-are-doing-it-tough-in-drought?utm_source=ST&utm_medium=email&utm_campaign=ShareTrader+AM+Update+for+Saturday+14 +March+2015
beefs and lambs suffered from [IMG]http://www.sharetrader.co.nz/webkit-fake-

couta1

14-03-2015, 09:30 PM

Meanwhile Lamb wool prices jump to a 4 year high just to add a bit of balance to the pessimists.Hey Master98 those sheep in those images look in pretty good nick and i should know ive handled enough of them over the years;)

percy

16-03-2015, 01:57 PM

beefs and lambs suffered from [IMG]http://www.sharetrader.co.nz/webkit-fake-

Have to be the biggest fattest drought starved sheep I have ever seen.!!!

Beagle

16-03-2015, 02:01 PM

Good comment Percy. Going off the rain radar time lapse imaging on the Metservice site yesterday much of the North Island got a good drink yesterday.

Virtually the entire North Island got another really good drink overnight...drought breaker for the vast majority of farmers in the North Island.

sb9

16-03-2015, 02:41 PM

Virtually the entire North Island got another really good drink overnight...drought breaker for the vast majority of farmers in the North Island.

Yep, grass is definitely looking much greener today.

sb9

29-04-2015, 10:37 AM

Inching close to that 50c mark slowly, should expect good results for the year I think :), are you still in Roger on this one?

Beagle

29-04-2015, 11:00 AM

Inching close to that 50c mark slowly, should expect good results for the year I think :), are you still in Roger on this one?

Yep mate I am fairly relaxed with this stock...arguably the best diversified agri exposure with a compelling fully imputed dividend yield and undemanding PE ratio. In a market that looks very fully priced I think this is a very good hold. Depending upon annual results and outlook in due course I might double-down on this one.

percy

14-05-2015, 07:33 PM

I'm trying to find a nzx listed stock that has as negative of a correlation coefficient with PGW as possible.

Any suggestions? Thanks.

Suggest you look at PEB or WDT. Once you have found them,come home to PGW. lol.

Mista_Trix

21-05-2015, 02:56 PM

Jantar

21-05-2015, 03:26 PM

Mista_Trix

21-05-2015, 03:33 PM

PGW are stock and station agents. They sell agriculture equipment, but do not have a big association with dairy. Most of their clients are sheep and beef which are both doing quite well. Even when dairy farmers are having a bad spell they still need to keep fences repaired, electric fence units working, feed their dogs, have wet weather gear etc.

Overall the dairy down turn is bad news for dairy farmers, but should have little effect on PGW, Farmlands, RD1 etc.

Thanks Jantar, I have been trying to figure out how deep the link between them was. Assuming that at a macro level what is bad for one (dairy) likely impacts the other (sheep and beef), as I'm sure the profits (or lack of) from one industry mobilise into the others.

When I was down in the deep south recently for a holiday driving from Queenstown - Invercargill - Catlins and back, PGW seemed to be everywhere. So I have taken an interest purely from that point ... after seeing the P/E and Div I have become even more so.

Jantar

21-05-2015, 04:32 PM

...
Lamb value's have been down on last year for most of the season as well.And last season was up 40% on the previous one. I have a few lambs going to the works on tuesday, and I'm happy. :)

Snoopy

28-05-2015, 04:07 PM

PGW have a large water division which has performed particularly well, based on the dairy sector, in recent years.
This includes consulting, supply of product, installation and maintenance for irrigation, effluent, dairy shed reticulation and fit out, as well as pumps and stock water systems. These will all take a hit by the lower dairy pay out.

On p66 of AR2014, we learn that group revenue would have been $6.12m higher and (EBITDA?) profit would have been $0.17m higher if PGW had owned the newly acquired 'Water Dynamics and Aquaspec" for the whole of FY2014. This represents a margin of:

$0.17m/ $6.12m = 2.777%

PGW did not own this group from 1st July 2013 to 25th October 2013, the first 117 days of FY2014.

During the period that "Water Dynamics and Aquaspec" was owned, it contributed a profit of $1.08m (Operating EBITDA?). If we assume a constant profit margin, this implies a total revenue for "Water Dynamics and Aquaspec" for the FY2014 year of:

$6.12m + ($1.08m/0.02777) = $6.12m + $64.82m = $70.94m

PGW ceased to report a separate result for the irrigation division from FY2014. But if we go back to FY2013 (pre the "Water Dynamics and Aquaspec" acquisition), the legacy irrigation division reported an operating EBITDA of $5.024m on operating revenue of $45.161m (see segmented profit information). This means we can estimate the 'EBITDA' and 'Revenue' for the new expanded irrigation division for FY2014, assuming PGW owned all of "Water Dynamics and Aquaspec" for all of FY2014, as:

Irrigation Revenue FY2014: $45.16m+ $70.94m = $116.10m
Irrigation EBITDA FY2014: $5.02m + ($0.17m+$1.08m) = $6.27m

These two figures can be re-expressed as percentages of the total company figures:

Irrigation Percentage EBITDA (FY2014) = $6.27m / ($58.747m + $0.17m) = 10.6%
Irrigation Percentage Revenue (FY2014) = $116.10m / ($1,219.38m +$70.94m) = 9.0%

While the new combined irrigation is a significant sized business in its own right, I would argue that under the overall umbrella of the whole PGW empire. irrigation is not that large.

