Wednesday, 05 October 2016 06:55

PGW has a good year

Written by  Pam Tipa
PGW chief executive Mark Dewdney. PGW chief executive Mark Dewdney.

Strength in beef cattle, horticulture and real estate helped offset PGG Wrightson's (PGW) tough year for the parts of the business exposed to dairy.

PGW says it made after-tax profit of $39.6 million in the year ending June 30, 21% up on the previous year.

The company lifted earnings growth for a third consecutive year, to $70.2 million from $69.6m in the previous year.

Chief executive Mark Dewdney says the company is showing the benefit of having diverse exposure in agriculture.

“While New Zealand dairy and our South American business have traded through a challenging period, other areas such as the horticulture sector in New Zealand are doing very well.

“The parts of our business most exposed to dairy, such as water, have had a tough year. However, a buoyant market for beef cattle helped livestock offset the reduced market for dairy cattle and provided a strong finish to the year.”

Fruitfed Supplies, the company’s supplier to the horticulture and viticulture sectors, and its Agritrade wholesaling business, helped retail increase earnings year-on-year, he says. Real estate had good year with growing sales in the lifestyle and horticultural markets.

“Our seed and grain business benefited from the continued shift towards proprietary seed with better technical performance,” he says.

“This trend, and improved performance by our Australian seed business in 2016, resulted in a strong result for our seed and grain group.

“South America was hit hard by a combination of low commodity prices, high rainfall and flooding in Uruguay in April. Despite these headwinds, our South American activities contributed positively to the group result.”

Improving value for customers helped boost market share, and product mix improvements and internal cost efficiency also led to profit gains, he says.

PGW chairman Alan Lai says the board is pleased the performance of the company “has led to an outstanding financial result given market conditions”.

“The progress PGW has made since 2013 is worthy of praise. In three years PGW has grown operating earnings before interest, taxes, depreciation and amortization by around 50%.

“Our balance sheet remains strong and the investments we’ve made over the year will prove crucial.”

More like this

Wool auctions back in action

Wool trading on both sides of the Tasman is back up and running after a cyberattack on industry software provider Talman.

Payout for PGW shareholders

PGG Wrightson shareholders should receive the proceeds of the sale of its seeds business in the coming few weeks.


Get ready for the ‘now’ norm

Get prepared for a ‘Now Normal’ future, says Ian Proudfoot – Global Head of Agribusiness for KPMG – discussing the likely effects of COVID-19 in the months to come.


Northland farmers count the costs

Northland farmers are starting to count the cost of one of the most severe droughts to hit the region as the cost of feed and lower prices for stock are the order of the day.

Times will get better for deer sector

While the deer industry faces several challenges in the short term, there will be a strong rebound in New Zealand venison sales once global demand recovers.

» The RNG Weather Report

» Latest Print Issues Online

The Hound

Dirty water

The Hound understands that Federated Farmers has been cut out of the information loop, for the past year, on the…

Who’s paying?

Your canine crusader noticed a full-page ad recently run in a farming paper calling on meat companies SFF and Alliance…

» Connect with Rural News

» eNewsletter

Subscribe to our weekly newsletter

Popular Reads