In an announcement to the New Zealand stock market yesterday, PGG Wrightson (PGW) reported a net profit after tax of $16 million for the six months ending December 31 last year — an increase of 25% ($3.2m) from the previous corresponding period.
Its operating revenue grew 2% to $570.3m, while its operating ebitda rose 13% ($4.7m) to $41.4m.
An interim dividend of 2.5c per share was declared.
PGG Wrightson chief executive Stephen Guerin said the company was being cautious amid speculation of trade tariffs.
"We've got the spectre of what the Trump administration may do in terms of agricultural tariffs, but that's anyone's guess at the moment.
"That could be a wee bit of a dark horizon.
"We don't only export to the US, we export to other markets around the world, and commodity prices are a global factor, not just one economy factor."
But until anything actually happened, PGG Wrightson planned to "get on and do our thing", he said.
Chairman Garry Moore said PGG Wrightson had seen improved returns in rural supplies, a stronger demand for beef and a positive rebound in real estate over the past six months.
Economic conditions were showing early signs of improvement — several indicators pointed to a healthier outlook with lower inflation and easing interest rates.
Agricultural-input prices had stabilised in the past six months but remained above historical norms.
Additionally, a higher forecast milk payout, strong beef export returns, and "generally solid" commodity prices were beginning to positively affect farmer and grower sentiment.
PGW’s outlook for New Zealand's agricultural sector was "promising yet cautious", Mr Moore said.
"New Zealand's agricultural sector is well-positioned to respond to global demand and PGG Wrightson is well placed to support our farmer and grower customers with their production needs.
"We are cautiously optimistic about the remainder of the financial year ..."
PGW forecasted full-year earnings of about $51m.
