PGW - PGG Wrightson

[Doyle]

Do us all a favour root and hold off. Still reasonably good volume today simply run out of sellers due to the massive volume this week. Could acheive a 66 close today unless some serious sellers come back to the market.

[root]

This peak is the same size as the last one looking at OHLC data, a high of 67 and a close of 66. I'd be happier if we crept a little higher tomorrow before heading into the next low. (Resisted the urge to sell)

[rabcat]

"Every man and their farm dogs in NZ that have gone into South America have been burnt bad, this includes Fonterra."

I dont see that PGW's venture into South America as a failure, in fact from what I can see it will become one of shining lights of the company over the coming years as world economies improve. The problem with PGW has not been its vision, Craig Norgate has plenty of that! The problem has been the strategy for implementing the vision which has been the problem.
I hope that PGW dont become introverted and cant see past NZ. After all we are a very small country in a very big world. If PGW can take their expertise and sell that world wide ( South America, China, Australia) all the talk about $40m or $50 million profit will be a drop in the bucket. This company has the potential to become a global player if it can get its execution right.
With some of the changes which are occuring on the board then I believe that they may be able to achieve that over the coming years.

[Dr_Who]

Had a chat with a person in the rural sector in the weekend. The drought in the north island is pretty devastating.

[Dr_Who]

PGW should merge with ELD.

[asc4]

Gradually moved sideways and down to this low.Any chance of seeing a bounce off .60/.61 to .68 or .70 soon? Or are investors still keen to stay de-risked at the moment?

Any ideas?

[flyingfox]

Gradually moved sideways and down to this low.Any chance of seeing a bounce off .60/.61 to .68 or .70 soon? Or are investors still keen to stay de-risked at the moment?

Any ideas?

God knows mate, but compare to NZX50 PGW shows the resistence, i dont think it will go down any further at least

[asc4]

God knows mate, but compare to NZX50 PGW shows the resistence, i dont think it will go down any further at least

Hey FlyFox, well unfortunately PGW seems to have taken a hit...down 5% yesterday..ouch!! :eek:

The lack of growth in the NZX over the last month has really taken its toll on the PGW SP.

I think we will see an improvement over the week (FTSE up last night, some positive news last week, US open tonight etc.) and a possible build up closer to the Half Year Results Announcement on Feb 25th. I think it will show PGW getting its act together.

2010 is going to be good for agriculture.

Just my thoughts.

Disc: Hold..and trying to stay cool :cool:

[root]

Hey asc4,

I hope you're right, I always get nervous when a stock takes a plunge just before reporting. The riskier stocks do move around a bit more with global influences like we are seeing at the moment. I'll be interested in reading the disclosure.

[percy]

Hey asc4,

I hope you're right, I always get nervous when a stock takes a plunge just before reporting. The riskier stocks do move around a bit more with global influences like we are seeing at the moment. I'll be interested in reading the disclosure.

I am also a little nervous.Must admit I am sure we have the long term right.
Strong brand,good management in place,strong balance sheet will reward us.

[asc4]

ANN: PGG Wrightson Finance has secured a BB (stable) rating from international credit rating agency Standard & Poors, confirming its place amongst the top tier of finance companies in New Zealand.

“Despite the challenging economic environment in New Zealand, PWF has achieved good profitability in the past three years, reflecting strength of the PGG Wrightson’s brand, expertise in the rural lending segment, and the company’s asset quality.”

Some good news for the PWF arm of PGW today. :)

[beacon]

They had it before too, "Reconfirmed" presented as "secured". PGC has BB+

[Balance]

Agree with everything except the good management part (excluding recent appointment obviously as time will tell). My nervousness is extended by HBY reporting on the same day. Both are on the comeback trail but both are showing price weekness (on lowish volumes) before the result. All in all - for the 26th will be either very pleasant or very dissappointing - but hey thats life being a fundy investor.

Market is nervous - even FBU got hit before a great result.

Likewise, OIC.

[flyingfox]

Market is nervous - even FBU got hit before a great result.

Likewise, OIC.


at least their financial position will looks much better,and could performance worse than last year?even last year that was becasuse of the one-off SFF failure

The problem is the whole market is lack of confidence now, many people are still waiting and watching,or prefer to put money in the bank

[Dr_Who]

Oh dear. Did the Chinese pay too much for PGW?

[percy]

Who knows? maybe DrWho knows!?,

[root]

Will find out tomorrow!

[Dr_Who]

Not a good sign when the sp is so weak just prior to the profit announcement.

[Balance]

Not a good sign when the sp is so weak just prior to the profit announcement.

It has been a funny reporting season. FBU and OIC were both weak before they reported. They both shot up after they reported better than expected results.

[root]

Nice to see a bottom line without any brackets around it.

[Doyle]

Yeah exactly, earnings were a little on the light side, but on the whole a solid result, and very much in line with expectations. They expensed the cap-raising costs which makes the bottom line look pretty small, but should really start to reap the rewards of a stronger balance sheet next year.

[Balance]

Yeah exactly, earnings were a little on the light side, but on the whole a solid result, and very much in line with expectations. They expensed the cap-raising costs which makes the bottom line look pretty small, but should really start to reap the rewards of a stronger balance sheet next year.

Some analysts were very negative that PGW will report a bad result. Brokers were getting clients to sell before the result.

Expect the real action to start after the analysts' briefing today.

[Dr_Who]

PGW multiples make ELD look too cheap. :D

[Bobcat.]

PGW multiples make ELD look too cheap. :D

I have been buying ELD over the past week on the expectation that PGW provide a healthy report today and they have. Taking into account the consolidation, I agree - @140c, ELD does look oversold. If it closes above 140 tonight, I would call it bullish. It's result is due any day now - yes? Last year, their result was out mid Feb.

...oops! this is the NZX thread, sorry.

[Balance]

I have been buying ELD over the past week on the expectation that PGW provide a healthy report today and they have. Taking into account the consolidation, I agree - @140c, ELD does look oversold. If it closes above 140 tonight, I would call it bullish. It's result is due any day now - yes? Last year, their result was out mid Feb.

...oops! this is the NZX thread, sorry.

Please enlighten us of your comparison.

What are the forward multiples the stocks are trading at? Are you using cashflow or earnings multiples?

[flyingfox]

I dont quite understand the equity-liability figures, where has the 200 million gone?

[Balance]

I dont quite understand the equity-liability figures, where has the 200 million gone?

???? It's all there.

[winner69]

I dont quite understand the equity-liability figures, where has the 200 million gone?

What don't you understand mate

What i can't understand is how can you sell so much (nearly $600m) and make so little ... when the worst year they ever had had was supossedly behind them

[Balance]

Please enlighten us of your comparison.

What are the forward multiples the stocks are trading at? Are you using cashflow or earnings multiples?

Bobcat has gone quiet.

Hope he has not been shooting from his hip?

[Bobcat.]

Balance,
Not so quiet. I have not done much fundamental analysis on this one. What I do know is:
a) a few farmers who are starting to spend more;
b) that the chinese company buying into PGW have made good investments before and are unlikely to buy a lemon (which this is not);
c) that their gearing (Debt to Debt+Equity) has improved;
d) that pre-reporting the bears ruled;
e) that it is now the bears who have gone quiet as the sp begins to rise (3.4% today and I estimate another 5% next week);
f) PGC shareholders seem to also like the report (their sp has also risen today indicating that the heavy selling may be over, even before they report)
g) technically, the sp has found good support at 58 and has bounced off nicely twice.

and there's more...but I got other work to do.
Happy trading.

[Balance]

Balance,
Not so quiet. I have not done much fundamental analysis on this one. What I do know is:
a) a few farmers who are starting to spend more;
b) that the chinese company buying into PGW have made good investments before and are unlikely to buy a lemon (which this is not);
c) that their gearing (Debt to Debt+Equity) has improved;
d) that pre-reporting the bears ruled;
e) that it is now the bears who have gone quiet as the sp begins to rise (3.4% today and I estimate another 5% next week);
f) PGC shareholders seem to also like the report (their sp has also risen today indicating that the heavy selling may be over, even before they report)
g) technically, the sp has found good support at 58 and has bounced off nicely twice.

and there's more...but I got other work to do.
Happy trading.

Thanks, Bobcat!

That is an excellent summation of your view - stock seems to be going the right way.

Let's wait for Dr Who to come back with his fundamentals comparison.

[Balance]

Still waiting for Dr Who to enlighten us with his 'multiples'.

Will be an interesting switch if ELD is indeed so much cheaper than PGW.

[Dr_Who]

PGW 2010 PER 23
ELD 2010 PER 10

I am sure a man like yourself with all the contacts can do your own numbers. Lets have a look at your numbers and your holdings disclosure.

Short term price movement does not represent long term fundamental value for a company. This is very true with the recent IPO of KMD and MYR where prices was pushed up for the first day of listing to make it look good.

[flyingfox]

Oh dear. Did the Chinese pay too much for PGW?

Chinese rarely pay too much for things they want to buy

[Balance]

PGW 2010 PER 23
ELD 2010 PER 10

I am sure a man like yourself with all the contacts can do your own numbers. Lets have a look at your numbers and your holdings disclosure.

Short term price movement does not represent long term fundamental value for a company. This is very true with the recent IPO of KMD and MYR where prices was pushed up for the first day of listing to make it look good.

No need to be defensive or insulting, Dr Who. It was a genuine inquiry to get some figures to look at. You made the assertion that ELD is very cheap compared to PGW.

Here's my take on the situation from publicly available information :

PGW is forecasting $24.1m so is currently trading on a forecast PER of 19 for 2010.

ELD is forecasting $54m so ELD trading on PER of 11.3 for 2010 but note that it is not taxed - so comparative PER is actually 16.2.

Note also that ELD's forecasts are dependent upon some asset sales. You might want to check on the progress of the asset sales - it's running $60m behind schedule. In fact, ELD has had to write down the value of Hi-Fert by 80%.

So knock $4m profit off ELD's forecasts - PER is now 17.5X.

The real upside to both stocks are going to be in 2011 when the benefits of the recapitalization and restructuring kick in.

I am happy to stick with PGW. Bobcat summed up the reasons why PGW looks good - solid balance sheet, solid industry position and restructuring behind the company.

Plus Agria could move at any time to increase its shareholding - Bobcat & I will consider our options at that time.

[macduffy]

Are there any views on the effect that the appointment of Sir John Anderson as chairman might have on PGW's fortunes?

In my experience of the man he is a very capable chairman and administrator, with a tendency to be somewhat autocratic and domineering. May be what PGW needs at this time?

Disc: Not holding at present.

[percy]

I think Sir John,s appointment as positive.Craigs have PGW as a buy. FY10 Fy 11 Fy 12
PE 18.5 10.30 9.24
EPS growth -68% 80.80% 10.9%
Craigs expect PGW to pay a divie in FY 11.
ELD and PGW both look to me to be well focused companies with strong brands ,who have fixed their balance sheets and I would expect both to perform well.

[COLIN]

Are there any views on the effect that the appointment of Sir John Anderson as chairman might have on PGW's fortunes?

In my experience of the man he is a very capable chairman and administrator, with a tendency to be somewhat autocratic and domineering. May be what PGW needs at this time?

Disc: Not holding at present.
He will have shrewdly assessed the situation before committing to take over. Inspires more confidence than Norgate, I must say.

[Balance]

He will have shrewdly assessed the situation before committing to take over. Inspires more confidence than Norgate, I must say.

Indeed. All the hard work on raising capital and restructuring is done - Sir John is taking over with perfect timing.

He can claim full credit when the share price goes back to $2.00 again.

[macduffy]

Indeed. All the hard work on raising capital and restructuring is done - Sir John is taking over with perfect timing.