What does all that mean? It is possible that the PGW share price will be more resistant to a falling dairy price than you think Snapiti.

SNOOPY

discl: hold PGW

Beagle

28-05-2015, 04:09 PM

sb9

29-05-2015, 09:28 AM

Recommended this to one of my mates and he got in at 49c, couldn't agree more on the divvy yield and future prospects.

Snoopy

29-05-2015, 10:07 AM

So how does everyone think the continuing dairy slowdown will impact this share? At the moment an incredible P/E ratio with a strong DIV. But is this likely to change?

I'm not in at the moment but am considering, it just looks a little too good to be true...
... or has it just been overlooked by others?

Mista Trix, PGW is my preferred rural industry exposure because they have a wider and hence more balanced 'captive market' than any other rural player I can think of. I say 'captive market', because they tend to sell the basics needed to run farming operations every day rather than capital intensive extras (although irrigation systems are I guess an exception to that). I say 'wider' because some years ago they took over Fruitfed, the leading supplier to the fruit and vegetable sector. You will also be aware they market to those those farmers who make their returns from animals, be they ostriches or cows or sheep.

'Dairy' is always in the headlines, and CEO Mark Dewdney has himself stated PGW is looking to grow their market in that sector. That may sound counter intuitive given the general market outlook for dairy. But Dewdney was also the guy that offloaded PGW's share of their supplementary feed business. With hindsight, that looks to have happened at near the peak of that market. So I don't think you could argue that Dewdney is not astute.

I would prefer to see overall company debt levels a little lower. But then again controlling shareholder Agria, itself highly indebted, is in need of a steady dividend stream to pay down their own debt. And there is little doubt in my mind that the high dividend level of dividends being paid do support the PGW share price.

PGW is now out of the NZX50. Given that 50% of its shares are permanently locked up, and it is unlikely to ever return to the NZX50, analyst coverage is reduced. So yes, you can argue PGW is overlooked by the market. But buying shares in any rural business at the top of the market has in the past never been an astute move. Personally I do think earnings will be lower in the next few years. That means dividends will be lower too, as PGW currently pays out all of its earnings as dividends. For this reason, I have been reducing my own holding. But provided PGW forms an appropriate part of a balanced portfolio, I can see the argument for buying in at today's dividend levels too. IMO many other rural shares in the market are currently very fully valued. So longer term, while PGW remains 'fair value', I can't see PGW being usurped as my principal rural sector investment.

SNOOPY

sb9

09-06-2015, 10:43 AM

Wonder anyone has thoughts on recent weakness in price. Seem a lot of selling pressure with big volume on offer....

May be weaker dairy prices outlook one of the reasons?

Biscuit

09-06-2015, 10:50 AM

Wonder anyone has thoughts on recent weakness in price. Seem a lot of selling pressure with big volume on offer....

May be weaker dairy prices outlook one of the reasons?

I would look at the last paragraph of Snoopy's post above for an answer.

nextbigthing

09-06-2015, 03:55 PM

Wonder anyone has thoughts on recent weakness in price. Seem a lot of selling pressure with big volume on offer....

May be weaker dairy prices outlook one of the reasons?

I wonder if one of the funds is getting spooked and taking some chips from the table, I've noticed a few 'blue chip divvy stocks' getting a slight rinsing the last couple of days.

James108

09-06-2015, 08:27 PM

Might top up if it gets a bit lower.

Agrarinvestor

10-06-2015, 08:37 AM

Agria up on heavy volume. Can we expect strong earning from PGW or what is the reason ?

nextbigthing

10-06-2015, 08:52 AM

Agria up on heavy volume. Can we expect strong earning from PGW or what is the reason ?

What portion of Agria's profits does the dividend stream from PGW make up?

sb9

10-06-2015, 01:43 PM

Hmmm...that's quite a weakness in sp. Based on divvy yield, this should be bargain on market atm...

Snoopy

10-06-2015, 03:10 PM

What portion of Agria's profits does the dividend stream from PGW make up?

Last time I checked Agria had only token investments of its own in China. So within the margin of error the answer to your question is 100%.

SNOOPY

winner69

10-06-2015, 03:12 PM

I sense we will buying at 35-40 cents before winter is over

nextbigthing

10-06-2015, 03:34 PM

I sense we will buying at 35-40 cents before winter is over

Based upon?

Fingers crossed anyway

Master98

10-06-2015, 04:06 PM

I sense we will buying at 35-40 cents before winter is over

I put buy order at42c, seems you are more pessimistic than me.

winner69

10-06-2015, 04:22 PM

Based upon?

Fingers crossed anyway

Just the way market sentiment about primary industries is at the moment and the squiggly line is following

Around 40 cents been solid interest past but might overshoot ....hence 35 to 40

What was price at the time of that Agria carry on

Master98

10-06-2015, 04:28 PM

pgw has two trading updates each year in June and December, might be safe to buy in just after update.

