Annual Results Announcement to 30 June 2021

PGG Wrightson Ltd | NZX Announcement 1
17 AUGUST 2021
PGG Wrightson delivers
impressive FY21 result


Group Performance
PGG Wrightson Limited* (PGW) today announced its results for the financial year ended 30 June 2021.
Key highlights of the financial year to 30 June 2021 included:
 Revenue of $847.8 million (up $59.8 million or 7.6%)
 Operating EBITDA** of $56.0 million (up $13.8 million or 33.0%)
 Net Profit after Tax (NPAT) of $22.7 million (up $15.0 million)
 Fully imputed final dividend of 16 cents per share
 Very strong performances from our Retail, Fruitfed Supplies, Livestock, Wool and Real Estate
businesses
 Strong balance sheet and operating cash flows leading to a low net interest bearing debt balance
at 30 June 2021
 Continuing solid demand and pricing for New Zealand produce underpinning outlook confidence
for farmers and growers, and in turn agri-services
PGW Chairman, Rodger Finlay said that “...our team and the business have again proved that they are
leaders in the field in supporting our customers, the agri-sector, and rural communities to deliver an
excellent result. The financial year started and finished strongly with year-end Operating EBITDA at $56.0
million, up $13.8 million or 33.0% on last year’s COVID-19 impacted result.”
“PGW also delivered a NPAT of $22.7 million which was up $15.0 million. These results further vindicate
the decisions taken over the last two years in divesting the Seeds business and with the concomitant
recalibration of our cost base and systems.”
“Based upon the strong full year earnings the Board declared a fully imputed final dividend of 16 cents per
share. The dividend will be paid on 4 October 2021 to shareholders on PGW’s share register as at 5pm
on 10 September 2021. This will effectively bring the total fully imputed dividends paid for the year up to
an impressive 28.0 cents per share which I am sure all shareholders will be delighted about.”
“The Directors are particularly pleased that the business has backed up its strong first half result and
has continued to trade well over the second half. This result reflects the collective efforts of the dedicated
team that we have who are passionate about agriculture, supporting our customers and the role the
sector plays for New Zealand. We have seen just how important and critical to New Zealand’s success
the primary sector is and this has come into stark focus through the global pandemic.”
“As a business PGW is clear about its strategy of driving for growth through providing our customers
with sector leading expertise and innovative solutions for their farming and production needs. We look
$56.0m
Operating EBITDA
$22.7m
Net profit after tax
16 cents