He can claim full credit when the share price goes back to $2.00 again.

There still a lot of hard work, and good fortune needed to get the SP back to $2.00 from current levels.

If that happens, JA will be entitled to a big chunk of the credit, IMO.

[root]

Interesting article saying agricultural based companies and countries may be heading for good times.

http://www.nzherald.co.nz/markets/news/article.cfm?c_id=62&objectid=10628897&pnum=0

[flyingfox]

Anyone has some technical analyse?I only know this stock is undervalued now, but losing my patient waiting for the uptrend....maybe I should leave it and look back after a year.

[Dr_Who]

Anyone has some technical analyse?I only know this stock is undervalued now, but losing my patient waiting for the uptrend....maybe I should leave it and look back after a year.

How do you know it is undervalued? 2010 PE of 23x looks expensive to me.

[Balance]

How do you know it is undervalued? 2010 PE of 23x looks expensive to me.

Oh dear - still cannot calculate PER!

[Balance]

No need to be defensive or insulting, Dr Who. It was a genuine inquiry to get some figures to look at. You made the assertion that ELD is very cheap compared to PGW.

Here's my take on the situation from publicly available information :

PGW is forecasting $24.1m so is currently trading on a forecast PER of 19 for 2010.

ELD is forecasting $54m so ELD trading on PER of 11.3 for 2010 but note that it is not taxed - so comparative PER is actually 16.2.

Note also that ELD's forecasts are dependent upon some asset sales. You might want to check on the progress of the asset sales - it's running $60m behind schedule. In fact, ELD has had to write down the value of Hi-Fert by 80%.

So knock $4m profit off ELD's forecasts - PER is now 17.5X.

The real upside to both stocks are going to be in 2011 when the benefits of the recapitalization and restructuring kick in.

I am happy to stick with PGW. Bobcat summed up the reasons why PGW looks good - solid balance sheet, solid industry position and restructuring behind the company.

Plus Agria could move at any time to increase its shareholding - Bobcat & I will consider our options at that time.

For Dr Who's benefit.

Cheers!

[Phaedrus]

Losing my patient waiting for the uptrend....maybe I should leave it and look back after a year.You sound like an incompetent doctor! - Maybe you are one of those impatient fundamentalist types as well!
PGW appears to have stopped falling, but there is no evidence of any clear reversal as yet.
See how the OBV triggered an isolated Buy signal? Ignore it.
See how there was an isolated trendline break Buy signal? Ignore it.
See how the other 5 indicators featured here have not signalled a buy yet?
See how the Market Strength Indicator still has the plot highlighted in Red?
See how all of these indicators kept you out of PGW while the price halved?
See the little face in the lower right hand corner?

http://i602.photobucket.com/albums/tt102/PhaedrusPB/PGW35.gif

[Balance]

Not sure where you got 23 from - last rough calc I did was closer to 10. Looking forward, PGW operates on about an EPS of 7c so I'd suggest that PGW is undervalued - (but that calc is a bit confused by recent events )- but of course there are plenty of sellers who don't think the same way so why worry - just lap up the good prices and wait for sellers to wise up and dry up.

Can't see 10 myself. Maybe in 2011, but not 2010.

Meantime, please do us a favor and send Dr Who a calculator. I think he must be using the abacus and flicked the wrong buttons.

[flyingfox]

You sound like an incompetent doctor! - Maybe you are one of those impatient fundamentalist types as well!
PGW appears to have stopped falling, but there is no evidence of any clear reversal as yet.
See how the OBV triggered an isolated Buy signal? Ignore it.
See how there was an isolated trendline break Buy signal? Ignore it.
See how the other 5 indicators featured here have not signalled a buy yet?
See how the Market Strength Indicator still has the plot highlighted in Red?
See how all of these indicators kept you out of PGW while the price halved?
See the little face in the lower right hand corner?

http://i602.photobucket.com/albums/tt102/PhaedrusPB/PGW35.gif


I was just waiting for you mate, very helpful thanks, ok at least it stop falling before reached my cost, but i'm betting my interest cost, that's why I'm losing patient........
Anyway, Dr please give me a yell when you think the price is not expensive anymore- if that day will come eventually.

[Balance]

Sorry Balance, should have said I was looking forward and not backwards.

Just checked out a couple of broker sites and, yes, at least one has a PE of 23 ... Others appear to have given up even trying to calculate, e.g DB ;)

23x must be where Dr Who is working for or dealing with then.

That's good as Dr Who has been very good at reflecting current market sentiment. When he gets really negative, BUY!

[Dr_Who]

When he gets really negative, BUY!

You said exactly the same thing for MYR and KMD LOL :D

[Balance]

You said exactly the same thing for MYR and KMD LOL :D

Just check the postings and the facts, matey.

[percy]

Phaedrus.
thank you for your sage advice. I am waiting for the trend to change before adding to my holding.I think farmers are doing well but with the GFC they are paying down debt rather than spending.
So may be awhile before the uptrend,however I am holding myself at the ready!!!

[percy]

I am not a market mover. Just a very small investor who enjoys the market and tries to do better.Ph's charts suit me just fine.

[Steve]

I think farmers are doing well but with the GFC they are paying down debt rather than spending.

It's true that sheep & beef farmers did well last year, but I think that it was the banks making the farmers pay down the debt. When the banks relax their current lending policies to farmers, PGW will befefit from the increase in spending...

[percy]

It's true that sheep & beef farmers did well last year, but I think that it was the banks making the farmers pay down the debt. When the banks relax their current lending policies to farmers, PGW will befefit from the increase in spending...

Steve as I replied on CYT thread you have a 100% record.Right again.

[flyingfox]

I had enough with this stock ,,,dumping and switch to ASX

[Logen Ninefingers]

Geez, I just bought some PGW today. Your rides ending, mine is just starting. I'm pretty new to shares. My father always told me: "never have anything to do with shares". I'm wandered into this world of shares at an interesting time....country's moving out of recession; many companies are re-capitalised and ready to move forward after enduring some dark times, some long-term projects like PRC are getting down to the nitty-gritty after years of waiting, NZO have Kupe on the go & an exciting drilling program, the govt's investing up to $1.5 billion in the 'ultra-fast' broadband project....it's fascinating stuff.

[mouse]

:confused:
Geez, I just bought some PGW today. Your rides ending, mine is just starting. I'm pretty new to shares. My father always told me: "never have anything to do with shares". I'm wandered into this world of shares at an interesting time....country's moving out of recession; many companies are re-capitalised and ready to move forward after enduring some dark times, some long-term projects like PRC are getting down to the nitty-gritty after years of waiting, NZO have Kupe on the go & an exciting drilling program, the govt's investing up to $1.5 billion in the 'ultra-fast' broadband project....it's fascinating stuff.

Depends how much cash you have. ASX is obviously where the action is. But you can easily slide down as well as climb. The problem with investing in Oz if you live in NZ is how do you know what is happening in Oz. How do you get the gossip, how do you, as I did, look at the locomotives and conclude that rail in NZ was waiting to go broke? It did. How nimble are you with ASX? With lots of shares you can go to the Annual Meetings in Oz, but it takes me a bit of effort to get from Christchurch to Greymouth for Pike. Next problem is, do you need dividends or not? I do not, I have sufficient income. So I am able to hold Pike, Pyne Gould and PGGWrightson with no income at present.
I find the sharemarket quite fascinating. Far better than doing the washing up. :)

[Balance]

I had enough with this stock ,,,dumping and switch to ASX

Good sign.

We just need a few more posters reacting to the sp slump and we know the stock has bottomed.

Works a treat everytime!

http://www.sharetrader.co.nz/showthread.php?1163-FPA-Chart/page31

[root]

Balance, I'm pretty sure this is bottom (give or take 2cents), any thoughts as to why we are stuck there?

[Dr_Who]

High NZD?
Dairy prices peaked?
Lack of financing in the rural sector?
Too many rural companies seeking funding, including Fonterra?

You name it, plenty of reasons why PGW is stuck in this price range. But according to some people this stock is worth $100... LOL

[Balance]

High NZD?
Dairy prices peaked?
Lack of financing in the rural sector?
Too many rural companies seeking funding, including Fonterra?

You name it, plenty of reasons why PGW is stuck in this price range. But according to some people this stock is worth $100... LOL

Er, how long do we continue to watch the space at ELD?

http://www.sharetrader.co.nz/showthread.php?7182-ELD-Elders-....-must-be-money-to-be-made-here/page8

ELD is at an all time low again!

Wonder why?

[Balance]

Waiting for an answer from Dr Who.

LOL - Not holding my breath though!

[flyingfox]

Dr, nobody said this stock worth $100, I dump it not because it's not worth to hold,but just need time to see the buy signal, probably i will come back if lower bottom will be formed.

[Dr_Who]

Dr, nobody said this stock worth $100, I dump it not because it's not worth to hold,but just need time to see the buy signal, probably i will come back if lower bottom will be formed.

I was only having abit of funny winding up a certain individual. :D.. tongue and cheek.

[rabcat]

Why would the share price go up until they can show that they can turn a decent profit?
So no change until august/ september?

[Balance]

I was only having abit of funny winding up a certain individual. :D.. tongue and cheek.

LOL - indeed!

Every time Dr Who looks at ELD, he wonders why he bought into it instead of PGC or PGW.

[Dr_Who]

Looks like PGW For Sale sign is up.

Maybe the Chinese can pick this one up for cheap?


Why would the Chinese want to buy a NZ based rural servicing company employing thousands of people? Resources or brands - that's what the Chinese are looking for.

PGW is now in deep deep financial strife. Banks have given the company until 31 March 2010 to repay $200m.


Announcement... Chinese interest

Oh dear Balance :D

[flyingfox]

Agria had an announcement about strategy review on 10/03 and their sp just jumped 16%, they mentioned PGW cooperation but it seems have no effect in NZ
so disappointing on nz sharemarket, lack of interest....

[Balance]

Oh dear Balance :D

ELD now at an ALL TIME LOW. SP now not even covering rights issue price was $1.50 equivalent. Something smells.

In contrast, PGW sp is well above rights issue price of 45c.

LOL - You have not figured it out yet, Dr Who, have you? Circumstances change in the market and you change your investment strategy to maximize the opportunity.

Unlike you, I am happy to admit I am wrong and decide what to do next.

Cool big ripe sweet juicy red water-melons on a hot sunny day. Crackling roast pork on a snowy cold day. Get it?

[mouse]

Have I missed something? What is affecting the price of PGGWrightson? I am OK at anything above 48 cents, only a small loss at that price. Any idea when improvements. Also what is this about $200million. I thought the Rights coveredd that. Or is it another $200 million? All advice welcome.

[Balance]

Have I missed something? What is affecting the price of PGGWrightson? I am OK at anything above 48 cents, only a small loss at that price. Any idea when improvements. Also what is this about $200million. I thought the Rights coveredd that. Or is it another $200 million? All advice welcome.

Not another $200m, Mouse. In fact, PGW has paid back the banks earlier due to stronger cash position.

Sp of companies after hefty rights issues tend to be volatile. We have seen it with NPX, FPA, PGC and the same with PGW. Traders will trade in and out and there's still decent profits in PGW for those who were brave and bought the stock at lowish levels. Remember the rights price was 45c.

Dr Who thought ELD is very cheap but forgot to do a post-taxed PE adjustment - which is how comparisons are made. The fallacy of youth - they think they know everything. Sigh.

[mouse]

Not another $200m, Mouse. In fact, PGW has paid back the banks earlier due to stronger cash position.

Sp of companies after hefty rights issues tend to be volatile. We have seen it with NPX, FPA, PGC and the same with PGW. Traders will trade in and out and there's still decent profits in PGW for those who were brave and bought the stock at lowish levels. Remember the rights price was 45c.

