Snoopy .
The ground work for PGW "reengaging " was laid by Sir John Anderson and George Gould.
"The Dewd" built on their solid work.
PGW's growth is expected to come from Uruguay,yet no mention of Uruguay in their latest announcement.
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Quite right to acknowledge Sir John and GG for their contribution. We all build on the work of those that came before us. But I do think 'The Dewd' has done a good job since. I hope the new culture of the place can in turn be built on by the new CEO. Maybe time for an internal appointment this time?
PGW has been in Uruguay for ten years. They are trying to replicate the 'One PGW' model in Uruguay, with the move into retail supply to go with what they already had. But that country has been beset by weather events.
My great hope for growth is actually the seeds business, intellectual property with a fence around it, with all the expansion into Australia in recent years. Despite all that , Seeds has never made the kind of money (profit) that it did back in the Craig Norgate years. But I am keeping the faith with this jewel that Alan Lai wanted to split from the rest of PGW before 'The Dewd' came along.
Perhaps in today's frothy market, you could argue that the rerating has already taken place!
Some of us with long memories will recall those years of no dividend at all in the cyclical downturn. If we are just coming to the end of a 'down' year, then I can see a large improvement today. PGW will always be a cyclical. But IMO it is how the down years are handled that the market will assess, in determining where the PE of this share should lie. PE has an attractive dividend yield relative to the rest of the market. When the dividend yield comes closer to the market average, that could be the sign to reduce my stake.
SNOOPY
Hey snoops
Christmas has come early for you
Look at all these numbers PGW have provided you with to analyse. I expect some good insights
https://www.nzx.com/companies/PGW/announcements/305134
I'm sure if you give Peter Scott a ring he'll give you the whole set in an excel file - save you punching them all in from scratch ha ha
First off the block to report earnings...
Basic eps is stated at 6.1 cps but strip out the $9.6m gain on sale of property which the company has ostensibly admitted will not repeat to the same extent next year and we get eps of 4.86 cps. Wages and other expenses which make up the lions share of operating costs have both risen just on 3%, well above the inflation rate and added many millions to operating costs.
I would stick with my time tested PE of no more than 10 for this very average cyclical agricultural stock and see fair value at 10 x 4.86 cps = 48.6 cps.
Disc: Don't own and not looking to acquire. I am sure the other hound has considerably more time to analyse this and will post more interesting insights but with my limited time available at present that's my 2 cents worth.
Cash Flow Statement is what really matters
Operating cash flow down quite a lot on last year
And one could construe that that selling (unwanted) assets paid for the dividend - fair enough
Reducing the likely earn-out provision on Uruguay acquisition by $2.4m is interesting
Uruguay not making as much as they thought it would?