Per Share, Fully Imputed
Final Dividend

PGG Wrightson Ltd | NZX Announcement 2
to lead the market through the specialist knowledge and technical expertise of our people. We do this
through investing in their capability and in identifying and bringing to market new products that we source
and prove in New Zealand conditions. Our customers value PGW’s technical offering and see this as a
distinguishing strength that we will continue to develop and foster. Our strong balance sheet allows us
to contemplate earnings accretive growth ambitions, both internal and external.”
Turning now to comment on the performance of our Business Units.
Retail & Water Group
PGW CEO, Stephen Guerin said, “Retail & Water’s Operating EBITDA was a very pleasing $37.5 million
and was up $4.3 million on the prior year’s result; an increase of 13.0%.”
“Both our Rural Supplies and Fruitfed Supplies businesses traded extremely well. We continue to
increase our market share and much of this growth can be attributed to the superior technical expertise
of our staff backed up by our leading product range. We have a very stable rep force who are well
supported by our specialist technical and R&D teams.”
“A significant challenge that we and many other businesses face is around the much publicised supply
chain disruption that is being felt around the world. This will continue to have an impact on the timelines
for sourcing product and grower inputs as well as exports to offshore markets. Our team continues to
work assiduously to proactively minimise supply disruption to our businesses and customers.”
“Our teams have been working collaboratively with our key suppliers, securing and taking product into
stock earlier, and working with customers to lock in their seasonal requirements three to six months
earlier than would ordinarily be the case.”
“Our Rural Supplies business experienced particularly strong growth this year which is a fantastic result
in a highly competitive market. This success is attributable to both new customers who have shifted
business to PGW and also growth in our market share as customers respond positively to our value-
added technical offering and advice.”
“We have employed some great new talent in our business who have brought fresh ideas, and in some
instances, new business. Our sales culture has grown through increased investment in our people and
by providing more training opportunities across all levels of our business with the focus on sales and
service.”
“Our Fruitfed Supplies business has again registered another record year for both Operating EBIDTA
and revenue. This business is diversified across a number of crops and we continue to adapt to
customer and market needs. The horticulture sector is growing and remains buoyant, and we are
continuing to see investment and development.”
“We enjoy impressive market share across a broad range of horticultural crops and with particular
strengths in the grape, pip fruit, stone fruit, and kiwifruit, and we continue to grow in the avocado and
cherry sectors.”
“Our core focus remains to add value to our clients’ businesses through the technical ability of our
Technical Horticultural Representatives (THR) and by supplying specialist products and services. Our
technical expertise offering is differentiated by our expert Technical and R&D teams who support our
field and store staff. This team conducts a number of trials across the industry investigating new
products and chemistry to assist our growers and engage with industry bodies and prove products in
New Zealand conditions.”
“Our wholesale subsidiary, Agritrade, which manufactures, sells, and distributes products continues to
demonstrate positive momentum.”
“Maintaining inventory during the worldwide supply chain disruption created by COVID-19 caused
Agritrade to place orders and receipt stock earlier than usual. Whilst the inability to travel internationally
has hampered product development opportunities, it is nevertheless pleasing to note that five new
products were registered during the year and are being commercialised.”
“We have reshaped the Water business to align with market conditions. This has resulted in an
improvement
in
EBITDA compared to the previous year. Our full-service water and irrigation packages
to customers through Rural Water has seen an increase in sales. However, shipping delays will likely
push out some delivery timelines in the short to medium term.”

PGG Wrightson Ltd | NZX Announcement 3
Agency Group
“Our Agency group incorporates the Livestock, Wool and Real Estate businesses. Trading for this group
is weighted towards the second half of the financial year. Operating EBITDA was $25.2 million and was
up $9.5 million on the prior year’s result; an impressive increase of approximately 60.6%.”
“Our Livestock business has maintained market share throughout the country with the South Island
achieving a very solid result, especially within the sheep and beef sector. During the year strong values
were achieved for sheep farmers, and dairy farmers also received increased pay-outs which in turn
supported our Livestock business. Our Deer business experienced a good velvet season where values
offset lower venison prices.”
“We expanded our GO-BEEF and GO-LAMB product offering and launched GO-DEER. Next year we
expect to add to our GO-STOCK range with GO-DAIRY, which we anticipate will be well received and
grow our GO-STOCK offering further.”
“bidr
®
, our virtual saleyard has run over 400 auctions and sold more than $50 million worth of livestock
since its launch in June 2019. bidr
®
continued its significant software development and in FY22 live
streaming from Fielding, Stortford, Wellsford, and Frankton saleyards will be launched with others to
follow as we roll out this technology. Excellent Livestock Genetics results throughout the year
culminated in the bull sales auction series where bidr
®
’s hybrid platform came to the fore.”
“PGW Wool has done a good job navigating through the ongoing challenges that have been accentuated
by COVID-19. Our team worked closely with growers to reduce their stockpiles of crossbred wool and
did see some benefit from improved pricing in the second half. Our export subsidiary, Bloch & Behrens
worked diligently with overseas customers to ensure contracted obligations to our growers were fulfilled.”
“The Real Estate business has seen particularly strong demand across all sectors of the rural property
market, which has also been fuelled by low interest rates. This resulted in the Real Estate business
experiencing its best returns in over a decade at both an Operating EBITDA and gross commission
income level.”
“We also see early signs of a positive spring for rural sales, with higher than normal appraisals taking
place along with earlier spring listings occurring, which we expect will turn into continuing solid demand
for the first six months of FY22. With strong commodity values in rural we anticipate a number of
retirement and succession initiated listings coming to the market. The shortage of residential and
lifestyle listings may continue with the current low interest rate environment a contributing factor.”
Cashflow and Debt
Mr Finlay noted that “PGW experienced strong operating cash flows during the year which benefited
from the good Operating EBITDA performance and a focus on working capital management and
receivables in particular. This focus has seen PGW’s overdue debtors balance continuing to track to
historically low levels with our book in very good shape.”
“Capital expenditure of $6.8 million was $2.3 million lower than FY20 and was impacted by a slowing in
the implementation of projects as a consequence of COVID-19 related disruption.”
“Net interest-bearing debt was approximately $6.5 million as at 30 June 2021 and is the lowest recorded
at 30 June in over a decade, excluding 30 June 2019 when the proceeds from the sale of its Seeds
business were held.”
Outlook
Mr Finlay said, “The outlook is positive in the rural sector with strong farm gate and commodity prices.
Robust demand is expected to continue for lamb and sheep meat and cattle prices are anticipated to
remain high. There is also confidence in dairy with a positive outlook into next year and a solid pay-out
predicted.”
“Looking ahead, the Board is confident that the PGW is well placed to continue to grow. We have
recently undertaken an internal review of our PGW Group strategy and have reset our Group objectives
and priorities and we are rolling this out within the business currently. This exercise has served to
reconfirm a number of the key themes that are continuing to drive improved performance for the business.
Key in this is our continued focus on the technical expertise of our people and technical offering which
differentiates us from our competitors.”
“There remains a degree of uncertainty globally with increasing geopolitical risks and as new variants of
COVID-19 emerge. Implications from the pandemic will continue to impact consumer markets and the