Dr Who thought ELD is very cheap but forgot to do a post-taxed PE adjustment - which is how comparisons are made. The fallacy of youth - they think they know everything. Sigh.

Many thanks. I thought the 200 million was repaid. Error in my post, I am OK above 58cents. Only a small loss at that level. :)

[Dr_Who]

:t_up:Mouse have a look at ELD, it is up over 8.7% today.

[The BOWMAN]

:t_up:Mouse have a look at ELD, it is up over 8.7% today.

Do we know why? Or any guess?

[mouse]

Do we know why? Or any guess?

No idea. Your explanation, plus of course Balance, most welcome.

[Dr_Who]

Do we know why? Or any guess?

Read the ELD thread. I ve been saying all along that ELD looks cheaper than PGW on my numbers. ELD sp up again today. But then, hey dont listen to me, I am just a hillbilly who cant read the spreadsheet. :D

You gotto watch some people in here, when they are too negative you gotto buy... echo echo echo... LOL

[Balance]

Read the ELD thread. I ve been saying all along that ELD looks cheaper than PGW on my numbers. ELD sp up again today. But then, hey dont listen to me, I am just a hillbilly who cant read the spreadsheet. :D

LOL - and your spreadsheet tells you that the sp is above the rights issue price?

Once a hillbilly, always a hillbilly.

[flyingfox]

Geeeez the volume...who is this?funds back?after push the impatient small players lik me to sell to them?!
ok ,,,,they alwyas win

[beacon]

Geeeez the volume...who is this?funds back?after push the impatient small players lik me to sell to them?!
ok ,,,,they alwyas win

10 mil and counting

[rabcat]

Does any one have any idea who is buying and selling 10 million shares?

[rabcat]

The same 10 mill parcel traded at ~65 in mid Oct 2009?

That was the Silver Ferns Farms shares which were brought by AMP from memory. But since then there has been a 9 for 8 share issue and a lot of movement in the ownership of PGW.

Was wondering if perhaps Dr Who had had a change of heart re PGW and decided to buy a few?







mory?

[mouse]

It appears that PGW is exposed to around 8 million for the Crafar farm situation. Not too bad.

[Snoopy]

Craig Norgate gives his children interesting presents :)

Perhaps Craig has figured out that in 20 years or so, when his children are grown up, the share price will have recovered to match the price he himself paid for his RPI stake in PGW?

SNOOPY

[bung5]

it is taking a bit longer than I thought for the shareprice to get some gains. looking like will have to wait until septempber

[Dr_Who]

That was the Silver Ferns Farms shares which were brought by AMP from memory. But since then there has been a 9 for 8 share issue and a lot of movement in the ownership of PGW.

Was wondering if perhaps Dr Who had had a change of heart re PGW and decided to buy a few?


PGW is going through some pain the Aussie farmers went through last year and early this year. DROUGHT! Also NZS is a problem child for PGW. NZS has to sell down their farms just to pay their fees. How long can this go on, no one knows. NZ rural sector is also struggling with the lack of cash. Farmers cant even sell their farms.

There will come a time I will buy PGW. The timing is yet a guess at this stage.

[root]

Fair summary Doc, I don't know much about farming but at some stage you'd expect farmers to have to re-sow a lot of their drought ravaged pastures and bring the livestock levels back. I suppose that involves borrowing from the banks, and buying off PGW and RD1.

[Nevl]

ok whats up???

Maybe a reaction to the fact that international dairy supplies are tight at the moment and a big jump in dairy prices is on the cards at the next Fonterra auction. They have already taken 5000 tons off the table.

[percy]

Dr Who,Is that you buying today?

[upside_umop]

I'd say Norgate. Who else needs to sell? And has that many shares to offload? But the question is...who's buying? Agria need shareholder approval to take their stake above 20% or else they launch into the takeovers code.

Does anyone know whether Agria can buy Norgates share and apply for shareholder approval afterwards? I thought the order would be the other way...but this would kind of explain it.

[Dr_Who]

I'd say Norgate.

Give this gentleman a choc fish for the right answer.

[percy]

I'd say Norgate. Who else needs to sell? And has that many shares to offload? But the question is...who's buying? Agria need shareholder approval to take their stake above 20% or else they launch into the takeovers code.

Does anyone know whether Agria can buy Norgates share and apply for shareholder approval afterwards? I thought the order would be the other way...but this would kind of explain it.

I am sure they cannot do that.Would need to make full takeover.Interesting ,look forward to seeing who the buyer is.

[Silverlight]

Trade volume is 48,457,450.

According to this notice from 23 December http://www.nzx.com/markets/NZSX/PGW/announcements/3189475/SSH-Disclosure-RPI, Rural Portfolio Investments Securities Limited own 48,457,450.

Coincidence?

[Snoopy]

ok whats up???


16 trades as 6% of the company is sold down. Can only be PGC or RPI, as I doubt the Chinese have suddenly turned tail. Norgate needs money to pay interest to RPI bondholders. No hope of a PGW dividend that used to fund these payments. Having used his kids to pump the shareprice, Norgate now selling down to whoever will take those RPI shares? Norgate is gone from the board and is now on his way out of the share register. Are we witnessing the unravelling of a dream of an increasingly desperate man?

SNOOPY

[percy]

SNOOPY/
yes I think you have it right yet again.PGC are not distreesed sellers, so I would not expect them to be sellers.I wonder if the Singaporeans are buying.

[bung5]

RPI norgate

[Anna Naum]

Details of the transactions or other events requiring disclosure under the instructions to this form:
Rural Portfolio Investments Securities Limited has unconditionally agreed to sell its 48,457,450 PGG Wrightson Limited (PGW) shares in an off-market transaction, with consideration of $0.56cps ($27,136,172.00).
As a result of this agreement, the relevant interest of Rural Portfolio Investments Securities Limited in its shares has changed from a legal and beneficial to a legal interest only.
Settlement is to take place on 26 April 2010.

[geezy]

who bought from norgate? AMP capital investments?

[root]

AMP reduced their holding in FPA and bought PGW.

[Anna Naum]

AMP reduced their holding in FPA and bought PGW.

The ss from AMP on PGW suggested purchases over the last few months rather than yesterday.

[Dr_Who]

Looks like PGW have caught the ELD flu.

[rabcat]

Looks like PGW have caught the ELD flu.

Seems that RPI cant pay there shareholders/bond holders the divdend/ interest payments due so bond holders will inherit the shares and sell them on the market. So share price is sinking again!

We might be seeing the final demise of RPI?

Oh well it must be time for a top up!

[Dr_Who]

It seems like everyone wants out of PGW. I assume PGC will want to sell down their 18% at some stage as it is non core?

[Balance]

Distressed shareholders = cheap stocks.

Remember when Fletchers sold out of Fletcher Paper? Or Fisher Fund sold PPL?

ELD? Dog with fleas which has an insolvent unit in NZ and more write-downs in Oz. Market is selling down to avoid the fleas jumping onto them!

[mouse]

Distressed shareholders = cheap stocks.

Remember when Fletchers sold out of Fletcher Paper? Or Fisher Fund sold PPL?

ELD? Dog with fleas which has an insolvent unit in NZ and more write-downs in Oz. Market is selling down to avoid the fleas jumping onto them!

I hold a few PGGWrightson. Patriotic Duty and so on. :)In this case, we must stop the Chinese getting the Company. :cool:The question is, what is the price at which I should CONSIDER buying more, and what is the price at which I must buy more.:ohmy:
All ideas welcome. Craig is obviously out, or will be shortly. :) :)

[percy]

I do not Know at what price you must buy more.What we know is PGW has a strong balance sheet,the finance company is in good shape,the seeds business is world class.the PGW brand is strong,the board has been strengthened,the management is good.So the company is well respected,well managed and the results will come.
What is against the company is 4% of the company is about to come onto the market.This affects the SP short term but has no bearing on how the company performs long term.Once this overhang has found a home ,then all of a sudden the overhang has gone.
PGC's 18% is where you may need to ask more questions.Most PGC shareholders are relaxed with PGW .Whether PGC will put PGW holding into a rural fund under Perpectual trust,sell or continue to hold time will tell.PGC did not take up their rights in recent PGW issue without making sure it would be profitable.
Looks a great buy to me at these prices.Be certain while others are uncertain.Or buy just a few then add a few more in a month or twos time.
A bit like Ballanttynes sale.You go into buy a shirt and find you brought 2 for the price of 1.!!!!!!!!

[Balance]

I do not Know at what price you must buy more.What we know is PGW has a strong balance sheet,the finance company is in good shape,the seeds business is world class.the PGW brand is strong,the board has been strengthened,the management is good.So the company is well respected,well managed and the results will come.
What is against the company is 4% of the company is about to come onto the market.This affects the SP short term but has no bearing on how the company performs long term.Once this overhang has found a home ,then all of a sudden the overhang has gone.
PGC's 18% is where you may need to ask more questions.Most PGC shareholders are relaxed with PGW .Whether PGC will put PGW holding into a rural fund under Perpectual trust,sell or continue to hold time will tell.PGC did not take up their rights in recent PGW issue without making sure it would be profitable.
Looks a great buy to me at these prices.Be certain while others are uncertain.Or buy just a few then add a few more in a month or twos time.
A bit like Ballanttynes sale.You go into buy a shirt and find you brought 2 for the price of 1.!!!!!!!!

What really matters is the sp a year from now (unless you are a trader). Those who bought into RBD or Nuplex in the last year bought at varying prices, some higher than others - did not really matter as their share prices have kept going higher and higher.

Having said that, we all want to get in at the best price possible.

Impossible to pick the bottom or the top so it's case of buying when the trend reverses decisively. Most of us would agree that averaging down is not a great way of investing!

Here there is a distressed seller so let's hope the trustee does not flog the whole lot to one buyer cheap.

BRING IT ON!

[percy]

What really matters is the sp a year from now (unless you are a trader). Those who bought into RBD or Nuplex in the last year bought at varying prices, some higher than others - did not really matter as their share prices have kept going higher and higher.

Having said that, we all want to get in at the best price possible.

Impossible to pick the bottom or the top so it's case of buying when the trend reverses decisively. Most of us would agree that averaging down is not a great way of investing!

Here there is a distressed seller so let's hope the trustee does not flog the whole lot to one buyer cheap.

BRING IT ON!

Balance,do not tell anyone but I agree with you 100%unless the buyer is Mouse!!!!

[mouse]

Balance,do not tell anyone but I agree with you 100%unless the buyer is Mouse!!!!
Note though, we only have one 'maybe' distressed seller. Since Pyne Gould can afford to hold plus scout around for someone to get their parcel at a bit of a premium. The Trustees for RPI? may sell quickly, but I doubt it. Craig Norgate may soon no longer be in charge of that parcel of shares. Same applies to NZ Farming Uruguay.
So when do we know its a panic sale?? Ideas please. When is the bottom the bottom?

[percy]

. When is the bottom the bottom?[/QUOTE]

Mouse.the absolute bottom is reached when sharebrokers sell their wife's holding in a company.
When the market thinks there is more bad news to come,but there is not.
Balance has said the you should not try to worry about the bottom but wait until the uptrend.This is the best advice.
I have said if you cannot help yourself spread your purchases over a few months .
Balance has also pointed out the SP in a year's time is what you should be thinking about.
I cannot help getting excited on what the divie will be in a year or twos time.What will be the yield on today's SP.?

[GR8DAY]

......yes what is the current yield at 53c....anyone know or prepared to forecast that over the next 12mnths.??