Joshuatree

10-06-2015, 04:37 PM

Read more » (http://sendy.tarawera.co.nz/l/QQMrKma8h6MjbHw96gBRew/763wHsAblBpPV4z3jUo8HxOg/2YppPeqXe6d97Upr5kfM4w) Ministry tips rebound in farm sector

winner69

10-06-2015, 04:45 PM

dairy woes weighs on primary sector

http://home.nzcity.co.nz/news/article.aspx?id=208103&fm=psp,tsf

winner69

10-06-2015, 04:48 PM

That kpmg report

http://www.kpmg.com/NZ/en/IssuesAndInsights/ArticlesPublications/agribusiness-agenda/Documents/KPMG-Agribusiness-Agenda-2015-vol1-Growing-Value.pdf

Will somebody report back what it says, please

Crackity

10-06-2015, 04:57 PM

68 pages of glossiness - it says to me KPMG got a six figure sum....

you are welcome Winner

Agrarinvestor

10-06-2015, 07:29 PM

For FY 14 100%. But 2014 was a year of transition. Agria disposed the Vegetable business in China, significantly scaled back on the unprofitable and capital-intensive Field Corn business and focused on Edible Corn and on profitable Field Corn. Therefore Revenue in China came down and Gross Margin up. I'am betting on a turnaround for the China market in 2015.
FY14 was for AGRIA (including PGW) the first profitable year since years. Agria is trading with a P/E of 11.
Agria added a new director:
http://finance.yahoo.com/news/agria-announces-member-board-directors-123000523.html
If i look to the vita, i fear a privatisation of Agria. Going private is my greatest concern in my Chinese Investment.

But the strong move yesterday can be related to the announcement of subsidies:
http://www.globaltimes.cn/content/925969.shtml

sb9

12-06-2015, 12:21 PM

https://nzx.com/companies/PGW/announcements/265624

Looks very positive...

percy

12-06-2015, 12:25 PM

https://nzx.com/companies/PGW/announcements/265624

Looks very positive...

Certainly is..
Looks as though the divie is safe....

sb9

12-06-2015, 12:31 PM

Certainly is..
Looks as though the divie is safe....

Very tempting to add more at this level, thoughts Percy??

percy

12-06-2015, 12:59 PM

Why not? As long as your PGW investment is part of a "balanced portfolio."I have a spread in the agriculture sector,CVT,SCL,SEK and REL [on the unlisted market].I hold PGW mainly for yield. Any growth will be hard fought and modest.
We know the outlook for the rural sector is challenging,however Mark Dewdney did say;" We still feel PGW is well placed to trade through any weakness in the market and capitalise upon the opportunities available."

PS.I do prefer SEK and SCL. I think both have better growth prospects.

James108

12-06-2015, 01:15 PM

I have always considered the divvy safe for this year (with worst case a small decrease). I believe it is the outlook for the next few years which have caused the recent weakness in SP. Not that I will be selling any time soon. I think the expected yield from PGW should be calculated as an average over the economic/agriculture cycle and looking back since before the GFC I think the fundamentals still stack up, assuming problems with upper management have been sorted out.

Disc Holder

sb9

19-06-2015, 09:43 AM

2M gone thro' at 47c, should take the pressure off on the sell side now...

Agrarinvestor

25-06-2015, 02:09 AM

2M gone thro' at 47c, should take the pressure off on the sell side now...

Agria, the majority shareholder is approaching 2$. Gentleman, why are you fearing chinese agriculture Stocks. NZ shareholder support would not be bad.
I think NZ Investors have a good reputation in China, and can help in establishing a respectful relation to the Investor Relation departments of many chinese small Caps.
China is currently buying companies in all over the world. I don't expect more frauds, the remaining US listed chinese stocks have a solid business running.

http://www.iatp.org/files/2014_03_26_FeedReport_f_web.pdf

http://www.iatp.org/documents/the-need-for-feed-china%E2%80%99s-demand-for-industrialized-meat-and-its-impacts

tim23

25-06-2015, 07:05 PM

Bought some more PGG this week, happy at approx. 10% net yield - market seems not to trust PGG yet but I reckon deserves to be priced better, anyway will look to top up again if remain at this level.

see weed

25-06-2015, 11:26 PM

Bought some more PGG this week, happy at approx. 10% net yield - market seems not to trust PGG yet but I reckon deserves to be priced better, anyway will look to top up again if remain at this level.

Leave some for me. Just waiting to see what happens with atm.

Agrarinvestor

26-06-2015, 12:48 AM

Agria Subsidiary PGG Wrightson Announces Acquisitionhttp://finance.yahoo.com/news/agria-subsidiary-pgg-wrightson-announces-123000455.html

Snoopy

26-06-2015, 01:14 PM

Agria Subsidiary PGG Wrightson Announces Acquisitionhttp://finance.yahoo.com/news/agria-subsidiary-pgg-wrightson-announces-123000455.html

Announced by PGW itself at 10am yesterday. The aquisition of a turf irrigation business "Advanced Irrigation Limited", which plugs into the golf course market looks good. Especially as per capita NZ has rather a lot of golf courses! The acquisition is small, but is indicative of Mark Dewdney's strategy of further strengthening the irrigation are of the business. Looks good to me.

Meanwhile the stock supply agreement with Silver Fern farms that caused all sorts of write offs a few years ago has been terminated.

