PGW first-half profit up 180 pc

ALAN WOOD
Last updated 16:13 25/02/2014

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PGG Wrightson says a stronger first-half net profit of $13.4 million came on increases in most parts of its business and improved conditions on farms.

For the six months to December 31, the rural services company reported operating profit (Ebitda) of $22.3m, up from $18m for the previous first half.

The $13.4m bottom-line result for the six months was up from a first-half profit of $4.8m in the six months to December 31, 2012.

PGW chief executive Mark Dewdney, who took up the role last July 1, called it a strong result with increases recorded across most areas of the business.

"PGW is on a steady path to reclaiming its position as a leading option for investors looking for exposure to the ongoing strength of New Zealand agriculture," Dewdney said.

"This half-year result reflects gains in our underlying performance and improved conditions on-farm. Staff throughout our many businesses are working with renewed energy and focus to make the most of our group's strengths."

Dewdney said Christchurch-based PGW was completing a wider review of its overall business strategy, with the results to be shared with the market in the next few months.

"At the annual shareholder meeting in October, we forecast operating Ebitda for the current financial year to be $52 million to $56m. While we have had a very strong start and are $4 million ahead of the same period last year, we have not changed our full-year forecast," he said in a statement.

The rural services firm declared a fully imputed dividend of 2 cents a share to be paid to shareholders on the register on March 12. The dividend will be paid on April 2, and is down from an interim dividend of 2.2 cents paid last year.

Twelve months ago, the Christchurch-based rural services firm announced its first dividend in four years.

At the time of that 2012-13 interim result, its shares were trading around 41 cents.

This afternoon, the shares were up 2c, or nearly 5 per cent, at 44c.

On a like-for-like basis, the revenue total of $635m compared to $589m for the first half of 2012-13.

PGW chairman Alan Lai, who is based in China, said the company was pleased to see significant improvement across all segments of its core businesses, adding: "Our group is now in a more solid financial position as a result."

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- Fairfax Media

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