PGW - PGG Wrightson

[Snow Leopard]

Pension scheme:

Firstly a Big Grrrrh! to winner69 for bring up the subject in the first place.

Moving any amount of money into funding the pension scheme does not affect the profit at all per se.

But if you read Note 19 first then the entire accounts through twice, you should work it all out to the extent that is humanly/felinely/caninely possible.

Not something I am going to worry about at this point in time.

Best Wishes
Paper Tiger

[winner69]

Pension scheme:

Firstly a Big Grrrrh! to winner69 for bring up the subject in the first place.

Moving any amount of money into funding the pension scheme does not affect the profit at all per se.

But if you read Note 19 first then the entire accounts through twice, you should work it all out to the extent that is humanly/felinely/caninely possible.

Not something I am going to worry about at this point in time.

Best Wishes
Paper Tiger

Meeow to you tiger

I did tell Snoops it was complicated .... with a lot of the impact going through Other stuff but good to see shareholders still paying the old pensioners

And I see you use the word 'yet'

[Beagle]

This dog is with the cat on this non issue.

[winner69]

This dog is with the cat on this non issue.

I never said it was an issue - but maybe it is for long serving and ex emplyees


(PGW should just do the decent thing and put the $25m odd into the pensions funds and ensure they are always fully funded to meet promised employee entitlements, now and in the future)

[Snoopy]

Moving any amount of money into funding the pension scheme does not affect the profit at all per se.

Rolling some of the company debt around to shore up the PGW pension funds does not affect the underlying profits of the PGW operation, that's true. IMO it is the underlying operating profit that is most important.

Pension funds rise in and out of deficit with the vicissitudes of the investment market. It is important not to put too much weight on one event in one particular year. But the PGW pension funds have been washing around for quite a few years since Agria came on board. And they have always been in deficit to the tune of $10m plus. It is true that a plan deficit will not directly affect the business until that deficit money has to be paid out. But statistically it will have to be paid out. To do nothing is just to put off the day of reckoning. And there comes a time for 'high noon', on the day of reckoning. Alan Lai has been able to stay out of the high noon sun so far. But look at the big picture (table below), and you will see why Alan is now straightening his stetson.

	FY2017(F)	FY2016	FY2015	FY2014	FY2013	FY2012	FY2011
PV of Defined Benefit Obligation		$73.417m	$72.153m	$68.330m	$72,765m	$$75.495m	$69.425m
FV of Plan Assets		($52.702)m	$(57.498)m	$(54.802)m	$(51.946)m	$(49.231)m	$(52.175)m
Plan Deficit		$20.715m	$14.655m	$13.528m	$20.819m	$26.264m	$16.970m
PGW Group Contribution	$9.51m	$1.08m	$1.16m	$2.93m	$3.81m	$2.32m	$2.24m
Member Contribution	$0.97m	$1.01m	$1.08m	$1.15m	$1.15m	$1.13m	$1.38m
Balance Sheet
Total Liabilities		$412.9m	$285.6m	$364.8m	$363.4m	$402.7m	$844.7m
Total Equity		$274.3m	$267.4m	$269.7m	$256.1m	$577.7m	$604.3m
Equity/Assets		39.9%	41.0%	42.5%	41.3%	41.1%	41.7%

One figure in the table above in the FY2017 column stands out from the others.

The equity position of PGW is now at its weakest since Agria came on board. So now is not the time for big spending unless it is absolutely necessary. So why is PGW management suddenly forecasting that their contribution is to increase in FY2017 by a factor of 10, when PGW is at its weakest? I would argue that he fund has been out of balance for a very long time and now the day of reckoning has arrived. Some may choose to sit in the saloon and drink their beer and claim nothing is wrong. But I think you 'no worries' shareholders should be on the street at high noon if you don't want to miss the action.

Not something I am going to worry about at this point in time.

Best Wishes
Paper Tiger

Not until 'High Noon' anyway :-)

SNOOPY

[winner69]

Snoops - the pension plans were in suplus in 2008. It all turned to custard in 2009 and has got worse since

Wouldn't want another share market collapse would they with 79% assets in equities? The liabilities generally don't reduce unless actuarial wizardry happens.

