PGG-Wrightson - controlled by Singapore-based Agria - has
delivered a turnaround result from last year's first-half
loss of almost $6 million for an after-tax profit of $3.1
PGG's managing director, George Gould, said the improved
operating results were underpinned by increases in
profitability from the company's livestock, retail and real
The AgriTech operation, which includes seeds, grain and
nutrition, reported earnings broadly in line with last year.
PGG shares were up slightly at 40c, following the
"Overall, PGG Wrightson's operating profitability has
improved as the company follows its plan which is simply to
offer high quality service and products to its farmer clients
throughout New Zealand, Australia and South America," he said
in a market statement yesterday.
Craigs Investment Partners broker Peter McIntyre said PGG had
been through a "three-year transformation". The turnaround
result earned management a "B+ on getting things right" for
shareholders, who will now be expecting a dividend.
Mr Gould said that PGG Wrightson's financial position had
improved by selling the finance company and it would enjoy
lower debt servicing costs.
Heartland New Zealand, which wants to apply for a banking
licence, bought PGG's finance unit for about $98.2 million
and, according to the accounts, PGG made a $3.37 million loss
on the sale.
Since Agria took control of PGG, the company has been
streamlining its business and selling assets. PGG's board did
not declare an interim dividend and has not made a return to
shareholders since 2010, BusinessDesk reported.
PGG's earnings before interest, tax and depreciation (ebitda)
increased 55% to $22 million.
The AgriTech unit, responsible for seed and grain research,
reported ebitda of $38 million from $33 million a year
The retail unit, responsible for rural supplies and Fruitfed
operations, increased to $17.1 million from $13.9 million.
Its livestock unit jumped to $3 million from $539,000.
Earnings from other AgriServices, which include insurance,
wool and real estate, were $1.29 million from a year-earlier
loss of $1.8 million.
AgriServices' earnings rose to $21 million from $12.6
At the end of 2009, PGG had a rights issue and Agria Corp
acquired a 19% stake, which by April last year had risen to a
50.22%. Agria is jointly owned, directly or indirectly, by
Beijing-based Agria Corp and New Hope, one of China's largest
agricultural and food corporations.