PGG Wrightson Earnings Guidance Update

Chief Executive Ian Glasson today reaffirmed PGG Wrightson’s (PGW)* earnings guidance for the 2018 financial year. PGW expects its full year Operating EBITDA** to 30 June 2018 to be in the previously-announced guidance range of $65 to $70 million; an increase on 2017’s $64.5 million. Mr Glasson said that "Overall, the agricultural sector in New Zealand remains robust and is having a profitable year with solid production and good prices. PGW’s Australian and South American businesses have faced tough conditions, with both regions being too dry to meet their sales targets. Despite these headwinds we continue to expect an increase in overall Operating EBITDA for PGW this year, with PGW sharing in the broader prosperity in the NZ agriculture sector, highlighting the resilience of its diversified business model.” Mr Glasson noted with respect to the recent Mycoplasma bovis outbreak that “Despite having little effect on PGW’s financial performance to date, PGW is working closely with its customers to monitor the impact on the broader sector.” Mr Glasson also reaffirmed PGW’s expectation that reported net profit after tax (NPAT) from normal trading was forecast to be approximately 25% lower than last year’s $46.3 million given that there would not be the benefit of significant property sales (FY2017, $8.7 million) in the current financial year. “The recent dip in the value of the New Zealand dollar means our export currency hedges are likely to mark-to-market as an unrealised loss.” Mr Glasson explained. “There are also non-trading items outside Operating EBITDA that have the potential to impact reported NPAT in FY2018. For example, as is the case with many large NZ employers, PGW is continuing to work through a process to quantify the cost of historical liabilities under the Holidays Act 2003. In October 2017 it was announced that the Board had made a joint appointment of Credit Suisse (Australia) Ltd and First NZ Capital Ltd as financial advisers to assist with a strategic review of PGW’s business, its growth opportunities, capital and balance sheet requirements, and potentially shareholding structure. Mr Glasson noted that the strategic review was progressing well and it was hoped that PGW would be in a position to comment further on outcomes from this work later in the year. [See attached for table] PGW expects to announce its full year results on 14 August 2018 with details of the announcement to be confirmed closer to the time. Ian Glasson Chief Executive Officer 15 June 2018