PGG Wrightson Ltd | NZX Announcement 4
global supply chain. PGW is committed to supporting our customers through these ongoing challenges
and has demonstrated that it can do this effectively and profitably.”
“We would hope to be in a position to provide guidance about our expectations for FY22 at our Annual
Shareholders’ Meeting in October.”
All media enquiries to:
Julian Daly
General Manager Corporate Affairs
PGG Wrightson Limited
Mobile: +64 27 553 3373

*All references to PGG Wrightson Limited or the Group refer to the Company, its subsidiaries and interests in associates and
jointly controlled entities.

**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. Please refer to our full accounts for details of how Operating EBITDA relates
to GAAP. 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

---

$
CONSOLIDATED
FINANCIAL
STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2021
PGG
WRIGHTSON
LIMITED
PGG Wrightson Technical Horticultural
Representative, Rob Wards, inspects
a crop of Royal Gala apples for pests
and diseases at a client’s orchard in
Canterbury in March 2021.

PGG WRIGHTSON LIMITED
PGG WRIGHTSON LIMITED
DIRECTORS’ RESPONSIBILITY STATEMENT
FOR THE YEAR ENDED 30 JUNE 2021
The Directors are responsible for ensuring that the consolidated financial statements give a true and fair view of the
financial position of the Group as at 30 June 2021 and the financial performance and cash flows for the year ended
on that date.
The Directors consider that the consolidated financial statements of the Group have been prepared using appropriate
accounting policies, consistently applied and supported by reasonable judgements and estimates and that all of the
relevant financial reporting and accounting standards have been followed.
The Directors believe that proper accounting records have been kept which enable, with reasonable accuracy, the
determination of the financial position of the Group and facilitate compliance of the consolidated financial statements
with the Financial Reporting Act 2013 and the Financial Markets Conduct Act 2013.
The Directors are pleased to present the consolidated financial statements for PGG Wrightson Limited and its
controlled entities (together the “Group”) set out on pages 1 to 46 for the year ended 30 June 2021.
The consolidated financial statements contained on pages 1 to 46 have been authorised for issue on 16 August 2021.
For and on behalf of the Board.
Rodger Finlay Sarah Brown
Chairman Director and Audit Committee Chair

PGG WRIGHTSON LIMITED
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
For the year ended 30 June 2021
PGG WRIGHTSON LIMITED | 1
2021 2020*
NOTE $000 $000
Continuing operations
Operating revenue 1 847,815 788,036
C
ost of sales
2