[Snoopy]

At 64c PGW is now trading on a projected PE for FY2010 of 64/3.1= 20.6. Hardly cheap although the capital restructuring will shave that interest bill in future years. And if you believe the old Craig Norgate vision of $40m (which translates to $55m, or 7.2cps under the new capital structure) then PGW is trading on a FY2011 PE of 64/7.2 = 8.9.


Just repeating part of a post I made on 13th January, for those with memories towards the shorter end of the spectrum. At 53c, PGW is trading on a 'good season' PE of around 7. The dividend has currently been suspended while earnings go to pay down debt. So the projected dividend yield is currently nil. If you swallow the Norgate hype then the the best case scenario would be an annual dividend of 7cps.

It is quite difficult to value a share like this based on cyclical earnings. The question is, is the Craig Norgate vision still attainable? I would say it is. But whether that vision comes to fruition in FY2011 is another matter.

SNOOPY

[GR8DAY]

....so tell me SNOOPY, what exactly is/was the Norgate Vision??

[percy]

[

It is quite difficult to value a share like this based on cyclical earnings. The question is, is the Craig Norgate vision still attainable? I would say it is. But whether that vision comes to fruition in FY2011 is another matter.

SNOOPY[/QUOTE]

As allways snoopy you do the hard work.Craigs have FY 11 net profit at $44.4 mil rising to $49.20 FY 12.So they are a bit behind Norgate's $55mil,but as you correctly point out cyclical earnings make a correct valuation hard.Who knows Norgate may be right!! What is important is the company has been put right.

[root]

If you are holding PGW at the moment it is because you are expecting the SP to move North rather than projected Yield. Good value at 53.

[Snow Leopard]

I've picked up my first ever PGW parcel today @ .53
I do not know whether to congratulate you or commiserate with you.
I hope it works out

regards
Paper Tiger

[Snoopy]

....so tell me SNOOPY, what exactly is/was the Norgate Vision??

No major climatic effects during the farm year. Reduced costs because of rationalisation of the previous separate Pyne Gould Guiness and Wrightson store networks. Interest rates not significantly changed.

SNOOPY

P.S. No contribution from the failed Silver Fern Farms tie up has been allowed for.

[Snoopy]

If you are holding PGW at the moment it is because you are expecting the SP to move North rather than projected Yield. Good value at 53.


I would argue it is the same thing. The share price will move north when dividend prospects improve.

SNOOPY

[root]

I would argue it is the same thing. The share price will move north when dividend prospects improve.

SNOOPY

The market seems to factor in good news before it's announced.

[GR8DAY]

no major climatic effects during the farm year. Reduced costs because of rationalisation of the previous separate pyne gould guiness and wrightson store networks. Interest rates not significantly changed.

Snoopy

p.s. No contribution from the failed silver fern farms tie up has been allowed for.

sounds more like a dream than vision snoops!! No climatic effects ha!......i think he needs to go get a real job and try farming.......might looses a bit of that gut in the process!

[flyingfox]

sounds more like a dream than vision snoops!! No climatic effects ha!......i think he needs to go get a real job and try farming.......might looses a bit of that gut in the process!

Yeah everyone knows about the drought hit milk production,but price is a very positive sign of another dairy boom, chinese start to look at new investment- cos they know how big the market is and how precious a piece of clean land like NZ is.
Hope NZers could value their asset fairly as well

[Snoopy]

sounds more like a dream than vision snoops!! No climatic effects ha!.....


I think with farming you have to strive to do your best, but plan for the worst. With all weather factors going your way and competition in the market as it was a couple of years ago I don't think $55m is pie in the sky. Of course we get droughts, floods, unpredictable exchange rates, and the more one off effect of the credit crunch that dropped like a bomb and I think will echo out for years to come. When setting your goals, I don't think you can assume you will be king hit from many sides at once. I accept a $55m profit goal looks aspirational now. But that doesn't mean it wasn't the right figure to set as a profit goal at the time.

SNOOPY

[Snoopy]

Yeah everyone knows about the drought hit milk production,but price is a very positive sign of another dairy boom, chinese start to look at new investment- cos they know how big the market is and how precious a piece of clean land like NZ is.
Hope NZers could value their asset fairly as well

Only around 30% of PGGW customers are dairy farmers. Perhaps less now with the Crafers 'off the books'

SNOOPY

[Snoopy]

i think he needs to go get a real job and try farming.......might looses a bit of that gut in the process!


A bit unfair to put the boot into Norgate now I think. I heard Brian Gaynor's criticisim of PGW having a weak board that just let Norgate run amuck doing too many things at once. No quite right I would have said.

NZS was up and running according to plan when Norgate tried the meat industry rationalisation, via Silver Fern farms. The expanded PGGW Finance has dodged many of the troubles of other finance industry companies. The bedding of Wrightsons and Pyne Gould Guiness together, I think we have to class as a success. It was only the credit crunch that derailed the Silver Fern farms deal. If a butterfly had flitted its wings a little differently in South Africa, the whole story could have had a different ending.

SNOOPY

[root]

It may be overly simplistic but buying or topping up on Agri Stocks at the end of a drought seems like a good plan to me. Someone has to put food on the global plate.

[Snoopy]

NZS was up and running according to plan


One caveat here. If Norgate had stuck to the original NZS prospectus plan, and developed only about half the land bank NZS have now, then NZS shareholders would be much better off today. The burden of those Uruguayan bonds on shareholder returns would be far less crippling. Of course the expansion was done in the light of soaring milk prices, and the expectation that Uruguayan land prices would only go up. Norgate just got 'white gold fever', which is perhaps something that a board with long farming experience, could have foreseen.

SNOOPY

[duncan macgregor]

Farming is a very simple industry to understand. The industry runs from one gold rush to the next with the winners getting out of todays booming sector and getting into the next before it happens. Never buy into todays great boom in farming but look for the next. First we had Kiwi fruit people made fortunes from the follow on mugs. Then remember it was goats for #crist sake followed by bloody Ostriches. I remember one mug wanted to pay me $1000 bucks for my old roadside nanny. I had more respect for nanny than sell her to him.
This was followed by the dairy boom where every man and his dog was spending huge bickies buying forests and other hopeless land turning them into dairy farms with a five pc return on capital. We now have the sitruation where they think they know best brigade buying land to turn into NZ type dairy farms in other countries because the people over there havent caught on as yet.
Macdunk

[mr.needs]

Farming is a very simple industry to understand. The industry runs from one gold rush to the next with the winners getting out of todays booming sector and getting into the next before it happens.
Macdunk

So what's the next gold rush in farming that we all need to get into today, before it happens?

[Balance]

Farming is a very simple industry to understand. The industry runs from one gold rush to the next with the winners getting out of todays booming sector and getting into the next before it happens. Never buy into todays great boom in farming but look for the next. First we had Kiwi fruit people made fortunes from the follow on mugs. Then remember it was goats for #crist sake followed by bloody Ostriches. I remember one mug wanted to pay me $1000 bucks for my old roadside nanny. I had more respect for nanny than sell her to him.
This was followed by the dairy boom where every man and his dog was spending huge bickies buying forests and other hopeless land turning them into dairy farms with a five pc return on capital. We now have the sitruation where they think they know best brigade buying land to turn into NZ type dairy farms in other countries because the people over there havent caught on as yet.
Macdunk

u r talking like a trader. Lambton Quay farmers are the ones chasing short term gains. There are many farming families who have been in farming (dairy, kiwifruit, sheep, crop etc) since forever.

[duncan macgregor]

u r talking like a trader. Lambton Quay farmers are the ones chasing short term gains. There are many farming families who have been in farming (dairy, kiwifruit, sheep, crop etc) since forever. Its a fact thats what has happened like it or not. Whats next? by the time we know its to late. I would hazard a guess and say its some thing right out of favour at the moment. Macdunk

[neopoleII]

free range chickens and pigs
momentum is building up for a law change
watch the 10acre blocks boom.
trouble is most of the horsey folks already own those blocks.

[Snoopy]

So what's the next gold rush in farming that we all need to get into today, before it happens?

My guess: dairy- again! The first 'farming fad' to make a comeback. Why? Because Fonterra is a globally sized marketing company that is behind the farmers. Unlike apples and lamb where alternative NZ suppliers bid down each other's returns, the dairy farmers are well organised and largely united. They have learned their market lesson not to raise cheese prices too fast and kill off overseas demand.

It is the same with kiwifruit who have now recovered by uniting under the Zespri brand and developing the innovative 'gold kiwifruit' and kiwiberries. Get the marketing to the supply chain sorted and returns to farmers will flow.

SNOOPY

[percy]

Does it really matter what the next gold rush is in farming as PGW the merchant will make money selling the picks etc to the miner farmers whatever they farm.

[root]

Long term PGG Wrightson should be looking to the global seed market. If their R&D is in place now and they have the right research partners in the right markets, they could position themselves to be a world leader.

[beacon]

Long term PGG Wrightson should be looking to the global seed market. If their R&D is in place now and they have the right research partners in the right markets, they could position themselves to be a world leader.

All in good time...

Agree with percy about PGW as core supplier, and snoopy re Norgate and South American butterflies. Now seems to be the best time to top-up on PGW for the very long term, won't have this opportunity again after europe rights itself next week ...

I hear pigs and eggs getting more popular too, neopole...

[GTM 3442]

free range chickens and pigs
momentum is building up for a law change
watch the 10acre blocks boom.
trouble is most of the horsey folks already own those blocks.

Don't think so.

The 10 acre block can only sell to those who can afford to patronise the local "Farmers Market". They can't sell to the chains - nowhere near enough volume. And how on earth would one get a slice of the action ?

Of course, if the 10-acre-block-owners all got together, they could form a "strategic alliance" - maybe even a co-operative !

Then we could go through New Zealand farming history all over again !

Yippee ! Deja vu ?

[neopoleII]

NZs biggest free range egg producer is bending over backwards to find people to produce free range eggs for them.
whats needed is 10 acres of flat land and no close neighbours or very accomodating neighbours.
same will go for pigs once a co- op of sorts is organised......... and its starting to happen.

[neopoleII]

heres the link
http://www.frenzs.co.nz/

[Enumerate]

What is the word on the RPC "overhang"? After all, these will either be sold or distributed to those who may choose to sell.

[Contrarian]

Gidday Enumerate
46,764,868/758,440,543 = about a sixteenth or 6%

I emailed the trustee asking for my allocation to then file in the bottom drawer, rather than a block sale.
If they don't do as I asked, I hope that 6% is a nice parcel for someone to add to, or start a stake with & maybe a fairish price may be extracted.
I suppose the trustee can't play god with peoples money & timeliness will be the key. Who can guess tommorows market??

[beacon]

Gidday Enumerate
46,764,868/758,440,543 = about a sixteenth or 6%

I emailed the trustee asking for my allocation to then file in the bottom drawer

Brilliant idea. There's an SSH notice today re progress on that 6.17%

Despite the current european unrest affecting global markets as well as the consistent pressure RPI and related holdings overhang has had on the PGW share price, it has held up well. That's as bullish a sign as I've seen. Watching and accumulating ...

[biker]

It would seem to me this latest fiasco is simply reinforcing how basically incompetent the Wrightson Chairman and Board have been over the last few years. Keith Smith, Craig Norgate, McConnon etc. Perfect financial storm? Bullsh it. Rather an inability to do the job. Gross incompetence. SFF a prime example. And they know it, and admitted it at the AGM. I thought Norgate was a bit of a whiz kid. Plenty of arrogance and financial agression but an obvious and dissapointing lack of ability. The Fonterra Board must have wry smiles, having booted him out of the CEO position.
And how on earth did the McConnon family get sucked in to loosing $60million dollars?
Company Directors in good old NZ, they're a wonderful thing.

[Snoopy]

And how on earth did the McConnon family get sucked in to loosing $60million dollars?