------

"that agreement was entered into at a different time and it was agreed that
it was no longer needed to regulate the livestock procurement relationship.
PGW has supplied agency procurement for SFF for many years and both parties
are confident that that this relationship will continue to develop and
strengthen without the formality of a prescriptive agreement."

"We have often found that the agreement was not flexible enough to respond to
seasonal and climatic changes that regularly occur in the livestock business.
We feel that the maturity of the relationship we have with SFF means that we
are both better off to focus our efforts on working together to deliver an
agency service that best accommodates our farmer customers and SFF
collectively."

-----

Good riddence to that!

SNOOPY

iceman

06-07-2015, 08:49 PM

Not a good look http://www.stuff.co.nz/business/farming/70001956/pgg-wrightson-livestock-division-investigated-by-commerce-commission

winner69

06-07-2015, 09:26 PM

Not a good look http://www.stuff.co.nz/business/farming/70001956/pgg-wrightson-livestock-division-investigated-by-commerce-commission

We need to do the we not guilty trick but front up with best part of a million settlement and promise processes in place to stop ripping of our customers.

PLYNCH

08-07-2015, 01:48 PM

R.I.P. Craig Norgate

BlackPeter

08-07-2015, 02:00 PM

R.I.P. Craig Norgate

Yes - nobody deserves to die that early and certainly a tragedy for the family.

Just hope that nobody starts now talking about his business acumen - too often shareholders had to pay for his mistakes.

Yes - he had interesting ideas, and certainly charisma and vision, but he was not that great in managing anything - be it companies or risk. Here is a good article about him: http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10643472

winner69

08-07-2015, 02:19 PM

Yes - nobody deserves to die that early and certainly a tragedy for the family.

Just hope that nobody starts now talking about his business acumen - too often shareholders had to pay for his mistakes.

Fonterra and PGG Wrightsons wouldn't be what they're today if it wasn't for Norgate (some say visionary)

BP, as you say shareholders might think other things.

winner69

08-07-2015, 02:21 PM

Yes - nobody deserves to die that early and certainly a tragedy for the family.

Just hope that nobody starts now talking about his business acumen - too often shareholders had to pay for his mistakes.

Yes - he had interesting ideas, and certainly charisma and vision, but he was not that great in managing anything - be it companies or risk. Here is a good article about him: http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10643472

Good article there BP

Under Surveillance

08-07-2015, 05:53 PM

Yes - he had interesting ideas, and certainly charisma and vision, but he was not that great in managing anything - be it companies or risk.
He certainly wasn't that great in managing his weight, and his vision didn't extend to averting the consequences of it.

Beagle

08-07-2015, 06:07 PM

Yes - nobody deserves to die that early and certainly a tragedy for the family.

Just hope that nobody starts now talking about his business acumen - too often shareholders had to pay for his mistakes.

Yes - he had interesting ideas, and certainly charisma and vision, but he was not that great in managing anything - be it companies or risk. Here is a good article about him: http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10643472

Thanks BP...I think that's a fair synopsis of his chequered track record.

kiwidollabill

08-07-2015, 08:03 PM

Heard from someone who knew him today "He was a bit of a cowboy..."

But yea, RIP for someone relatively young to leave his family like that

sb9

15-07-2015, 09:57 AM

PGG Wrightson Acquires Strategic Interest in Uruguay

https://nzx.com/companies/PGW/announcements/267017

Beagle

15-07-2015, 10:28 AM

PGG Wrightson Acquires Strategic Interest in Uruguay

https://nzx.com/companies/PGW/announcements/267017

On the face of it, it looks good. I think a few other companies could take a leaf out of their book by paying a price, (hopefully a low one, some more detail on whether this is eps accretive from year 1 would have been nice), with earn out provisions over the next 3 years. Looks like a well structured deal from what little detail was supplied but I am looking forward to hearing more about it in due course at the ASM. The fact that they know the business well from their strong existing business relationship should give shareholders comfort this is a positive acquisition for PGW.

BlackPeter

15-07-2015, 10:29 AM

PGG Wrightson Acquires Strategic Interest in Uruguay

https://nzx.com/companies/PGW/announcements/267017

Oh dear, they hardly managed to consolidate their business in NZ and already out for the next big South American adventure. I hear it is a lovely continent for a business trip. Just hope that this time it is not again just the travel bills and another huge capital loss (NZS) for the shareholders. At least it looks like they don't plan to run farms ... just sell to them.

Time to sell while the SP is still up?

sb9

15-07-2015, 10:40 AM

Well, I see it as a positive announcement and as per Roger will look forward for more details at the next ASM.

see weed

15-07-2015, 10:42 AM

Oh dear, they hardly managed to consolidate their business in NZ and already out for the next big South American adventure. I hear it is a lovely continent for a business trip. Just hope that this time it is not again just the travel bills and another huge capital loss (NZS) for the shareholders. At least it looks like they don't plan to run farms ... just sell to them.

Time to sell while the SP is still up?

Thank you BP, I will take them off you for that price. Been collecting these for the last couple of weeks:).

Beagle

15-07-2015, 10:42 AM

Oh dear, they hardly managed to consolidate their business in NZ and already out for the next big South American adventure. I hear it is a lovely continent for a business trip. Just hope that this time it is not again just the travel bills and another huge capital loss (NZS) for the shareholders. At least it looks like they don't plan to run farms ... just sell to them.