(624,589)

(584,050)
G
ross profit
223,226

203,986
O
ther income
366

300
Emplo
yee expenses 7 (119,828) (113,964)
Other operating expenses 3 (47,735) (48,126)
O
perating EBITDA
28(E) 56,029 42,196
Non-operating gains/(losses) 4 4,456 132
Impairment and fair value gains/(losses)
5

1,832

(807)
Depreciation and amortisation expense (27,283) (26,667)
EBIT
28(E) 35,034 14,854
Net interest and finance costs 6 (5,621) (5,032)
Profit from continuing operations before income tax
29,413

9,822
I
ncome tax benefit/(expense)
8

(6,693)

(2,831)
Profit from continuing operations, net of income tax 22,720 6,992
Discontinued operations
Results from discontinued operations, net of income tax
(7)

(371)
Gain on sale of discontinued operations, net of income tax – 1,078
P
rofit/(loss) from discontinued operations, net of income tax (7) 707
Net profit after tax attributable to Shareholders of the Company 22,713 7,699
Basic & diluted earnings per share (EPS)
2021 2020*
NOTE $ $
Basic & diluted EPS on issued ordinary shares at the end of the period 9, 28(E) 0.301 0.102
Basic & diluted EPS on issued ordinary shares at the end of the period – continuing operations 9, 28(E) 0.301 0.092
Basic & diluted EPS on a weighted average basis
9

0.301

0.049
Basic & dilut
ed EPS on a weighted average basis – continuing operations
9

0.301

0.044
*
Refer to Note 29 for further details on the restatement of the comparative figures.
The accompanying notes form an integral part of these consolidated financial statements.

KEY FINANCIAL DISCLOSURES
2 | PGG WRIGHTSON LIMITED
PGG WRIGHTSON LIMITED
CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME
For the year ended 30 June 2021
2021 2020*

N
OTE

$000 $000
Net profit after tax attributable to Shareholders of the Company 22,713 7,699
Other comprehensive income/(loss)
Continuing operations
Items that will never be reclassified to profit or loss
Changes in fair value of equity instruments

136

–
R
emeasurements of defined benefit asset/liability
19

9,620

(3,942)
T
ax on remeasurements of defined benefit asset/liability 8 (2,694) 1,104
Total other comprehensive income/(loss) for the period 7,062 (2,838)
Total comprehensive income for the period attributable to Shareholders of the Company 29,775 4,861
* Refer to Note 29 for further details on the restatement of the comparative figures.
The accompanying notes form an integral part of these consolidated financial statements.

PGG WRIGHTSON LIMITED | 3
PGG WRIGHTSON LIMITED
SEGMENT REPORT
For the year ended / as at 30 June 2021
A. Operating segments
The Group has two primary operating segments, Agency and Retail
& Water, which are the Group's strategic divisions. These operating
segments operate within New Zealand.
The two operating segments offer different products and services,
and are managed separately because they require different skills,
technology and marketing strategies. Within each segment, further
business unit analysis may be provided to management where there
are significant differences in the nature of activities. The Chief Executive
Officer or Chairman of the Board reviews internal management reports
on each strategic business unit on at least a monthly basis.
The Group's segments are described below:
–