$60m is the sum owed to bondholders. To my knowledge the McConnon's didn't own any bonds. The McConnon's have lost their equity in RPI. However, this equity was smoke and mirrors anyway. If you follow the accounting cross company paper trail it never existed. Thus the McConnon's have lost nothing in this collapse as I see it.

SNOOPY

[biker]

$60m is the sum owed to bondholders. To my knowledge the McConnon's didn't own any bonds. The McConnon's have lost their equity in RPI. However, this equity was smoke and mirrors anyway. If you follow the accounting cross company paper trail it never existed. Thus the McConnon's have lost nothing in this collapse as I see it.

SNOOPY
It was the equity in RPI I was refering to. However the words used at one of the AGM's by McConnon was " we've lost a shi t load "
( it is the agrarian sector after all! )

[biker]

Snoopy, I would be interested in supporting info showing the McConnons haven't lost anything.


Brian Gaynor and Owen Hembry in the Herald seem to have it pretty right. Both good articles IMHO

.............................However Norgate has been quoted as saying he hasn't lost anything so he may have had an undisclosed put option to the McConnon family whereby they have been forced to take the $60 million of shareholder losses associated Rural Portfolio Investments with public investors taking an additional $30 million hit.

Nearly $1.0 billion of investor wealth in PGG Wrightson, NZ Farming Systems Uruguay and Rural Portfolio Investments has been destroyed since mid-2008.

These huge losses should not have occurred because Norgate and the McConnon family are experienced business people with good track records. However they repeated the same mistakes as many other New Zealand entrepreneurs, namely they expanded far too rapidly with too much debt and not enough equity.

In addition they had weak boards of directors, they expanded NZ Farming Systems Uruguay far more rapidly than indicated in the prospectus, there were too many related party transactions and the Rural Portfolio redeemable preference shares should never have been sold to the public.

Wealth creation shouldn't be too difficult, particularly in a long-established rural-based company, but our business leaders continue to shoot themselves - and outside investors - in the foot through complex corporate structures, having too much debt and a reluctance to appoint strong independent directors.

* Disclosure of interests; Brian Gaynor is an executive director of Milford Asset Management.



And this from an article by Owen Hembry in the Herald


.........It is estimated nearly $1 billion of investor wealth has been wiped out in the past two years in rural companies associated with Norgate, with one key business partner losing more than $60 million


.......................The McConnons provided the initial $40 million investment in the Rural Portfolio group, followed by more capital to a total of $60.2 million - an investment now lost.

[Snoopy]

Snoopy, I would be interested in supporting info showing the McConnons haven't lost anything.
.......................The McConnons provided the initial $40 million investment in the Rural Portfolio group, followed by more capital to a total of $60.2 million - an investment now lost.

Look at the RPI prospectus issued in 2004. The structure of the group is on pg16 and the cashflow statement (before and after bond issue) on page 19. That $40m figure put in by the McConnon's is right. However that 'capital' was shown on page 69 of the RPI prospectus to be preference shares, a form of debt. I believe this was pulled out of the company when the RPI bonds were issued as replacement debt, leaving control of RPI with the McConnons and Norgate, but all the risk with the bondholders.

SNOOPY

[Snoopy]

I believe this was pulled out of the company when the RPI bonds were issued as replacement debt, leaving control of RPI with the McConnons and Norgate, but all the risk with the bondholders.


More specifically look at p19 column 3 the cashflow of Rural Portfolio Investment securities 12 months +18 days to 18 April 2005 (projected). That shows $85m of Redeemable Preference shares to be issued (to the public) and at the same time an $85m loan made to RPI being repaid. That to me is documentary evidence of of the McConnon's, Norgate and the banks cashing out and being replaced by the public bondholders as sole financers of the RPI holding company.

SNOOPY

[Snoopy]

It was the equity in RPI I was refering to. However the words used at one of the AGM's by McConnon was " we've lost a shi t load "
( it is the agrarian sector after all! )

There has been no public AGM of RPI, because this company is solely owned by the McConnons and Norgate with no public shareholders.

The expression " we've lost a shi t load " I assume was referring to share price declines of either or both of PGW and NZS and must have been made at a PGW or NZS shareholders meeting. In that sense I think the " we've lost a shi t load " is using 'we' in the 'royal we' sense. McConnon's baby RPI may have then been stareing at large on paper losses (which the receivers will realise). But when the baby 'died', it was simply handed onto the receivers. Any Norgate/ McConnon grief is for loss of control, not loss of cash.

SNOOPY

[Snoopy]

Any Norgate/ McConnon grief is for loss of control, not loss of cash.


My version of events would explain why Norgate is on record saying he has lost no cash. The alternative explanation, that Norgate had a secret put option to shovel debt onto the McConnons doesn't sound likely to me. Why would the McConnon's, experienced business people, have agreed to such a put option in the first place? What would be in it for them?

SNOOPY

[biker]

Thanks Snoopy.
Why dont you send your info to Gaynor etc and the Herald or better still, Stuff. It would make an interesting story.
The 'shi t load' comment was at the PGW AGM and that post was meant to be a light-weight reflection of the character of the man, with a comment like that at an AGM.
Irrespective of the amount lost, there can be no price put on the loss of reputation and 'face' by the McConnon family and Craig Norgate.
They are now simply additions to a sadly rapidly growing list.

Company Directors in good old NZ, they're a wonderful thing.

[Snoopy]

Thanks Snoopy.
Why dont you send your info to Gaynor etc and the Herald or better still, Stuff. It would make an interesting story.


My info is all in the public domain Biker. I looked into it carefully at the time, weighing up whether to buy RPI bonds or PGW shares directly. I chose the latter. I haven't kept up to date with RPI since then. And the prospectus information was what was proposed to happen. I am not 100% sure that this is how the RPI finances actually ended up, since I haven't seen an updated balance sheet after the event. I would be interested to know from bondholders whether financial information about RPI was provided to them after the event, or whether they just got cheques in the mail and that was that. With the demise of RPI I will now add the RPI prospectus to my 'library of shame', an infamous cardboard box in the corner of my study. SNOOPY

[mouse]

Many thanks Snoopy for your explanation of what has happened. My faith in Human Nature is now restored.

[beacon]

This is a sad reflection. Thanks Snoopy.
Quitting this stock, as there seem to be just too many skeletons in the cupboard for our liking, despite better outlook (is that a mirage as well?) ...

[mouse]

This is a sad reflection. Thanks Snoopy.
Quitting this stock, as there seem to be just too many skeletons in the cupboard for our liking, despite better outlook (is that a mirage as well?) ...
Craig Norgate is no longer a major presence in PGG Wrightson. The past history has little bearing on the present, except a warning about putting cash into ventures like RPI etc. Holding shares may even be the most sensible, risk free, investment that you can make. PGG is now at a low price. Will quite possibly go lower. :confused:
When and if dividends return the price should move up. Has anyone any ideas when that might be?:)

[Balance]

Posters like to talk negative when stocks are down - it's the future, not the past.

Think RBD and how negative posters got.

[percy]

Craig Norgate is no longer a major presence in PGG Wrightson. The past history has little bearing on the present, except a warning about putting cash into ventures like RPI etc. Holding shares may even be the most sensible, risk free, investment that you can make. PGG is now at a low price. Will quite possibly go lower. :confused:
When and if dividends return the price should move up. Has anyone any ideas when that might be?:)

Result for the year ending 30th June 2010 should be announced in August,if no mention of divie I would expect them to say something about it when you ask at AGM in October.I think the share overhang is built into the price.My concern is whether farmers have found their cheque books.Nothing you can do when farmers do not spend.As for skeletons in the cupboard I would think they are well gone.It is a bit like quoting unemployment figures.People go on about 6% unemployment but never mention 94% fullemployment.As has been mentioned before PGW is NZ's premier rural supply company,well financed,well managed,now well directed.Strongest Brand in rural supply.

[mouse]

Posters like to talk negative when stocks are down - it's the future, not the past.

Think RBD and how negative posters got.
PGG Wrightson has a money tree planted with NZ Farming Uruguay. It is paying for their South American expansion. They have a national presence in New Zealand. They have many different operations, including their Finance arm. The price may go down to 45 cents. If it does I shall buy more. We should try to keep a few companies in Kiwi hands. Even if we get a little lower dividend. At the least we can stroll round to their local office to see if it is still being painted and if the carpet has grown threadbare. Every bit of information helps! Take Courage!

[biker]

This is a sad reflection. Thanks Snoopy.
Quitting this stock, as there seem to be just too many skeletons in the cupboard for our liking, despite better outlook (is that a mirage as well?) ...

I think the bad news on PGW is abating, Norgate is gone, the economy is looking a little brighter, RPI's shares will find a home, and PGW's share price may well turn the corner. The damage has already been been done. Why sell out now? It would seem to me more like a time to buy.

[flyingfox]

i agree the worst time is over Biker, but guess who will take RPI shares?i think it's such a bargain but i don't have that much money, agria?acc?amp?all the big buddies have no action recently,excepct Norgate who need cash immediatley
what r they waiting for?

[biker]

I think you will find that in the next couple of days RPI's PGW shares are all sorted. Gaynor this am refered to the reciever flogging them to the 'institutions' so I suspect it is all done and dusted. Must say I hope to see a few myself.

[nwood]

RPI Sorted?

93493736 Shares sold for $48,616,743 (52CPS)

[root]

Definitely a lot of buy pressure this morning. If you topped up at 52/53 you're laughing now.

[nwood]

Definitely a lot of buy pressure this morning. If you topped up at 52/53 you're laughing now.

Indeed, a lot of new buy orders entered in the last 10min

[Balance]

Posters like to talk negative when stocks are down - it's the future, not the past.

Think RBD and how negative posters got.

It's RBD all over again.

[flyingfox]

I think whoever pick it now will be laughing as well in future

[rabcat]

Was just wondering what is the 97 million shares that have traded today? TIs this RPI or something different?

[percy]

RPI holding dristibuted holders.

[flyingfox]

RPI holding dristibuted holders.

Saw it on stuff, receivers sold pgw shares

[winner69]

Institutions snap up Rural Portfolio's PGG Wrightson shares

http://www.nbr.co.nz/article/institutions-snap-rural-portfolios-pgg-wrightson-shares-122827

[Logen Ninefingers]

There's a link to a story on the NZX website which reads as follows:

•Rural Portfolio receivers sell PGG shares

Muppets.

[root]

Overhang gone and it's raining, things are looking up.

[moimoi]

The NZ Herald states that the receivers sold 46.8M shares at 0.52 on Monday...doesn't account for the 106M in turnover yesterday.(or has there been a quick flick)

[Balance]

The NZ Herald states that the receivers sold 46.8M shares at 0.52 on Monday...doesn't account for the 106M in turnover yesterday.(or has there been a quick flick)

Craigs bought from RPI - one deal. Then Craigs sold to investors - second deal.

[flyingfox]

Craigs bought from RPI - one deal. Then Craigs sold to investors - second deal.

So who is the final buyer?will there be another notice soon?should be for substainstial holding right?

[Balance]

So who is the final buyer?will there be another notice soon?should be for substainstial holding right?

According to NBR, shares spread far and wide. Unless someone took 5% or was bumped up above 5%, no SSH notice will be filed.

[macduffy]

So who is the final buyer?will there be another notice soon?should be for substainstial holding right?

Not necessarily.

Might have been placed with multiple clients of Craigs.

[peat]

Gaynor criticises the large transaction
http://www.nzherald.co.nz/personal-finance/news/article.cfm?c_id=12&objectid=10644990&pnum=0

[winner69]

.... also criticises the uraguay mangement arrangement as well ... something more relevant to PGW

[winner69]

referring to the reciever selling the PGW shares

What is overlooked is that on receivership the holders of these investments became unsecured creditors and as such had no right to the underlying shares anyway if thats what they wanted.