Time to sell while the SP is still up?

It looks like a good strategic fit to me mate and I am happy to take their NZX release stating this acquisition has had strong growth at face value. Surely a man with your experience can see the obvious synergies !!

percy

15-07-2015, 10:46 AM

Oh dear, they hardly managed to consolidate their business in NZ and already out for the next big South American adventure. I hear it is a lovely continent for a business trip. Just hope that this time it is not again just the travel bills and another huge capital loss (NZS) for the shareholders. At least it looks like they don't plan to run farms ... just sell to them.

Time to sell while the SP is still up?

Yes/No.
Mark Dewdney did say some time ago, that they had stopped repaying debt, and were concentrating on investing in the business.
I see this as a well thought out continuation of this.

BlackPeter

15-07-2015, 11:21 AM

It looks like a good strategic fit to me mate and I am happy to take their NZX release stating this acquisition has had strong growth at face value. Surely a man with your experience can see the obvious synergies !!

Hi Roger (et all). Agree they talk synergie, which must be a positive word (but then - it is probably as well the most abused word in the vocabulary of any CEO justifying anything they don't have a business case for) and yes, from the sound of it it might make sense and was hopefully not too dear. It's just that PGW had in its past spectacular examples for failing to do proper due diligence before jumping into the deep end (Silverside, NZS to name just a few) and obviously executives who might want to catch up with friends in Uruguay from their NZS phase. So I guess it would be nice to get this announcement with a bit more spice (data) instead of just hoping that they did this time a better job in analysing the opportunity.

I am sitting so far on the fence re this "opportunity" - and hope they don't disappoint again ...

percy

15-07-2015, 11:39 AM

I think PGW has been transformed back to a well run organisation, providing excellent products and services to their customers.
They are customer focussed.Having had a "tight" balance sheet,upgrading the business has meant they have had to reinvest with caution.
I would therefore think, any acquisition has been very carefully analysed.I have noted in my travels around Canterbury, PGW branches have been spruced up.In fact they are looking good. Could be said the business is "well positioned."

Snoopy

15-07-2015, 11:44 AM

Again there has been a slight shift in the reporting details for FY2014. Profitability figures for South America are no longer quoted. I am always suspicious when detail like this disappears from a report, and ask the question:

"What have management got to hide?"

Note 4 does report the revenues though: down from $NZ118.674m (FY2013) to $NZ110.880m (FY2014). Uruguay and ultimately Brazil has always been the add on with potential. South America is of course small, only 10% of sales and rather less than that in profits, in the grand scheme that is PGW now. But IMO those South American sales figures are a disappointing result. I predict PGW will continue to 'stumble along' in South America, as it has for ten years, with no increase in eps coming from there in FY2015. With the growth engine stalled, that is enough to remove any growth premium for the PGW share price going forwards IMO.

I wrote the above nearly a year ago. So I am quite pleased to see progress in South America. My only doubt is with 'Agrocentro Uruguay' being both a major supllier to PGGW in Uruguay.

"PGG Wrightson Seeds has been a key strategic partner and has supported Agrocentro Uruguay from its conception. Agrocentro Uruguay is PGG Wrightson Seeds’ largest customer in South America. It is also the biggest seed producer for PGG Wrightson Seeds and an important seed processor."

It might have been devastating for PGGW in Uruguay if 'Agrocentro Uruguay' has fallen into hostile hands. So I hope it wasn't bought just to protect PGW's uncompetitive (gulp did I say that?) patch in Uruguay. No more extra junkets for management here, because they have had a presence in Uruguay for the last dozen or so years anyway. To me it looks like the next step in Mark Dewdney's careful evolution of the business. I see no reason to think about selling more of my PGW shares because of this acquisition.

SNOOPY

sb9

15-07-2015, 02:58 PM

From NBR online...

Uruguay buy protects PGG Wrightson's $US100m business
PGG Wrightson’s [NZX: PGW (https://nzx.com/markets/NZSX/securities/PGW)] purchase of a half stake in a retail rural supplies company in Uruguay will help protect its position with its biggest customer in a market worth well over $US100 million a year to the company, chief executive Mark Dewdney says.
PGG Wrightson is buying the stake in Agrocentro Uruguay for an undisclosed sum, signalling the price is below the threshold specified in NZX listing rules.
Mr Dewdney says his company has paid “a relatively small amount of money upfront and then we have an earn-out based on the financial results for the next three years.”
Although details will remain confidential for now, they will be disclosed in next year’s annual report – the transaction has missed the June 30 cut-off date to be included in this year’s report.
The purchase price is going to the existing two shareholders but the parties have agreed to jointly provide fresh capital if and when the business needs it, Mr Dewdney says.
PGG Wrightson has supported Agrocentro since it was founded in 2007 and it now has 120 staff and eight retail stores.
Mr Dewdney explains why his company wanted an ownership interest in the largest customer of its seeds business in Uruguay.
“The ownership interest secures them as a channel to the market for us. It gives us the ability to directly participate in the future strategic direction of their business and it gives us the ability to share in the margins at the retail end of the business,” he says.
Ownership provides security
“As a customer of ours, they could buy seed from others – they still might, even with our ownership, but, as our biggest customer, there’s some vulnerability if you just have a supplier/customer relationship.
“Ownership gives us more security.”
Mr Dewdney says the business is similar to PGG Wrightson’s retail business in New Zealand.
“The strength of our New Zealand business is the fact that we’re the manufacturer, the wholesaler and the retailer and we can connect our individual farmers right back to the point of manufacture,” he says.
“That’s the strength of our New Zealand business model and this is essentially replicating that, or rounding it out, as much as we can in Uruguay,” he says.
“It’s another part of rounding out our strategy in areas we see as key to future growth and we’re not betting the farm.”
PGG Wrightson’s purchase comes in the same month as former chairman Craig Norgate dying.
Mr Norgate served on PGG Wrightson’s board between 2004 and 2010 during which time it expanded aggressively into Uruguay and in 2006 established NZ Farming Systems Uruguay, a company later taken over by Singapore’s Olam.
Mr Dewdney says he noted Mr Norgate’s death with sadness but that there was no connection with the company’s latest investment in Uruguay.
“We’ve been investing in Uruguay for years – we’re building a new logistics centre there at the moment,” he says.
“We sold out of the farm-owning business and have no intention of going back into something like that but we haven’t actually stopped investing in Uruguay.”

