PGW - PGG Wrightson

[Balance]

Great to read that our farmers are in good heart this summer! Obviously good for PGW too.

https://farmersweekly.co.nz/section/...s-feed-surplus

"Warm temperatures and frequent summer rain have led to a bumper season for summer feed crops and pasture covers for livestock farmers in most regions up and down the country.

It’s been a remarkable turnaround compared to 12 months ago, where severe drought had written off feed crops and farmers around the North Island were burning through their feed reserves to keep their stock healthy."

Not surprising that PGW's sp has powered on to another post-capital-repayment high.

[Balance]

From the grapevine :

PGW's livestock online auction going so well that they are expanding the team. Actively recruiting more staff.

[Balance]

https://issuu.com/farmersweeklynz/do...ggestions=true

Looking good for a profitable year ahead for the agricultural sector - but watch for the bumps.

[Balance]

https://www.nzx.com/announcements/367040

Farmgate payout lifted for milk solid - another positive for agricultural sector and for PGW.

[JohnnyTheHorse]

Half year results announced on Tuesday. With the way the industry is performing I'm expecting another profit upgrade. They have indicated a minimum of 10cps interim dividend and I wouldn't be surprised to see increased given the certainly provided in the 2.5 months since the last update.

Disc: been accumulating further the last few days.

[JohnnyTheHorse]

As I suspected dividend increased to a fully imputed 12cps! NPAT up a whooping 41% on pcp. Forward PE must be around or just under 10 now?

Key highlights of the first six months to 31 December 2020 included:
 Revenue of $499.3 million (up 6%)
 Operating EBITDA** of $42.1 million (up $7.4 million or 21%)
 Net Profit after Tax (“NPAT”) of $18.0 million (up 41%)
 Fully imputed interim dividend of 12 cents per share
 Very strong performances from our Retail, Livestock and Real Estate businesses
 Strong balance sheet and improvement in cash flows from the prior comparative period
 Reconfirmed full year Operating EBITDA guidance of around $57 million

[sb9]

As I suspected dividend increased to a fully imputed 12cps! NPAT up a whooping 41% on pcp. Forward PE must be around or just under 10 now?

Key highlights of the first six months to 31 December 2020 included:
 Revenue of $499.3 million (up 6%)
 Operating EBITDA** of $42.1 million (up $7.4 million or 21%)
 Net Profit after Tax (“NPAT”) of $18.0 million (up 41%)
 Fully imputed interim dividend of 12 cents per share
 Very strong performances from our Retail, Livestock and Real Estate businesses
 Strong balance sheet and improvement in cash flows from the prior comparative period
 Reconfirmed full year Operating EBITDA guidance of around $57 million

Pretty neat result and happy with increased divvy (fully imputed) as well.

[Roberto the Brickie]

Great to see they are not carrying $16 million of cash at a reporting date while still having debt. My question is why have the banking facilities increased by an additional $10 million? The company will be paying line fees on the additional $10 million for two years yet debt has reduced and all the commentary is about good times ahead. Still not convinced about the competencies of the cash management team given that large pot of cash last year, however happy to get a 12 cent dividend. Yet I would still prefer a lesser dividend now and to not see the loan facility increasing, not many assets left to sell if debt starts increasing AGAIN.

[iceman]

Seems to be a good result across all of their businesses which is great to see. Long may it to continue and good to see a healthy fully imputed divie being paid in this financial year.

[Snoopy]

Great to see they are not carrying $16 million of cash at a reporting date while still having debt. My question is why have the banking facilities increased by an additional $10 million? The company will be paying line fees on the additional $10 million for two years yet debt has reduced and all the commentary is about good times ahead.

There was talk in the interim report of ramping up the 'Go Livestock' funding of sheep and cattle. Perhaps the additional borrowing headroom is associated with that?

Still not convinced about the competencies of the cash management team given that large pot of cash last year, however happy to get a 12 cent dividend. Yet I would still prefer a lesser dividend now and to not see the loan facility increasing, not many assets left to sell if debt starts increasing AGAIN.

It is good to see the 'defined benefit liability', associated with the company's in house pension plan, down around $4.5m from the June 2020 deficit of $9.5m. Albeit this is still up from the December 2019 comparative period. I agree with you Roberto though. When times are good, pay down your debt. PGW and Wrightson's before have had a couple of debt mandated assets sales and capital raises in the last twenty years. You would think they would have learned their lesson. However, PGW do have Agria still on the share register. I bet those two Agria nominated directors maintain a big say on the level of dividend payment.

SNOOPY