$25m mightn't sound much but a 34% plan shortfall is significant (and not good) .....and quite significant % of funding/sponsoring company's shareholder equity. The trustees should be worried.

Snoops - i think we pissing punters off, never mind

[Snow Leopard]

...

	FY2017(F)	FY2016	FY2015	FY2014	FY2013	FY2012	FY2011
PV of Defined Benefit Obligation		$73.417m	$72.153m	$68.330m	$72,765m	$$75.495m	$69.425m
FV of Plan Assets		($52.702)m	$(57.498)m	$(54.802)m	$(51.946)m	$(49.231)m	$(52.175)m
Plan Deficit		$20.715m	$14.655m	$13.528m	$20.819m	$26.264m	$16.970m
PGW Group Contribution	$9.51m	$1.08m	$1.16m	$2.93m	$3.81m	$2.32m	$2.24m
Member Contribution	$0.97m	$1.01m	$1.08m	$1.15m	$1.15m	$1.13m	$1.38m
Balance Sheet
Total Liabilities		$412.9m	$285.6m	$364.8m	$363.4m	$402.7m	$844.7m
Total Equity		$274.3m	$267.4m	$269.7m	$256.1m	$577.7m	$604.3m
Equity/Assets		39.9%	41.0%	42.5%	41.3%	41.1%	41.7%

One figure in the table above in the FY2017 column stands out from the others...

Of course it does, there are only two numbers (in the column) and you have embolden one of them and put a box around it!

...you should work it all out to the extent that is humanly/felinely/caninely possible...

Well that was a statement of optimism over experience - I never learn.


Best Wishes
Paper Tiger

[Out to lunch]

Can't see much more upside with grain decreasing in price will compress margins.
Also unusual that Agria NYSE.GRO hasn't moved in line with this new PGW profit? Parent's other subs must be dragging the chain or am I missing something here.

[Agrarinvestor]

Can't see much more upside with grain decreasing in price will compress margins.
Also unusual that Agria NYSE.GRO hasn't moved in line with this new PGW profit? Parent's other subs must be dragging the chain or am I missing something here.

Agria has focused on cost reduction in China and NZ. I don't expect a big cash burner in china. Currentli Agria is searching for institutional Investors. IMO they will not start the
share repurchase until they have found some investors. I expect some attention at earnings release conference. If i have the feeling that they have some attention i will buy more.

AGRIAs shareprice has fallen by 10 cent since they announced the 10 Million US$ buyback and the pleasent earnings update of PGW.
Short Sellers have manipulated the price and destroyed confidence.

Yesterday almost 90% of the volume was sold by short sellers: 20160815|GRO|4100|0|4300|Q http://regsho.finra.org/regsho-Index.html

I'm hoping for earnings release on Friday. Should be a good chance for quick profit.

[Agrarinvestor]

Still hoping that AGRIA will make extnsive use of their share buy back.

But this seems to be important for PGW shareholders:
http://www.agriacorp.com/news-show.asp?id=289


And some remarks from the Call Transcript:
http://ir.agriacorp.com/phoenix.zhtm...-presentations
>>Finally, as I mentioned earlier, we have prefunded the purchase of New Hope stake in Agria AsiaInvestments, subject of course to the New Zealand regulatory approval.<<


>>Yes. We will hold actually the closer—by which time we’re done New Hope, we will hold 50.22% togetherwith our New Zealand native partners, which will hold—which will continue to hold about 11%, and unlessof course—unless because—unless of course if that process means that we need to complete the NewZealand Takeover process, it could be a completely different scenario because New Zealand—the NewZealand Takeover rules has very low threshold in terms of mandating a full takeover.<<

>>The most important is this: if you own one Agria ADS, you own two shares of a company thatactively controls and benefits from one of the largest and most respected agricultural companies in thesouthern hemisphere. You own a 40.58% economic interest in that company that is valued at $2.10 perADS. Netting out the debt and other liabilities of your company, we can reasonably argue that the valueof your company is at least $1.60 per ADS.<<

>>Our second source is our China seeds business, NKY. Weowned this business before taking control of PGW. Although it is a small company relative to our currentsize, it is strategically important. We intend to use NKY as the platform for PGW products <<

It seems that Agria is very optimistic about PGW business and ability to generate cash.