Beagle

15-07-2015, 03:22 PM

Thanks mate. All makes sense to me.

percy

16-07-2015, 09:29 PM

Lightened my exposure to NZ's rural sector today selling our PGW holding.

Master98

16-07-2015, 10:23 PM

Lightened my exposure to NZ's rural sector today selling our PGW holding.

you sell your "well positioned" business?, anyway only 270k shares traded today just half of my holding.

percy

16-07-2015, 10:31 PM

you sell your "well positioned" business?, anyway only 270k shares traded today just half of my holding.

Well you remain "very well positioned."
No,fortunately I did not hold 270,000 shares.
I have however retained my shares in CVT, PAZ & REL [both unlisted market],SCL, SEK,and Tru-Test.
Tru-Test is very exposed to the dairy sector,so will struggle.

Master98

16-07-2015, 10:47 PM

Well you remain "very well positioned."
No I did not have 270,000 shares.
I have however retained my shares in CVT, PAZ & REL [both unlisted market],SCL, SEK,and Tru-Test.
Tru-Test is very exposed to the dairy sector,so will struggle.
you should sell your HNZ shares and take the money from the table and increase your pgw holding ,I put my faith in current pgw management, they grow the company without raise any capital from share holders and pay decent dividend, I sold previous holding at 52c now bought it back from 45c.

see weed

16-07-2015, 11:27 PM

Master98

17-07-2015, 06:57 AM

That's funny, I bought 40k at 52c on 6/3/15, were they yours?:mellow:
could be part of those:)

percy

17-07-2015, 07:25 AM

you should sell your HNZ shares and take the money from the table,I put may faith in current pgw management, they grow the company and didn't raise any capital from share holders and pay decent dividend, I sold previous holding at 52c now bought back from 45c.

Thank you for your advice.
I prefer my own counsel.
I would never tell you to buy or sell your PGW.That is your decision.
As I post often on sharetrader,I think it is only right to disclose I have sold out of a company,as I usually post when I have brought into a company.
I sell books to schools.Shares have been a life long hobbie.I was told if you got 6 out of 10 picks right you would make money.Over the years I have gone from about 3 out of 10 to currently 9 out of 10,so I trust my own judgement.

Master98

17-07-2015, 07:37 AM

Thank you for your advice.
I prefer my own counsel.
I would never tell you to buy or sell your PGW.That is your decision.
As I post often on sharetrader,I think it is only right to disclose I have sold out of a company,as I usually post when I have brought into a company.
I sell books to schools.Shares have been a life long hobbie.I was told if you got 6 out of 10 picks right you would make money.Over the years I have gone from about 3 out of 10 to currently 9 out of 10,so I trust my own judgement.

Thank you for your advice.
I prefer my own counsel.

I think PGW has been transformed back to a well run organisation, providing excellent products and services to their customers.
They are customer focussed.Having had a "tight" balance sheet,upgrading the business has meant they have had to reinvest with caution.
I would therefore think, any acquisition has been very carefully analysed.I have noted in my travels around Canterbury, PGW branches have been spruced up.In fact they are looking good. Could be said the business is "well positioned."

you can change you analysis just in days:D, not trustable.

couta1

17-07-2015, 07:43 AM

Seems to me that both Percy and Master are both doing very well but in different ways, Percy being more of a long term investor and Master more of a swing trader.

sb9

17-07-2015, 07:51 AM

Lightened my exposure to NZ's rural sector today selling our PGW holding.

Respect your own decision percy re selling your holding in PGW. But just wondered, with results due out in 3 weeks on the back of recent profit upgrade, thought you could've waited until that time. I'm sure though if you've very personal reasons for that.

Master98

17-07-2015, 07:52 AM

Seems to me that both Percy and Master are both doing very well but in different ways, Percy being more of a long term investor and Master more of a swing trader.

couta, i can confirm i am not a trader, more like a active investor.

percy

17-07-2015, 07:52 AM

you can change you analysis just in days:D, not trustable.

