PGG Wrightson (PGW) H2 2024 earnings summary

Executive summary

• Operating EBITDA was NZD 44.2 million, down NZD 17 million year-over-year, amid challenging agricultural conditions and reduced discretionary spending.

• NPAT was NZD 3.1 million, down NZD 14.5 million; results included a one-off non-cash NZD 0.9 million deferred tax expense from legislative changes.

• Revenue fell 6% to NZD 915.9 million, down NZD 59.7 million and the first decline since FY2018; Retail & Water accounted for most of the decrease.

• No FY2024 final dividend was declared amid sector and economic pressures; dividend policy remains under review.

Financial highlights

• Operating cash flows rose NZD 32.2 million to NZD 57.7 million, driven by lower cash stock balances and reduced tax payments.

• Capital expenditure increased NZD 5.7 million to NZD 22.8 million, focused on IT improvements and asset acquisitions, including the remaining half-share in Frankton Saleyards.

• Net interest-bearing debt was NZD 59.2 million at June 30, 2024, down NZD 6.1 million year-over-year.

• Syndicated banking facilities were extended through February 2026, supporting working capital and growth.

Outlook and guidance

• New Zealand’s rural servicing market is expected to remain subdued in the near term, with moderate growth anticipated over the longer term.

• Easing inflation and stabilizing input costs are positive, but subdued demand for agricultural imports and services is expected to persist short-term.

• MPI forecasts food and fiber export revenue to reach NZD 67 billion by June 2028.

• FY2025 guidance will be provided after the spring trading period, at the October 2024 annual shareholder meeting.