It was the perfect anniversary present.
On the day that PGG Wrightson chief executive Stephen Guerin marked 34 years with the company, it posted a record result for the first half of the 2022 financial year, including a $53million increase in revenue.
Yesterday, PGW announced an after-tax net profit of $22.5 million, up $5.5 million on the prior corresponding period and operating ebitda of $47.4 million, which was up $7.8 million.
It also declared a full imputed interim dividend of 14c per share and announced an increased operating ebitda guidance for the full year of $62million.
Mr Guerin said there was confidence in the rural sector, commodity prices in general and across the sector for New Zealand primary exports.
While a degree of volatility in international markets continued with disrupted supply chains, inflationary pressures and a global pandemic, PGW’s business was diversified and continued to adapt to clients’ and market needs.
During more than three decades in the business, Mr Guerin said he had seen cycles and he was "pretty positive about the result and where the sector was at the moment.
There were some challenges, including labour and regulatory matters, but overall confidence was "pretty high and he continued to hope the sector got the recognition it deserved.
It was the strongest first half trading for retail and water on record. Operating ebitda for that group was $43.7 million (up $10.1 million) and revenue was $469 million, (up $55.6 million).
Given supply chain challenges PGW has been actively seeking to mitigate supply risks, Mr Guerin said.
It had been sourcing products earlier and was carrying more inventory, as well as working closely with suppliers on product forecasts and availability.
Livestock activity for the first six months has been impacted by wet weather conditions in the North Island and Covid-19 restrictions including saleyard closures during Alert Level 4.
It continued to reinvest in the business through upgrades to its saleyard network and investment in new technologies.
The bidr hybrid auctions were seeing growing use with dairy herd dispersal and deer sales, in addition to stud bull and ram sales.
Since the launch of saleyard livestreaming during the last six months, bidr’s user base had grown by 30%.
There had been "substantial growth in rural real estate sales in the si- month period which he described as the best result in many years.
Mr Guerin was proud PGW had been nominated as a finalist for the 2021 Deloitte Top 200 Most Improved Performance Award which recognised an outstanding improvement in performance among New Zealand’s largest businesses.
Mr Guerin singled out the people involved in the business — from the customers to the staff and the suppliers — saying that was the reason he was in the job.
"I love agriculture, I love our team, he said.
Asked whether he had concerns about the impact on the business from the spread of Omicron, he said a governance group was constantly monitoring the situation.
It was a highly vaccinated workforce, teams had been split into bubbles, Rat tests were on order and Covid-19 procedures followed.
Chairman Rodger Finlay said the record results were extremely pleasing. During the year, PGW launched its strategy reset and outlined the group’s strategic priorities that "will direct our focus, differentiate our offering, and strengthen our position as a market leader in our sector”, he said.