One poitn Gaynor made is that these things should never have been offered to retail investors (deemed to be not sophtisticated to understand etc) because they were not what they were made out to be

[flyingfox]

Of course they won't tell anyone before acquisition if they don't have to,...otherwise they can't get it at 52,,,so to me this article make no sense, what i doubt is the receiver is acting as who's best interest?

[mouse]

The new bank proposals from Pyne Gould would, it seems to me, leave quite a bit of room for PGG Wrightson to expand their finance business.

[winner69]

PGG WRIGHTSON SEEKS TO UNLOCK INVESTOR VALUE


Must be getting desparate if they need to use a restructure as a way to 'unlock' investor value

Becoming more efficient and putting greater focus (think that was the word they used) on business operations -.... jeez you'd think that they would do being that all the time .... this announcement implies that they haven't really been that efficient and focussed but i recall several restructures over the years so what's going on

Seeing a headline like that suggested that they were going to something eally exciting that really 'unlocked investor value' (sort of implies there is such a thing and that they think PGW shares should be trading a lot higher) //// like floating off or demerging parts of the business

Or maybe this is just the prelude to that sometime later this year

What a silly announcement and punters don't seem to have got too excited about all this value being unlocked have they

Wonder what the next trick will be to get the shareprice up .... better operational performance wouldn't be on the agenda would it ////aybe, just maybe. it is

[Logen Ninefingers]

PGG WRIGHTSON SEEKS TO UNLOCK INVESTOR VALUE


Must be getting desparate if they need to use a restructure as a way to 'unlock' investor value

Becoming more efficient and putting greater focus (think that was the word they used) on business operations -.... jeez you'd think that they would do being that all the time .... this announcement implies that they haven't really been that efficient and focussed but i recall several restructures over the years so what's going on

Seeing a headline like that suggested that they were going to something eally exciting that really 'unlocked investor value' (sort of implies there is such a thing and that they think PGW shares should be trading a lot higher) //// like floating off or demerging parts of the business

Or maybe this is just the prelude to that sometime later this year

What a silly announcement and punters don't seem to have got too excited about all this value being unlocked have they

Wonder what the next trick will be to get the shareprice up .... better operational performance wouldn't be on the agenda would it ////aybe, just maybe. it is

Same with that PGC announcement about the mooted 'Canterbury Bank'. Their shareprice is loitering around the 43-44 cents per share marker. Maybe these people think that buyers are going to come rushing in whenever these announcements are made. The reality is people are wary - they've been burnt before and they want to start seeing some value in it rather than loads of hot air.

[percy]

Logen Ninefingers and Winner69.
May pay you to go to NZX web site and look under rules. Read Continuos Disclose.Then you will understand why these companies have made those announcements.They are required to.

[winner69]

Logen Ninefingers and Winner69.
May pay you to go to NZX web site and look under rules. Read Continuos Disclose.Then you will understand why these companies have made those announcements.They are required to.

Yeah I know they prob need to disclose such things .... but with such hurrah under the guise of 'unlock investor value'? ... what a lot of ols ahite .... and I missed the word 'seek' in the headline the first time around

[Logen Ninefingers]

Logen Ninefingers and Winner69.
May pay you to go to NZX web site and look under rules. Read Continuos Disclose.Then you will understand why these companies have made those announcements.They are required to.

Fair point.

[GR8DAY]

.......at least they're trying Winner......yes maybe a bit of hype over not much but still better than doing nout.........and yes it could just be the beginnings of "unlocking investor value".....hope so.

[percy]

yes it could just be the beginnings of "unlocking investor value".....hope so.[/QUOTE]

Well said GR8DAY,I absolutely agree with you,yes well said.Once you have the team headed in the right direction it is easier for the team to achieve their goals.It has begin!!

[COLIN]

My first reaction on reading the announcement was similar to W69's: Experience has taught me to be very wary when this type of psycho-babble, management consultancy speak, is used, i.e. phrases such as "unlocking investor value". Here are some choice examples I kept from another corporate re-structuring exercise that I came across once:

"...tentative corporate strategic thrusts...."
"...coherent reinforcing management processes.."
"...visible value system shifts..."
"...exploitable strategic insight..."

It all sounds mighty impressive, but pretty meaningless really.

[minimoke]

"...tentative corporate strategic thrusts...."
"...coherent reinforcing management processes.."
"...visible value system shifts..."
"...exploitable strategic insight..."

It all sounds mighty impressive, but pretty meaningless really.
These probably deserve their own thread - "Lister Babble" and we could enlist Vicki to find a Babel Fish for a monthly prize.

[percy]

These probably deserve their own thread - "Lister Babble" and we could enlist Vicki to find a Babel Fish for a monthly prize.

I think you are right.I look forward to it .I was thinking we should include great company outlooks from the Chaiman at AGM.I allways loved " we are well positioned for the upturn".
Great sell signal!!!

[winner69]

PGG WRIGHTSON MAKES CHANGES TO INCREASE SHARE PRICE

For some time the Directors of PGW have been concerned about thr significant gap between the intrinsic value embedded in its operations and the prevailing shareprice. The directors believe that the intrinsic value of each PGW share is $1.00

The Directors have engaged leading consultancy firm McDunk & Associates to advise them with possible actions that the Company could take to close this gap.

McDunk & Associates studied all aspects of how the gap could be closed - ranging from how the Company communicates to the market in general to ascertaining what makes investors want to buy shares in a company.

As a result the Compnay has appointed Gertrude McGonagle as Chief Tea Lady. Gertrude's main role will be ensure that the tea leaves are aligned in the teacups in such a way that there is greater chance for the share price to increase. Her role will elso involve company communicatiions as McDunk & Associates has advised that communiactions from Chief Tea Ladies have more credence with market participants, mainly because they are perceived to be more credible and generally more understandable than other communication methods used.

Investor value will thus be unlocked from both an increasing share price and from the savings from a more focused and efficient Corporate Affairs and Investor Relations function. Direct savings from disengaging our current PR consultants and corporate communication advisors in excess of $1m will be made as aresult of this change

The Directors see thais as more than just a tentative corporate strategic thrust. This new approach is a coherent reinforcing management process and is a visible value system shift with exploitable strategic insight - the payback will be PGW shareprice closer to intrinsic value

[peat]

good to see market surveillance and duty of disclosure working on behalf of the small people

[percy]

winner69.The most reassuring post I have ever read.It wonderful to see the restructing wiil again put the company"in growth mode"I would feel that this announcement will be most welcomed by astute investors who will drive the SP to all time highs well above any intrinsic value.The corporate thrust statement also gives greater credence to the Exploitable strategic insight.Does this mean the tea lady has found her glasses?

[winner69]

good to see market surveillance and duty of disclosure working on behalf of the small people

Careful how you use the phrase small people? .... he BP head honcho got into trouble about calling the ordinary american ...small

[winner69]

Gertrude failing in her new job .... the tea leaves seems to have scared punters off more than the corporate PR hype as PGW sinks clsoe to its all time low

But maybe the tea lady is just that more credible

[percy]

Gertrude failing in her new job .... the tea leaves seems to have scared punters off more than the corporate PR hype as PGW sinks clsoe to its all time low

But maybe the tea lady is just that more credible

It is comforting they have not gone into a trading halt.!! I have the upmost faith that Gertrude will lead us to the promised land.I expect her band of loyal tea ladies to rally to the cause.
A new company flag, and lets hope a new company song( that we may join in the chorus )that will be sung at future company revial meetings to be held at local Methodist Church Halls weekly until such time the SP far excedes the instrinsic value.

[winner69]

I have been told by reliable sources that she fancied a bright red and blue tableclothe with a yellow blob in the middle for the boardroom table ...... but agrees that it might not be entirely appropriate ..... 'ah so our chinese directors might be offended .... now I get it' she said

Have reverted to glass tablemats with a koru engraved in them

[mouse]

I went to hear John Key in the Theatre Royal, Christchurch, a couple of weeks ago. He told us he had one less Mercedes Benz car now, with the one he arrived in suffering a down-turn with an energetic protester of 17 years jumping on the roof of said dented Merc. At least that is what is alleged and what the photos showed. We have to wait to find out if it actually happened, or if it was actually the tea-lady egged on by Wanda the fish. :)

The other thing that stuck in my mind was John Key saying that our primary production, milk and meat, would very substantially upturn in the next few years. Unlike the Merc which had a down-turn. I cannot remember his figures, but they were impressive. PGG-Wrightson is well positioned to benefit from the upturn. Hopefully not a 'flash in the pan,' but a steady increase in value. The sp is low. A time to seriously think of getting more. Further, and this is important I think, but it is only a hunch, that I shall get a dividend from PGG Wrightson quicker than either Pyne Gould or Pike River. ;)

The low sp is due to no dividend. Has anyone any idea of what a 2 cent dividend would do to said sp? So the point is, we can look forward to a short-term upturn in sp PLUS a longer term upturn. Based on primary production increase. I think it may be prudent to reduce my shares in Pyne Gould and increase them in PGG-Wrightson. :mad ;:

My misgivings about Pyne Gould is my view of the almost certainty that there will be no dividend for 12 months at least. Plus the near certainty of a cash call when the bank amalgamation takes place. An alternative, for a quick profit, is to buy Mercs that have been jumped on and repair them. Selling cheap now. I further think the 'cash call' could be 50% of sp value. Judging from the past record. :ohmy:

Your opinions please? :D

[percy]

Your opinions please? :D[/QUOTE]

I do not think your wife will mind you replacing her damaged car with the ex John Key Merc.My only concern is has it been modified to run on Pike river coal?May pay to check it could run as a wood burner, as water blasting Pike coal may mean it is too damp to burn.I am sure MARAC will do you a good deal on finance.

[mouse]

I do not think your wife will mind you replacing her damaged car with the ex John Key Merc.My only concern is has it been modified to run on Pike river coal?May pay to check it could run as a wood burner, as water blasting Pike coal may mean it is too damp to burn.I am sure MARAC will do you a good deal on finance.[/QUOTE]

Holden Commodore repaired and working well. Around $3,000 damage. But that included a wonderful clean. The car now looks brilliant. My wife, and I are so pleased to be driving a 6 cylinder car again. She refused to drive the loan car. Handbag motoring at the least, could be described in even worse terms than that. Mind you, the damaged Merc would have been nice. I have a space for it if delivered! Two lumps of Pike Coal in my front garden. Used to be the only Pike coal that had got over the hill.

[mouse]

Mouse is surprised that PGGWrightson, having put out a presentation to shareholders, are not being discussed here as to what they propose. It seems there are 'core functions', but that these may change from time to time. So Core could become not core. We also have a decline in shareprice. Which is not too serious since I only have about 10,000 shares. My experience is that you reshuffel the chairs when things are not going well. What happens after that is a bit of a problem. Will we sink, or sail into pastures Green? Or would that be called running aground?
All comments welcome. I havent a clue, but I am suspicious.

[flyingfox]

i want to say something but found there's nothing to say......because everything i ever expected about this share hasn't came true....

[Snoopy]

Mouse is surprised that PGGWrightson, having put out a presentation to shareholders, are not being discussed here as to what they propose.

What are PGGW management proposing mouse? I got the idea that the seeds business was now recognised as more of an international growth engine. Shouldn't PGW managment have figured this out years ago? Perhaps with all the internal NZ integration of Pyne Gould Guinness and Willaims and Kettle and the concommitant blowout in company debt, their eye was off the ball? So do we conclude that up until now the seed business has not been well managed? Or are they just saying that the Norgate dream of setting up NZS style companies all over the world is off the radar?

