The result was skewed by changes to accounting standards, but ABN Amro Craigs investment adviser Peter McIntyre said the result was an accounting loss of $32.8 million, of which there was a fair value non-cash adjustment of $47.7 million, leaving a net profit after tax (npat) of $4.6 million.
On a like for like basis, this compared with an npat of $12.5 million for the previous corresponding period.
Investors reacted favourably to the result, with shares ending up 7c at 79c yesterday after falling from $1.28 a month ago to a low of 68c.
Mr McIntyre said PGG Wrightson had answered most of the questions investors had sought answers to, such as addressing its debt and a time line for debt repayment.
The only issue left unaddressed was the liability for the failed Silver Fern Farms' partnership and the likely time to resolve the dispute.
Mr McIntyre said the result was better than expected, but it appeared the second half of the year would be weaker than expected, given the company's full-year guidance was unchanged.
The interim result was underpinned by contributions from rural and technology services and new acquisitions, he said.
Chairman Craig Norgate reassured investors about the health of the company, which had seen negative investor reaction to its debt and last week's spat with Silver Fern Farms over the level of compensation.
Mr Norgate confirmed that cornerstone shareholder Pyne Gould Corporation (21.4%) was retaining its stake "in the short term" and Rural Portfolio Investments (29.7%) was "in the advanced stage" of refinancing $45 million in redeemable preference shares.
He said the board had complete faith in the management and praised its performance.
Chief executive Tim Miles said banking commitments had been finalised for the company's $400 million of core debt and $75 million in seasonal debt.
Repayment plans were also announced, with $125 million to be paid back by December 2010 through operating cash flow and working capital initiatives, such as better inventory management.
A further $275 million term debt was repayable on September 30, 2011.
There would also be savings from lower staff numbers through a no-replacement policy, which has seen total staff and contractors down about 150 on a year ago.
Mr Miles said there were no plans for redundancies.
Ten of the company's 13 business units achieved similar or better results to the previous corresponding period, with the contribution from real estate a negative, down $4.3 million.
"Our market share has grown but the pool of activity has reduced," Mr Miles said.
PGG Wrightson reported a net operating profit before tax of $22.1 million, an increase of 32% on the previous result of $16.8 million, but non-trading items led to the accounting loss of $32.8 million,Included in that accounting loss was a $35.1 million write-down in the value of shares in New Zealand Farming Systems Uruguay, accountancy adjustments and $13.1 million from marking to market of contracts and defined benefit schemes.
Operating revenue was up 32% to $738 million.
The PGG board has amended its dividend policy as part of its debt amortisation.
It will pay a dividend of 5c a share this year, but has decided in the future it will no longer offer the facility of buying back bonus shares paid as the dividend.
Instead, it will offer shareholders cash dividends through an underwritten system.
Looking ahead, Mr Norgate said agriculture should come through the global slowdown well.
He expected global dairy prices to start improving, as customer inventory levels were depleted and they would start buying product again.
That could be later this year or early next, but he expected current market conditions to continue for the rest of the yearPGG Wrightson had enjoyed strong trading through January and was on track to meet its end-of-year forecast profit of $39 million to $45 million.
