PGW revises earnings guidance as farmer spending drops
Rural trader PGG Wrightson has revised its operating earnings guidance, saying trading conditions have deteriorated since the last market update in February.
PGG Wrightson chief executive Mark Dewdney says PGG Wrightson (PGW) expects its full year earnings before tax in the $65 to $68 million range, up from the previous guidance of $61 to $67 million indicated in April.
Dewdney says its New Zealand earnings continue to exceed expectations. A strong autumn sales season in New Zealand underpins this earnings performance, and shows the resilience of PGW in spite of the challenging conditions being experienced in some agri-sectors.
The company now expects its retail business will improve on last year's record Operating EBITDA. "This will be a fantastic achievement given the cautious spending from our dairy clients over the year. This will be a result of the positive momentum we have sustained with customers and staff, and in part our exposure to sectors that have had a strong year, such as horticulture and beef."
He says the operating EBITDA for the year to June 30 will reflect two opposing forces.
"On the one hand tougher market conditions, particularly in the New Zealand dairy sector and in South America; on the other, the hard work we are putting into improving and growing PGW continues to pay off and we are benefiting from our market position in the agri-sectors that have been performing strongly."
PGW expects to announce its full year results on August 9 with details of the announcement to be confirmed closer to the time.
