SEK, PGW, SCL- Why are these 3 NZX agri stocks receiving attention?

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SEK, PGW, SCL- Why are these 3 NZX agri stocks receiving attention?

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 SEK, PGW, SCL- Why are these 3 NZX agri stocks receiving attention?
Image source: © Wisconsinart | Megapixl.com

Highlights:

  • Seeka expects NPBT to be between NZ$9.0 million and NZ$11.0 million for FY22.
  • PGG Wrightson is to pay 16.0 cps as the final dividend next month.
  • Scales Corporation appoints a new non-executive director to its Board.

Agriculture plays a key role in NZ's economy and contributes a substantial chunk to the nation's GDP. The Kiwi Government has undertaken a new NZ$26.1 million program, the largest-ever comprehensive study on the sustainability of pastoral farming across New Zealand.

The key aim of this program is to examine the potential benefits of diverse pastures for grazing animals and regenerative farming practices. It will involve several Crown Research Institutes, industry groups, iwi, investment and consumer groups, which will provide additional guidance, thus helping the nation to grow its farm exports and be a preferred choice for food and fibre for customers across international markets.

With this background, let us walk through the three well-known agriculture stocks listed on the NZX.

Source: © Artiso | Megapixl.com

Seeka Limited (NZX:SEK)

Functioning as a produce company, Seeka Limited, is engaged in orchard, post-harvest operations, marketing, etc., and has about NZ$161 million as its current market capitalisation.

A few days ago, SEK released its unaudited HY22 performance, with EBITDA clocking NZ$49.4 million, up 5.3% on pcp, NPAT growing 4.3% to NZ$21.5 million, and revenue growth of 10% to NZ$247.3 million, despite unfavourable weather events, shipping disruptions, extreme labour shortages and lower fruit yields. It anticipates its FY22 NPBT to be between NZ$9.0 million and NZ$11.0 million and aims to become carbon neutral by 2050.

On 5 September, at the closing bell, Seeka traded flat at NZ$3.900.

PGG Wrightson Limited (NZX:PGW)

Christchurch-based PGG Wrightson Limited is engaged in the agricultural services business and has a market cap of nearly NZ$353 million.

In its recently declared FY22 results, PGW’s operating EBITDA jumped 20% to NZ$67.2 million, revenue climbed 12% to NZ$952.7 million, and NPAT advanced 7% to NZ$24.3 million, owing to the strong performance of its Retail & Water businesses and responding well to supply chain challenges.

It has announced a dividend of 16.0 cps, which will be paid on 3 October, thus taking the total dividends for the year to 30.0 cps. It is likely to release its FY23 expectations at its Annual Meeting to be held next month.

On 5 September, at the closing bell, PGG Wrightson was down 0.85% to NZ$4.640.

Scales Corporation Limited (NZX:SCL)

Scales Corporation Limited has been providing essential services to the country’s primary sector for over 120 years and has around NZ$662 million as its market cap.

Miranda Burdon has been inducted into its Board and will function as an independent non-executive director. She has about two decades of executive and entrepreneurial experience and is presently the Chair of Meadow Mushrooms, Emerging Proteins NZ.

On 5 September, at the closing bell, Scales Corporation dipped by 1.30% to NZ$4.570.

Bottom Line

New Zealand’s agriculture companies are committed to optimising their operations, increasing local market volumes, building strong customer relationships, and enhancing shareholders’ value.

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