When I see changes happening I act straight away.Can be within minutes.
I think PGW is a fine company.
However, I wanted to cut my exposure to the rural sector.The likes of CVT, PAZ,SCL and SEK should benefit from falling $ more than PGW.REL I wanted to retain,while Tru-Test is very illiquid.
So selling PGW brought my exposure to the rural sector to where I wanted.
I leave others to decide whether they trust me or not.I have always posted my views honestly.

percy

17-07-2015, 07:54 AM

Respect your own decision percy re selling your holding in PGW. But just wondered, with results due out in 3 weeks on the back of recent profit upgrade, thought you could've waited until that time. I'm sure though if you've very personal reasons for that.

I expect the result will be excellent.
You may note I have also sold out of AWF,again a share I have held for a number of years.
I am just altering the portfolio a bit.I have recently brought AWK,IQE and a couple of small cap Aussie shares.Also carrying more cash.I am undecided whether to add to our RYM and SUM.

couta1

17-07-2015, 07:56 AM

couta, i can confirm i am not a trader, more like a active investor.
Master that post would make a great tui billboard.

Beagle

17-07-2015, 09:01 AM

I sold my holding in HNZ but increased my holding in PGW. In tough economic conditions people default on their debt, other loans are rescheduled and deferred and otherwise amortised over longer periods but are intrinsically toxic debt nonetheless...toxic debt that financial institutions are very reluctant to crystallise until the auditors force them too...witness the Euro loans to Greece as a prime example. OTOH people still need seeds, irrigation, farm supplies e.t.c. and PGW's exposure to the dairy sector is small. Further their gross dividend yield is substantially superior to HNZ. Further still, PGW offers the most diversified agri exposure on the NZX by far and while one sector may be struggling others are performing well, irrigation and beef to name just two.

Beef is going absolute gang-busters...(I have been working for the last two weeks on a major clients books and the draft figures have really blown me away, BY FAR the best I have seen in 20 years of doing their books), and yet OTOH we know HNZ have stated they are targeting loan growth to sharemilkers...the ones who's operations are going down the drain...go figure ?
PGW are out of this lending to farmers business and this is now HNZ's problem.

Despite the incessant ramping on HNZ's thread I am happy to back my own judgement.

Perhaps worth noting that my opinion is backed by the analyst community with one buy, one outperform and one hold by analysts
http://www.4-traders.com/PGG-WRIGHTSON-LIMITED-6497113/consensus/
On the other hand we have HNZ with two holds and one underperform.
http://www.4-traders.com/HEARTLAND-NEW-ZEALAND-LTD-11344518/consensus/
(Not to be misinterpreted that I follow analysts per se. I always make up my own mind).

Biscuit

17-07-2015, 10:09 AM

Thank you for your advice.

As I post often on sharetrader,I think it is only right to disclose I have sold out of a company,as I usually post when I have brought into a company.

I think that is a good approach.

percy

17-07-2015, 10:17 AM

Master98

17-07-2015, 10:55 AM

Note 4-traders.
PGW eps.; 2014 .... 5.6.....2015....5.10.....2016.....4.30...... 2017.....5............Stagnant..
HNZ eps.;2014 ........9.......2015.....9.7.......2016....10.4... ....2017.....12.2......Growth.
percy, i pretty sure 4-traders not yet factor in current dairy collapse which heavily impact HNZ forwards.
also not yet factor in PGW earnings upgrade twice.

percy

17-07-2015, 11:15 AM

percy, i pretty sure 4-traders not yet factor in current dairy collapse which heavily impact HNZ forwards.
also not yet factor in PGW earnings upgrade twice.

.
Just thought as Roger had quoted them,he should have quoted what I thought was important.
I would think the dairy collapse would work more against PGW,than HNZ who have very little exposure to the sector..
From Tru-Test's outlook;
"the current uncertainty in the NZ dairy sector is having on the NZ farming sector.While we expected the NZ market to be impacted this year the extent of reduced farmer spending has been greater than expected."

Master98

17-07-2015, 11:25 AM

.
Just thought as Roger had quoted them,he should have quoted what I thought was important.
I would think the dairy collapse would work more against PGW,than HNZ who have very little exposure to the sector..
From Tru-Test's outlook;
"the current uncertainty in the NZ dairy sector is having on the NZ farming sector.While we expected the NZ market to be impacted this year the extent of reduced farmer spending has been greater than expected."

PGW has insisted they have most diversified agri exposure and dairy only count very small, pgw is very smart to sold their finance arm PGWF to HNZ years ago, it was a smart move and HNZ hold this hot potato.

percy

17-07-2015, 11:35 AM

PGW has insisted they have most diversified agri exposure and dairy only count very small, pgw is very smart to sold their finance arm PGWF to HNZ years ago, it was a smart move and HNZ hold this hot potato.

Reread the Tru-Test statement again.
HNZ taking over PGWF has been good for both.Like PGW, HNZ have little dairy exposure.
Yet PGW has total exposure to the rural sector.

Beagle

17-07-2015, 12:32 PM

PGW has insisted they have most diversified agri exposure and dairy only count very small, pgw is very smart to sold their finance arm PGWF to HNZ years ago, it was a smart move and HNZ hold this hot potato.