SNOOPY

[Snoopy]

Mouse is surprised that PGGWrightson, having put out a presentation to shareholders, are not being discussed here as to what they propose.

Was pleased to see that in the farm service business, they are now recognising that relative market strength in the different sectors, is something that should be monitored. Or even crowed about!

SNOOPY

[percy]

What are PGGW management proposing mouse? I got the idea that the seeds business was now recognised as more of an international growth engine. Shouldn't PGW managment have figured this out years ago? Perhaps with all the internal NZ integration of Pyne Gould Guinness and Willaims and Kettle and the concommitant blowout in company debt, their eye was off the ball? So do we conclude that up until now the seed business has not been well managed? Or are they just saying that the Norgate dream of setting up NZS style companies all over the world is off the radar?

SNOOPY
I agree with you their eye was off the ball.
Norgate had grand plans which I expect would have put pressure on management's time,NZS, the dead meat deal etc.Whether his plans would have worked at another time or not we will never know.What we do know is the company now has an excellent board,strong balance sheet,and capable management who are focusing on achieving the growth and profits from areas where they see the company's strength.The company has a great brand.
I therefore feel shareholders will enjoy the fruits of goods seeds carefully sown.

[Balance]

Sum of parts bigger than current market value.

That's what PGW is trying to show shareholders and the market.

[percy]

Sum of parts bigger than current market value.

That's what PGW is trying to show shareholders and the market.

Exactly.
Some mighty good parts in there.

[Balance]

Exactly.
Some mighty good parts in there.

So PGW is doing a strip-tease?

[percy]

So PGW is doing a strip-tease?

Balance,
Sorry but you have me stumped for a reply!!

[root]

I can't see anything that suggests PGW is about to break out of the down trend it's been in for the past 6 months, but I'm ready to buy back in as soon as there is a glimmer of hope. Looks cheap at this price.

[percy]

I can't see anything that suggests PGW is about to break out of the down trend it's been in for the past 6 months, but I'm ready to buy back in as soon as there is a glimmer of hope. Looks cheap at this price.

Wise thinking.

[GR8DAY]

.......the poor sods that were paying $3 or so for this stock!!......i thought 54c was a screaming bargain, might have to get the chekbook out again if this keeps up.

[Phaedrus]

The long downtrend grinds on. See how effectively TA has kept you out of this stock, though! None of the 4 oscillators at the top of the chart have triggered a Buy signal.

This chart provides some good examples of the importance of confirming any buy signal before acting on it. See how a break of the magenta trendline indicated a "buy" signal at the blue arrow? Would you act on that? No - there was no confirmation from any other indicator. It is not good practice to act on any signal in isolation. Look too at the OBV plot. See the "big money" getting in at the blue arrows? Normally this is regarded as Bullish and a buy signal. Note, though, the total absence of any confirmatory signals. The big money is not always the smart money!

I was tempted to append a swag of bullish comments from people that have been holding (and buying!) PGW all the way down, but it seemed a bit unsporting given the losses they have incurred. The usual suspects are all there though. Fundamentalists, permabulls, big noters, optimists all.

I can but repeat my usual admonitions :-

Don't hold onto downtrending stocks.
Don't buy downtrending stocks.
Don't add to losing investments.
Don't average down!

http://i602.photobucket.com/albums/tt102/PhaedrusPB/PGW715.gif

[h2so4]

P. with respect I feel there is something off when your charts are filled with quotes from posters.

I have read through this thread and think alot of posters have been confused over the value of PGW. I encourage posters to get back on their horse, take a step back and try and figure out what they may have done wrong. I know that if I ever had a reason to be confused about a share price I would sell.

[percy]

Phaedrus.
Thank you for another excellent chart and sage advice.

[Dr_Who]

Cheers Phaedrus.

Looks like it is going lower?

[peat]

looks a bit like an ending diagonal to me so this final spike down might be the end.
IF it is then recovery would be swift.

[percy]

Cheers Phaedrus.

Looks like it is going lower?

Reminds of the Limbo dance "how low can you go?"
peat "wouldn't be nice"


ps No one needs to tell us how low it can go,as we have been there more times than we would like to admit!!

[Phaedrus]

Looks like it is going lower?Well, it fell another 4% today. RVI is falling. RSI is falling. RMI is falling. Stochastic is falling. In the face of that little lot, I am inclined to agree with you!
PGW closed today at 47 cents - right on previous support. Would you be prepared to put money on that support level holding? I wouldn't!

[mouse]

Well, I just posted a comment yesterday, Why? and the sp collapsed! Is it best to keep your mouth shut? Should I comment on SCF?

[Balance]

Well, it fell another 4% today. RVI is falling. RSI is falling. RMI is falling. Stochastic is falling. In the face of that little lot, I am inclined to agree with you!
PGW closed today at 47 cents - right on previous support. Would you be prepared to put money on that support level holding? I wouldn't!

What about NUF and ELD?

ELD looks like it may have broken the downtrend?

[Phaedrus]

Maybe the big money is just happy to soak up those terrified by a falling share price and not smart enough to do a bit of FA. Who are the big losers here Belg? Those not smart enough to do a bit of TA! Those who put all their faith in FA and totally ignored market sentiment. Those so confident their "valuations" were right that they had no exit strategy. ST's best and most experienced FA held PGW when it was $3 - and still holds.

Some highlights from the 2008 AGM Report :-
Norgate gave a bullish outlook.
Rural Supplies well ahead of budget
Fruitfed well ahead of budget.
Increased demand for agricultural chemicals.
Increased demand for seeds.
The drought conditions earlier in the year made many farmers try the supplementary animal feed molasses based liquid. It worked so well that many farmers are continuing to use molasses now the drought is over.
Pumping division 'going great guns'
Irrigation booming
Finance on a quarter to quarter annual comparative basis is benefitting from the larger capital base built up over the year.
The drop in the exchange rate can only work for farmers (and PGW) over the coming year.
PGW projected profit maintained at $46m-$51m for PGW's underlying operations for FY2009.

Good solid fundamental stuff there eh Belg? Yet PGW was already in a steep downtrend - and kept right on falling.

Market sentiment is a very powerful force. You ignore it at your peril.

[flyingfox]

Who are the big losers here Belg? Those not smart enough to do a bit of TA! Those who put all their faith in FA and totally ignored market sentiment. Those so confident their "valuations" were right that they had no exit strategy. ST's best and most experienced FA held PGW when it was $3 - and still holds.

Some highlights from the 2008 AGM Report :-
Norgate gave a bullish outlook.
Rural Supplies well ahead of budget
Fruitfed well ahead of budget.
Increased demand for agricultural chemicals.
Increased demand for seeds.
The drought conditions earlier in the year made many farmers try the supplementary animal feed molasses based liquid. It worked so well that many farmers are continuing to use molasses now the drought is over.
Pumping division 'going great guns'
Irrigation booming
Finance on a quarter to quarter annual comparative basis is benefitting from the larger capital base built up over the year.
The drop in the exchange rate can only work for farmers (and PGW) over the coming year.
PGW projected profit maintained at $46m-$51m for PGW's underlying operations for FY2009.

Good solid fundamental stuff there eh Belg? Yet PGW was already in a steep downtrend - and kept right on falling.

Market sentiment is a very powerful force. You ignore it at your peril.

come back and see these postings after 6 months, must be very interesting..

[Balance]

Relax, Belg, me ole matey.

Real fundamental value never changes.

Remember what P wrote about RBD before it went up ,up and away?

[Snoopy]

The drought conditions earlier in the year made many farmers try the supplementary animal feed molasses based liquid. It worked so well that many farmers are continuing to use molasses now the drought is over.


Care to expand on that Phaedrus? I don't recall reading about ongoing molassass substitution for other feed in those annual reports.

SNOOPY

[Stranger_Danger]

Belg,

Did you really just suggest you/"big players" will get tax law changed because a guy on a forum posted some charts with some cut and paste comments?

Far out, that makes turning water into wine look like amateur hour!

[Snoopy]

Look too at the OBV plot. See the "big money" getting in at the blue arrows? Normally this is regarded as Bullish and a buy signal. Note, though, the total absence of any confirmatory signals. The big money is not always the smart money!


Phaedrus, those OBV spikes in April and May on your chart represent closely the times when Rural Portfolio Investments liquidated their PGW holdings respectively via two holding companies. In the first instance AMP Capital Investors bought a large block of those RPI shares (but not all). In the second instance no substantial security notices were filed on the buy side. That means the holding was broken up. So contrary to what your OBV indicator said I would argue those PGW shares were being distributed. And from the point of view of today you would have to say that the big money player -RPI- got it right. What do you say about that?

SNOOPY

[Lizard]

Belg, given the nature of your transactions as presented on ST, I would have presumed you would be effectively paying tax on most of your capital gains anyway. I would have thought asking for audit issues if you were not, particularly given the size and frequency of transactions you've suggested. Though I can't speak for Phaedrus, I seem to remember Phaedrus disclosing in the past that he does. (I am probably too small to need to worry about an audit, but I still pay tax on my own trading profits.).

That aside, what is your own valuation on PGW? I am probably far too conservative as doesn't hit the "buy" level on my figures till about 20cps on current data.

[Dr_Who]

How much debt to PGW have and what is the banking covenants on those debt?

[Snoopy]

How much debt to PGW have and what is the banking covenants on those debt?

"A short form prospectus issued for the proposed bond extension reveals that on a contractual maturity analysis as of March 31, PGG Wrightson had NZ$412.2 million of financial liabilities, including bank loans, debentures and bonds maturing within a year out of a total of NZ$477.9 million worth of financial liabilities. This includes NZ$65.5 million worth of deposits and other borrowings, NZ$32 million of bank loans, NZ$131.9 million of bonds and NZ$178.8 million worth of debentures."

"The company also had NZ$454.7 million worth of loans and receivables due within 12 months of March 31 out of a total of NZ$557.9 million worth of total financial assets"

SNOOPY

[Snoopy]

"Darrow said PGG Wrightson Finance's total debenture book now stood at about NZ$250 million. Having a high percentage up for renewal within 12 months was nothing new."

"I think habitual investors tend to invest for terms of between three and 18 months, that's where most people put their money," said Darrow. "(So) that type of maturity profile has always been there and it's nothing unusual."

from
http://www.interest.co.nz/news/pgg-wrightson-finance-confident-investor-bank-support-ahead-nz412-mln-funding-maturity-wall

SNOOPY

[Balance]

How much debt to PGW have and what is the banking covenants on those debt?

LOL - less than NUF and ELD. Do you know what they are for NUF and ELD?

It's the ability to service debt ad reduce debt which is most important. PGW is actually retiring debt ahead of schedule.

Meanwhile, NUF is negotiating with its banks to waive a breach of covenant. If the banks do not, it's rights issue time again.

Likewise, ELD - now trading at 33% of its rights issue price.

[Dr_Who]

"Darrow said PGG Wrightson Finance's total debenture book now stood at about NZ$250 million. Having a high percentage up for renewal within 12 months was nothing new."

"I think habitual investors tend to invest for terms of between three and 18 months, that's where most people put their money," said Darrow. "(So) that type of maturity profile has always been there and it's nothing unusual."

from
http://www.interest.co.nz/news/pgg-wrightson-finance-confident-investor-bank-support-ahead-nz412-mln-funding-maturity-wall

SNOOPY

Thanks Snoopy.

Makes interesting reading.

[Phaedrus]

I don't recall reading about ongoing molassass substitution for other feed in those annual reports.

