The Christchurch company reported a net loss after tax of $17 million in the six months to December 31, compared to a net profit after tax (npat) for the previous corresponding period (pcp) of $22.1 million.
PGC subsidiary Marac reported an npat and impaired asset expense of $20.4 million ($22.8 million pcp), Perpetual Trust a npat of $2.4 million ($2.7 million pcp) and PGG Wrightson a net operating profit beforetax of $22.1 million.
Write-downs, abnormal items and market adjustments resulted in a loss for PGG Wrightson of $32.8 million, of which Pyne Gould Corporation's (PGC) share was $6.9 million.
This compared to a contributing profit last year of $7.5 million.
PGC's result was pulled down by the provision of impaired asset expenses for Marac of $9.3 million, its share of PGG Wrightson's net loss and the under-writing provision for Marac of $25 million for the "prudent" management of property loans.
Chief executive Brian Jolliffe said in an interview that he was happy with the result, giventhe difficult market.
The performance of Marac's core business was steady compared to last year, the company was attracting strong support from retail depositors at $794 million, including $104 million from a five-year bond issue.
This compared to $557 million last June.
Reinvestment rates were "at the upper end of historical averages," averaging 74% in the December quarter.
Provision for the writing-off of bad and doubtful debts has been increased from $1.8 million to $9.3 million.
Half the $25 million property management provision remained, which represented 9.5% of the total property development loan book.
Operating revenue from Perpetual Trust fell just 6% to $8 million, while a tight rein on costs saw a 4% reduction.
Mr Jolliffe said the next six months would be quiet for Marac, but there were opportunities such as motor vehicle financing, given two financiers had recently withdrawn from the market.
Marac has picked up some dealers and aimed to gain a bigger slice of what was a smaller pie.
Mr Jolliffe said in an interview that Marac was also supporting business clients to help them through the difficult financial period, in some cases renegotiating loan terms.
"If it is a solid business, it is not in our interest to do things that put that business in jeopardy."
Looking ahead, Mr Jolliffe was optimistic the South Island would weather the global downturn better than the North Island, because of the performance of the rural sector.
He said South Islanders were more confident than North Islanders and those in the regions more confident than those in urban centres, due to the strong performance of the sheep and beef industries, in particular.
"I agree with most commentators who say New Zealand will come out of this recession better than most countries and New Zealand will be led out of it by the rural economy," he said.
He expected Marac and Perpetual Trust to have a similar second half of the year to the first, while PGG Wrightson has maintained its earlier full year profit forecast.
Directors have announced a reduced dividend of 5cps, viewed as a prudent step, given the drop in profitability and market uncertainty.
Last year the dividend was 10cps.
