Four or five years of consistent dividends from PGW will mean the sp will adjust upwards and the yield downwards and you will have missed the excellents SP growth as well as the high yields.
In the meantime keep metaphoricaly rooting! lol.
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I calculated tax payable for FY2014 at $11.8m, based on NPBTx (1-0.28), which is assuming a 28% tax rate. The actual tax payable was $8.472m. How can a company continue to pay tax a rate lower than the NZ corporate rate? In the long term it can't. There are all sorts of reasons why the actual tax paid was less than my 'Continuing Profit' calculation in FY2014.
What I am implying (and now saying) is that going forwards PGW looks like it will be paying more tax than it does now. That isn't good for PGW shareholders.
SNOOPY
I have looking at the PGW balance sheet and thinking, how could I hide some debt in there, natural cynic that I am?
One way to hide your debt is to not pay your bills. Of course I don't mean "don't pay any bills" as all your suppliers would stop doing business with you if you adopted that policy. But what about if you were just a bit slower in paying your bills?
Have a look at the "accounts payable and accruals" section of the balance sheet, under LIABILITIES, current. The accounts payable have gone up by $17.404m over the calendar year. If those 'extra bills' were suddenly paid, PGW would have to borrow the money to do so, putting an extra $17.404m on the company debt pile. What say you Roger, is there some 'financial engineering' going on here?
Now go up the balance sheet to the ASSETs, current and look at 'Trade and Other Receivables'. There you will find $18.908m more worth of 'Trade and Receivables' on the books compared to last year. If PGW collected that extra money, that would be cash that they could put towards reducing their borrowings. That would be a good thing, even if it is a bad thing that in reality they did not collect that money by balance sheet time.
So does not collecting their extra dues, balance out the fact that PGW are a bit slow paying their suppliers at the other end? Or does all this mean the company is just getting lazier?
SNOOPY
Snoopy, It just means everyone in business is taking a little longer to pay their bills. Some on here are over-thinking this. Maybe Sunday is a good day to groom and walk their own dog(s) :)
Snoops me old mate
PGW Beneish M Score is -2.69 / -2.54 using the 8 variable model
if M > -2.22, the firm is likely to be a manipulator
Announcement this morning - CEO bought 50,000 more shares last week at 42.5 cents. Looks like I was in very good company last week doing the same thing :)
What a lot of people don't realise is that Beef farmers have had a HUGE YEAR and there's no sign of it letting up anytime soon.
4Seasons feed limited was a joint venture in the supplementary liquid animal feed market, set up on 1st August 2012. Joint venture partners were PGW (50%) and International Nutritionals Limited (50%). International Nutritionals is in turn owned jointly by RD1 and the Australian company Wilmar Gavilion. On 31st May 2014, PGW sold out to its joint venture partners.
According to this article
https://agrihq.co.nz/article/pgg-wri...ns-feeds?p=214
the ultimate divestment of 4Seasons Feeds was part of PGWs grand plan.
The 2014 cashflow statement shows that proceeds from the sale of investments net of cash totalled $21.1m during the year. Those proceeds included 50% of Gramins PTY Limited and Australian company that was deregistered (assume zero cash inflow for that) and 20% of "Di Santi y Romualdo LTDA", a dairy farm auction and liquidation business partly owned in Uruguay. In FY2013 "Di Santi y Romualdo LTDA" PGWs share of that business contributed a loss of $0.427m to the bottom line.
Assuming all of the sale of investment cash inflow was for 4Seasons Feeds (that assumption should overestimate the value of 4Seasons Feeds if anything) , that means the total 4Seasons Feeds business was valued at $42.2m as at 31st May 2014. Profits earned for an 11 month period were $4.048m. So the sale was on a PE of:
$42.2m/ [$4.084m x (12/11)] = 9.5
The margin of this business was: $4.048m/$55.192m = 7.3%
Compare that to PGWs own margin of under 3%.
My question is this. Why did PGW agree to sell a relatively high margin core business at what seems to be a bargain price? Because of this their profit will be hit by over $2m a year going forwards. Yet the profit on the sale was a measly $4.848m (note 10). Next year the total declared profit at PGW will take a hit of over $6.8m because of this sale. Why did PGW agree to sell their investment in this company, when on the face of it, it seems to be exactly the sort of company they should be buying?
SNOOPY
Percy, Note 23 contains all the information Mark did not release during the year when he purchased Water Dymanics. The fair value of Assets and Liabilities was $7.62m. Yet Mark only paid $6.38m. So we shareholders booked a 'profit' on this purchase of $1.24m Woo Hoo! Or is it too good to be true?
We learn that:
"If the significant acquisition of Water Dynamics and Aquaspec had occurred on 1 July 2013, the estimated Group revenue would have been $6.12 million higher and profit would have been $0.17 million higher for the year to 30 June 2014."
The margin on this new business is:
$0.17m / $6.12m = 2.8%
Makes interesting reading comparing that with the 4Seasons Feeds business we just got rid of doesn't it?
SNOOPY
What you think of that M-score Snoopy
Snoopy - do you ever look at the bottom half of the Statement of Comprehensive Income.
The bit that reduces the $42m profit to $38m (Comprehensive Income)
Some interesting big numbers in that bit