AGM Report 2008. From an operational perspective the Craig Norgate (Chairman) and Tim Miles (Managing Director) 'show' gave a bullish outlook.
With the first quarter results in, Rural Supplies and Fruitfed are well ahead of budget. This is thanks largely to increased demand for agricultural chemicals and seeds. The drought conditions earlier in the year made many farmers try the supplementary animal feed molasses based liquid. It worked so well that many farmers are continuing to use molasses now the drought is over.


Phaedrus, those OBV spikes in April and May on your chart represent closely the times when Rural Portfolio Investments liquidated their PGW holdings respectively via two holding companies. In the first instance AMP Capital Investors bought a large block of those RPI shares (but not all). In the second instance no substantial security notices were filed on the buy side. That means the holding was broken up. So contrary to what your OBV indicator said I would argue those PGW shares were being distributed. And from the point of view of today you would have to say that the big money player -RPI- got it right. What do you say about that?I'd say that they eventually got it right - better late than never! Of course I feel sorry for whoever bought, big or small, their "investment" in PGW has been falling by 6%/month. The OBV is a very simple indicator and can, of course, oversimplify complex situations. For example, one institution selling to another institution is neutral, neither accumulation or distribution. There is an interesting thing here, though. You will be aware that OBV is not the only volume indicator - the Accumulation/Distribution indicator is also commonly used and it showed the second "step" as a sharp drop, indicating distribution - exactly the conclusion you came to, and the right one here, I am sure. PGW was being distributed from a single large holder to many small holders. The important point here is this. Good, bad, indifferent, right or wrong, those OBV "signals" would have been ignored. They were firing in total isolation with no confirmation from any other indicators.


What! The 2008 report? not sure which point you're trying to prove....I was illustrating how FA players gain the confidence to hold on to downtrending stocks from bullish management reports such as this. The market, unconvinced, knew better.


Were the big holders stuffed? Nope. They're the big pension funds ...whose horizons are not measured by lines on a graph. Perhaps not - but their returns certainly are!


These people are doing their best to create and preserve wealth...Right - so let's look at how they measure up. Something like 85% of funds underperform the index!


When the market goes down, are you saying that all the holders are "dumb money"? No - but I would say that it is pretty dumb to hold on to a stock and do nothing for 2 years while it falls from $3 to less than 50 cents! I don't care how good the fundamentals may be, what management claims, or what the "longterm" outlook is, holding downtrending stocks is not a good idea.


Whats most relevant to the shareprice is what will happen in the next 12 months. This is what FA and macro players focus on - the next 12 months or even longer.Right. And that's what "FA and macro players" were focussing on all the way down as the shareprice plunge continued.


It is these people that create the powerful force called market sentiment. Thankfully it is not. The market is bigger than "these people". Observe the long slide while "these people" (focussed on the long term) were holding. A force more powerful than them was in play. They fought the market - and lost. That's what happens.

[Snoopy]

No - but I would say that it is pretty dumb to hold on to a stock and do nothing for 2 years while it falls from $3 to less than 50 cents! I don't care how good the fundamentals may be, what management claims, or what the "longterm" outlook is, holding downtrending stocks is not a good idea.


The long term investors return isn't as bad as a you make out Phaedrus. Those shares purchased at $3 it turned out later included a right to purchase 9 more shares at 45c for every 8 held. So the average price paid by those 'buy and hold' investors for who bought at $3 was actually

[8($3)+9($0.45)]/17 = $1.65

That doesn't change your claim of the net result being awful of course. But let's not alter the facts to overdramatise the story.

SNOOPY

[Dr_Who]

Dr, You'd be reminded of the old banker adage: "Never borrow short to lend long" - it leads to sleepness nights.

I'll sleep better after the 28th July bondholder meeting.

Yes, that quote reverberates in my head every time I pay a visit to my solicitor to sign a document and my accountant. Now, if only you can drum that into investors who lend to finance companies.

[mouse]

Having around 10,000 shares is a good number. You can work out easily how much you have lost. My buy in price was 61 cents average. Close today was 47 cents. Ergo, I have lost $1,400 if I sell today.
Now, should I buy more and average down, or hold and wait for a better tomorrow?

[winner69]

Having around 10,000 shares is a good number. You can work out easily how much you have lost. My buy in price was 61 cents average. Close today was 47 cents. Ergo, I have lost $1,400 if I sell today.
Now, should I buy more and average down, or hold and wait for a better tomorrow?

Only you can make that decision mate

Belg would say double up and start a pyramid .... if they go down to 40 cents you can double up again and then you would have 70000 at an average pruce of 45 cents .... and then you can make a killing

Snoopy would probably say if you really love them buy some more at this discounted price .... but only use the housekeeping money

Phaedrus would say ...... you know

My advice - you decide what's best ..... but i think you will be buying some more anyway

[h2so4]

Only you can make that decision mate

Belg would say double up and start a pyramid .... if they go down to 40 cents you can double up again and then you would have 70000 at an average pruce of 45 cents .... and then you can make a killing

Snoopy would probably say if you really love them buy some more at this discounted price .... but only use the housekeeping money

Phaedrus would say ...... you know

My advice - you decide what's best ..... but i think you will be buying some more anyway

Yes indeed....do what's best for you.

[mouse]

Yes indeed....do what's best for you.
Will todays steal be tomorrows fraud? Maybe I should 'hold.' Accept the loss?
What will "The Market" do? Up or Down? You see, it is only housekeeping and cheaper than money on the horses. There are also 'certainties' there of course.

[percy]

Will todays steal be tomorrows fraud? Maybe I should 'hold.' Accept the loss?
What will "The Market" do? Up or Down? You see, it is only housekeeping and cheaper than money on the horses. There are also 'certainties' there of course.

I do not follow the horses however I think you have 1 to 3 odds with shares.Share price will either 1 go up,
2 go down
or 3 stay the same
then the life of the sharemarket is a lot longer than a horse race, but good blood line,good training,good food pays of in both fields .

[h2so4]

Having around 10,000 shares is a good number. You can work out easily how much you have lost. My buy in price was 61 cents average. Close today was 47 cents. Ergo, I have lost $1,400 if I sell today.
Now, should I buy more and average down, or hold and wait for a better tomorrow?


Will todays steal be tomorrows fraud? Maybe I should 'hold.' Accept the loss?
What will "The Market" do? Up or Down? You see, it is only housekeeping and cheaper than money on the horses. There are also 'certainties' there of course.

I'm afraid I don't have those answers. If your happy to lose it (and only you know that ) then great.:)
If I was unsure about holding a company I would sell. It sort of changes your approach, you start off angry but, you get over it, you can sort of accept it and then when you start feeling OK with it then that is the time to try and make it back.(if that is what you want to do) but you dont have to make it back the same way by holding the same share or averaging down.

[Snoopy]

"a contractual maturity analysis as of March 31, 2010 (cf June 30 2009)

PGG Wrightson had $412.2m ($340.6m) of financial liabilities, including bank loans, debentures and bonds maturing within a year out of a total of $477.9m ($506.6m) worth of financial liabilities. This includes $65.5m ($83.0m) worth of deposits and other borrowings, $32m ($71.5m) of bank loans, $131.9m ($123.6m) of bonds and $178.8m ($221.1m) worth of debentures."

"The company also had $454.7m ($426.4m) worth of loans and receivables due within 12 months of March 31 out of a total of $557.9m ($575.4m) worth of total financial assets."

On rereading the reference I think these figures are for PGG Wrightson Finance, not the group as a whole. Comparisons from 9 months previously (inserted) are of interest.

SNOOPY

[rabcat]

An interesting discussion on what will happen to the PGW Share Price.

To me PGW biggest problem is that it has never made the level of profit it should. The amalgamation of Wrightsons Pyne Gould and Reid Farmers was ment to improve efficience but I dont think it ever eventuated.

This year it predicts a $20m profit with 750m shares on issue. i.e. 2.6 cents per share.

Maybe next year $50m i.e. 6.6 cents per share.

If the share price is to go any where the board needs to be working out how it will produce a profit of $100m to $150m to provide some value to share holders.

[percy]

An interesting discussion on what will happen to the PGW Share Price.

To me PGW biggest problem is that it has never made the level of profit it should. The amalgamation of Wrightsons Pyne Gould and Reid Farmers was ment to improve efficience but I dont think it ever eventuated.

This year it predicts a $20m profit with 750m shares on issue. i.e. 2.6 cents per share.

Maybe next year $50m i.e. 6.6 cents per share.

If the share price is to go any where the board needs to be working out how it will produce a profit of $100m to $150m to provide some value to share holders.

I think the board are.

[Snoopy]

PGG Wrightson had $412.2m ($340.6m) of financial liabilities, including bank loans, debentures and bonds maturing within a year.
The company also had $454.7m ($426.4m) worth of loans and receivables due within 12 months


Matching the loan terms of borrowers and lenders is the perpetual task of a finance company manager. I would give Mark Darrow of PGGWF top marks here. It looks like he will avoid serious mismatches even if the vote to extend some of the borrowers terms is lost on July 28th.

SNOOPY

[mouse]

[QUOTE=rabcat;312107]An interesting discussion on what will happen to the PGW Share Price.
The amalgamation of Wrightsons Pyne Gould and Reid Farmers was ment to improve efficience but I dont think it ever eventuated.

I read somewhere, cannot remember where, that 75% of amalgamations etc result in a loss for the shareholders. By amalgamation I mean that shares are issued, little cash changes hands. They then have the problem of getting the various companies working together. A good example of this problem was Time and AoL. You get bigger and bigger until eventually you Burst.
If this is true, Burst, what will happen to PGGWrightson plus of course our next little amalgamation of Canty Savings Bank and Pyne Gould?
Comments please. Plus examples of successful amalgamations.

[percy]

[QUOTE=rabcat;312107]An interesting discussion on what will happen to the PGW Share Price.
The amalgamation of Wrightsons Pyne Gould and Reid Farmers was ment to improve efficience but I dont think it ever eventuated.

I read somewhere, cannot remember where, that 75% of amalgamations etc result in a loss for the shareholders. By amalgamation I mean that shares are issued, little cash changes hands. They then have the problem of getting the various companies working together. A good example of this problem was Time and AoL. You get bigger and bigger until eventually you Burst.
If this is true, Burst, what will happen to PGGWrightson plus of course our next little amalgamation of Canty Savings Bank and Pyne Gould?
Comments please. Plus examples of successful amalgamations.
you only have to remember the very successful amalgamation of Pyne Gould Guiness with Reid Farmers.It is interesting to note that George Gould who oversaw it is now on the board of PGW.
Successful mergers;well you only need to look a local company EBO.You must also remember PGW is made up of the amalgamation of williams and Kettle,Fruitfed supplies,Pyne Gould Guiness and Reid Farmers,Wrightson which of course came of Wrightstephenson and National Mutual and somewhere in there Dalgetys.
I think we are on track.It is just how far down the track are we/.Good people,Great company.The Time Warner AOL merger failed because each company failed to understand the other.AOL was pie in the sky.Time Warner were a media company and AOL were internet.Huge disaster.
Back to EBO.In 1990 EBO had a market cap of $2mil.Today it has a market cap of $312mil.

[rabcat]

[QUOTE=percy;312121][QUOTE=mouse;312116]
you only have to remember the very successful amalgamation of Pyne Gould Guiness with Reid Farmers.It is interesting to note that George Gould who oversaw it is now on the board of PGW.

Well I hope you are right and PGW can turn into a sucessful company. I hope George Gould can make a difference.
It seems PGW have many good parts such as the finance company, Fruit fed, the seed business yet the sum of the parts does not produce a good result.
They have a large turnover ( over $1 Billion)huge market share but produce minimal profits. Something is wrong and the board needs to fix it.
I hope with the annual report we see some leadership from the board on how they intend to improve the bottom line otherwise the share price will continue to slide