Agree 100%.

Percy with the greatest of respect mate HNZ are on public record with their half year report back in February saying they are targeting loan growth to sharemilkers. The master has this right, IMO brokers have not taken into account loan write-off's from the dairy sector for FY16 and FY17 in HNZ's projections...recall the really brutal dairy declines have only occurred in the last two weeks or so.

Anyway back to the thread topic. Yes its clear that FY16 will be a little more challenging for PGW but management pointed out in their recent FY15 guidance update the company is very well positioned to handle the challenges of 2016, or words to that effect.

James108

17-07-2015, 12:37 PM

I expect PGW earnings to be stagnant. Even if they go as low as 4 EPS I would still be happy. That is still 11.8% gross return on my average purchase price.

Master98

17-07-2015, 02:15 PM

F.Y.I

http://www.stuff.co.nz/business/farming/markets/69861591/store-lambs-reach-high-of-94
Store lambs reach high of $94

http://www.stuff.co.nz/business/farming/markets/70291759/stable-wool-market-for-farmers
Stable wool market for farmers

tim23

18-07-2015, 07:23 PM

James - last year they paid out 4c plus 1c special so that could happen again but you are right 4c is wonderful in its own right, just bought some more myself, figured was better than sitting in my Rabo call account.

Master98

18-07-2015, 08:48 PM

winner69

18-07-2015, 09:02 PM

I quite sure last year pgw paid 2.0c interim and 3.5c final.

I think you are right Master - and a 2 cent interim this year

The 3.5 cent final did include a 1.0 cent special component.

see weed

18-07-2015, 09:22 PM

I think you are right Master - and a 2 cent interim this year

The 3.5 cent final did include a 1.0 cent special component.

That's right. Have made thousands of dollars on pgw dividends and sp ups in the last year, and expecting another

tim23

18-07-2015, 09:26 PM

Thanks - .5c more than I remember so its 9.6% net @ 47c what a deal!

Beagle

19-07-2015, 05:13 PM

Thanks - .5c more than I remember so its 9.6% net @ 47c what a deal!

Yep, last year they paid 5.5 cents in total inclusive of the 1 cent final special dividend so on current price of 47 that's 11.7% net or 16.25% gross !!!!!!!!
Let's remember that underlying earnings are up this year !! I'm like a hungry beagle dog sitting by its food bowl waiting for its next HUGE dividend feed :D

see weed

20-07-2015, 11:48 AM

Yep, last year they paid 5.5 cents in total inclusive of the 1 cent final special dividend so on current price of 47 that's 11.7% net or 16.25% gross !!!!!!!!
Let's remember that underlying earnings are up this year !! I'm like a hungry beagle dog sitting by its food bowl waiting for its next HUGE dividend feed :D

Yep me to, just took out 0.475 and 0.48c:t_up:

Master98

23-07-2015, 10:08 AM

https://nzx.com/companies/PGW/announcements/267326

they grow business without raise any capital from share holders how good it is.

percy

23-07-2015, 10:15 AM

https://nzx.com/companies/PGW/announcements/267326

they grow business without raise any capital from share holders how good it is.

Very good.

Master98

23-07-2015, 10:23 AM

Very good.
appreciate you agree.

Beagle

23-07-2015, 10:31 AM

Master98

23-07-2015, 11:01 AM

Looks good but I would reiterate the same message as the last acquisition. While it looks good some more detail regarding cost and effect on EPS would have been nice. Something to bring up at the next ASM...shareholders want more detail. I am sure we all absolutely love the phrase EPS accretive, which is missing from either acquisition news release.
I hold, and am slightly nervous about them not mentioning the key term "EPS accretive"

copied from stuff:

The price that would be paid, including the earnouts over three years, would be in the range of 3.5-5 times Agrocentro's earnings before interest, tax, depreciation and amortisation (ebitda), Dewdney said, and both parties were happy with that.
Agrocentre had revenues of about US$35 million a year, impressive growth for a company that started from scratch eight years ago. PGW's business in Uruguay was worth about US$100m a year.

Ad Feedback (http://stuff.co.nz/about-stuff/advertising-feedback/?pos=storybody&adsize=300x250&area=onl.stuff.business/farming/agribusiness)

It was like PGW in the services it provided, mostly to the beef, sheep and cropping farming community, Dewdney said, and it was one of the bigger farm servicing companies in Uruguay.

Beagle

23-07-2015, 11:08 AM

copied from stuff:

The price that would be paid, including the earnouts over three years, would be in the range of 3.5-5 times Agrocentro's earnings before interest, tax, depreciation and amortisation (ebitda), Dewdney said, and both parties were happy with that.
Agrocentre had revenues of about US$35 million a year, impressive growth for a company that started from scratch eight years ago. PGW's business in Uruguay was worth about US$100m a year.

Ad Feedback (http://stuff.co.nz/about-stuff/advertising-feedback/?pos=storybody&adsize=300x250&area=onl.stuff.business/farming/agribusiness)

It was like PGW in the services it provided, mostly to the beef, sheep and cropping farming community, Dewdney said, and it was one of the bigger farm servicing companies in Uruguay.

Thanks mate. I am VERY HAPPY INDEED with those acquisition metrics.