PGW - PGG Wrightson

[Dr_Who]

PGW presentation June results had a slide that said core debt was $312m (which excludes PGGW Finance which has bank debt of another $140m) .... thats PGW figures

Is Taylor from Macquaries saying that this the $312m is increasing to $400m then? Would have thought that 'core debt' was 'core debt'

Shouldn't question analysts ... or did the papers just intepret it all wrong

Had a quick look at their books.

I think you are right to say the debt is $400m with $180m due to roll over in April. Their debt to equity ratio is over 100%. I am wondering how they will roll that debt over in this market. Maybe debt raising or selling off assets? It is a big ask to raise that kind of debt in this market.

[Dr_Who]

There's been a flood of corp bonds issued recently and most have been oversubscribed. Its all about the yeild attached. PGG should be okay to roll 180 over.

There is a difference between the finance company and the holding company. The govt do not guaranty the holding company. Do you think they will use the funds raised in the finance company to prop up the holding company debt?

[Snoopy]

There is a difference between the finance company and the holding company. The govt do not guaranty the holding company. Do you think they will use the funds raised in the finance company to prop up the holding company debt?

No they won't Doc. But remember they still have substantial shareholder the budding bank PGC

"Banking Application to the Reserve bank
Our application to the Reserve Bank for a banking licence is on track but we have
made no commitment as to when this will occur. In the present market we need to
maintain some flexibility around timing.
Likewise with our interest in PGG Wrightson. The business continues to trade well,
and although we have signalled our intention to divest, we would not do so into the
present market. We remain uncommitted to any single path to exit or timeframe."

Looks like PGC will put their plans on hold to support PGW if necessary.

SNOOPY

[Dr_Who]

Have you guys read the AWB profit downgrade? Their sp got hammered.

I wonder if AWB has any implications for PGW? I know their business is different, but maybe a rural sector trend?

Warning trashes AWB share price

http://www.theaustralian.news.com.au...018010,00.html

[Snoopy]

Have you guys read the AWB profit downgrade? Their sp got hammered.

I wonder if AWB has any implications for PGW? I know their business is different, but maybe a rural sector trend?

Warning trashes AWB share price

http://www.theaustralian.news.com.au...018010,00.html

Historic PE was just over 7 for AWB before today's hammering. A 25% decline in share price will reduce that PE to just over 5 on last years earnings. However the reason for that plunge is that net profit is expected to fall by 45%-55%. That means the forecast AWB PE is now between 9.5 and 11.5.

PGW is still forecasting earnings of $39m. And with the share price at $1.30, PGW is trading on a forecast PE of 9.6, the lower end of the 9.5-11.5 'AWB' range. Based on this we can expect the PGW share price to *rise* on this AWB result, if indeed there is any connection.

SNOOPY

discl: hold PGW

[Dr_Who]

Where did you get the $39 million forecast from Snoopy?

I am just trying to get the average analyst forecast.

Cheers

[Deev8]

Where did you get the $39 million forecast from Snoopy? I am just trying to get the average analyst forecast.

I believe that it was earnings guidance from PGG Wrightson on 16th December rather than an analyst forecast.

The guidance said:
The Board of PGG Wrightson advises that it has reviewed the group’s net earnings guidance for the year ending 30 June 2009 based on financial performance to date and the current outlook for the remainder of the financial year.

The Board now believes that net earnings are likely to be within the range from $39 million to $45 million. The previous earnings guidance, provided at the Annual Shareholders Meeting in October 2008, was for a range from $46 million to $51 million.

[biker]

....The Board now believes that net earnings are likely to be within the range from $39 million to $45 million. The previous earnings guidance, provided at the Annual Shareholders Meeting in October 2008, was for a range from $46 million to $51 million.


This could well just be downgrade number one......... A long time from Dec 16 to June 30.

Downgrades that far out have a habit of multiplying.

[Dr_Who]

PGW suddenly drop 6% today.

Whats up?

Something negative maybe?

[clips]

isn't that pgc that took a drop today, probably some old dear want a new car and cashed up.... imo there is something or some things negative hanging around pgw..
silverstream farms to be settled.. elders/crt gaining traction on pgw market share.. ++