Christchurch, New Zealand
October 19, 2016
Agria Corporation (NYSE: GRO) (the "Company" or "Agria"), a leading global agriculture company, today announced that its New Zealand-listed subsidiary PGG Wrightson Limited (NZSE: PGW) ("PGW") disclosed its guidance for fiscal year 2017.
PGW expects net income to be flat with FY 2016 net income, and Operating EBITDA to be in a range of NZ$62 to NZ$68 million.
Mr. Alan Lai, Executive Chairman of Agria and Chairman of the PGW Board, commented, "PGW faces challenging conditions in the trading environment, but is committed to sustaining its profitability in the coming fiscal year. In New Zealand, cattle volume is strong and the horticulture market is robust. Conversely, wool demand is soft and irrigator sales are down, due to the ongoing weakness in the dairy sector. In general we see a marginally tougher environment to start the year. Furthermore, we still do not know the full extent of the impact of the flooding in Uruguay.
"Over the past three years, we have transformed PGW into a robust and resilient enterprise, poised for high growth in benign environments and able to sustain profitability in tough conditions. Our guidance demonstrates our confidence in the strategy. Despite the challenges in our markets, we intend to earn at least as much as last year, even while we invest in future growth opportunities."
Lai concluded, "Our confidence in the prospects at PGW is reflected in our ADS repurchase program, which commenced earlier this month. We are actively repurchasing our ADSs daily. The ADS repurchase program is an outstanding use of capital, since our ADSs remain substantially undervalued relative to the assets owned by Agria. Our economic interest in PGW is worth over $130 million at PGW's current trading prices and exchange rates. Looking at our total balance sheet including other assets and debt, our net asset value is over $1.50 per ADS. As long as our ADSs remain so undervalued, we will aggressively repurchase our shares."
PGW's announcement and management comments can be accessed via the following link: http://pggwrightson.co.nz/our-company/nzx-announcements
All references to PGW refer to PGW, its subsidiaries and its interests in associates and jointly controlled entities.
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