Joint Venture Condition Confirmation and Trading Update

19 February 2019

Joint Venture Condition Confirmation and Trading Update

DLF Seeds A/S has confirmed another condition in the agreement for sale and purchase of PGG
Wrightson Seeds Holdings Limited (PGW Seeds) relating to counterparty consents required from
research and development joint venture partners.

PGG Wrightson Limited (PGW)** Chief Executive, Ian Glasson said that “t his was further good news
following the recent clearance decisions issued by the New Zealand Commerce Commission and the
Australian Competition and Consumer Commission last week. While we were always confident that this
condition would be satisfied it is nevertheless pleasing to have that formally confirmed.”

The transaction for the sale of PGW Seeds now only remains conditional upon New Zealand Overseas
Investment Office approval and the completion of required regulatory filings in Uruguay.

Mr Glasson said “In December 2018 we flagged challenging market conditions, particularly in South
America where Seed and Grain operate, and to a lesser extent here in New Zealand. For the New
Zealand-based Rural Services businesses (Agency, Retail and Water, and Other) this was largely due to
a later start to spring sales and a delayed recovery following heavy rainfall in the last few months of 2018
across the country. With another two months of trading behind us it has become apparent that the Rural
Services businesses are about five million behind FY2018 performance at an Operating EBITDA* level
for the same period (HY2018: $23.36 million).”

“Given that the majority of our trading for the Retail business (more than 85 percent) occurs in the first
half of the financial year it now appears unlikely that these earnings will be recovered over the remainder
of FY2019. In addition, our Water business continues to be negatively impacted by the lack of on farm
development.”

“This softening in performance is also partly attributable to the impact of weak international demand for
wool and a slow start to the spring season in the rural real estate sector.”

“However, as previously noted, the sale of the Seed and Grain business to DLF Seeds remains on track
with recent confirmations of regulatory conditions in New Zealand and Australia and the consents of our
R&D joint venture partners coming through. We expect that the remaining conditions will also be
confirmed in the near future.”

“It is worth noting that we will be reporting the Seed and Grain business as a discontinued operation in
our half year results that we will announce next week, with the assets and liabilities of that business being
reported as held for sale. On completion of the sale of the Seed and Grain business PGW expects to
record a capital gain of at least $120 million
which would flow through to net profit after tax.”

PGW will be announcing its half year results on 27 February 2019.


For all media enquiries please contact
Linda Chalmers
Group Communications and Brand Manager
PGG Wrightson Ltd
Mobile: +64 27 405 3241


*Operating EBITDA: Earnings before net interest and finance costs, income tax, depreciation, amortisation, the results
from discontinued operations, fair value adjustments and non-operating items.

**PGW has used non-GAAP profit measures when discussing financial performance in this document. For a
comprehensive discussion on the use of non-GAAP profit measures, please refer to the policy “Non-GAAP Accounting
Information” available on our website (www.pggwrightson.co.nz).