A
gency: This segment derives its revenue primarily from
commissions in respect of rural Livestock, Wool and Real Estate
transactions. This segment also derives revenue from wool and
velvet product sales, and interest revenue from its Go receivables
(refer to Note 13 Go Receivables for further explanation regarding
this programme).
– Retail & Water: This segment includes the Rural Supplies and
Fruitfed Supplies retail operations, Agritrade, PGG Wrightson
Water, PGW Consulting, ancillary sales support and supply chain
functions. This segment derives its revenue primarily from the
sale of goods as well as the design, installation and servicing of
irrigation solutions.
–
Other: Other relates to certain Group Corporate activities
including Governance, Finance, Treasury, Risk and Assurance, and
other support services (such as corporate property services and
marketing) and includes consolidation/elimination adjustments.
The Marketing function derives sales revenue from its rewards and
on-charging programmes.
–
Discontinued operations: Relate to PGG Wrightson Seeds
Holdings Limited together with its subsidiaries and investments
in jointly controlled entities (formerly the Seed & Grain segment)
which was sold in May 2019; PGW Rural Capital Limited which was
established to hold and recover certain excluded loans related to
the sale of the Group's finance subsidiary, PGG Wrightson Finance
Limited; and the Standardbred business (previously included
within Agency) which was closed in January 2020.
Assets and liabilities allocated to each business unit combine to form
total assets and liabilities for the Agency and Retail & Water business
segments. Certain other assets and liabilities are held at a Corporate
level including those for the Corporate functions noted above. Similarly,
the profit/loss for each business unit combines to form total profit/
loss of the Agency and Retail & Water business segments. Certain other
revenues and expenses are recorded at the Corporate level for the
Corporate functions noted above.
Corporate costs allocation
The Group allocates certain corporate costs to an operating segment
where they can be directly attributed to that segment or using the
following methods:
–
IT hardware, support, licence and other costs are allocated on a per
user basis.
–
Property costs which are not directly attributable are allocated on a
property space utilisation basis.
– Business operations costs (Accounts Payable, Accounts Receivable,
Call Centre) are allocated based on FTE usage by each operating
segment or transactional volumes. Credit Services costs are
allocated to the operating segment to which the overdue
accounts
relate.
Other costs such as non-operating gains/losses, impairment and fair
value gains/losses, net interest and finance costs, income tax expense
and the results of discontinued operations are not fully allocated by the
Group across the operating segments. The Group Governance, Finance,
Treasury, and Risk and Assurance functions continue to be reported
outside of the operating segments.
B.

G
eographical segment
The Group operates within New Zealand only and its revenue is derived
primarily from New Zealand.

KEY FINANCIAL DISCLOSURES
4 | PGG WRIGHTSON LIMITEDPGG WRIGHTSON LIMITED | 5
PGG WRIGHTSON LIMITED
SEGMENT REPORT CONTINUED
For the year ended / as at 30 June 2021
C. Operating segment information
AGENCY RETAIL & WATER OTHER DISCONTINUED OPERATIONS TOTA L
2021 2020* 2021 2020* 2021 2020* 2021 2020* 2021 2020*
$000 $000 $000 $000 $000 $000 $000 $000 $000 $000
Sales revenue 74,022 71,699 638,622 604,345 2,250 2,186 – – 714,894 678,230
Commission revenue 107,685 88,770 79 97 58 112 – – 107,822 88,979
Construction contract revenue – – 18,950 13,640 – – – – 18,950 13,640
Interest revenue on Go receivables 3,805 4,258 – – – – – – 3,805 4,258
Debtor interest charges 615 659 848 962 (24) 159 – – 1,439 1,780
Sublease income 356 455 118 64 431 630 – – 905 1,149
Total external operating revenues 186,483 165,841 658,617 619,108 2,715 3,087 – – 847,815 788,036
Operating EBITDA 25,179 15,681 37,533 33,228 (6,683) (6,713) – – 56,029 42,196
Non–operating gains/(losses) 3,885 78 991 31 (420) 23 – – 4,456 132
Impairment and fair value gains/(losses) 917 243 589 (1,425) 326 375 – – 1,832 (807)
Depreciation and amortisation expense (8,457) (8,882) (15,060) (15,250) (3,766) (2,535) – – (27,283) (26,667)
EBIT 21,524 7,120 24,053 16,584 (10,543) (8,850) – – 35,034 14,854
Net interest and finance costs (2,418) (1,672) (2,073) (3,062) (1,130) (298) – – (5,621) (5,032)
Profit/(loss) from continuing operations before income tax 19,106 5,448 21,980 13,522 (11,673) (9,148) – – 29,413 9,822
Income tax benefit/(expense) (3,976) (1,686) (6,360) (3,652) 3,643 2,507 – – (6,693) (2,831)
Profit/(loss) from continuing operations, net of income tax 15,130 3,762 15,620 9,870 (8,030) (6,640) – – 22,720 6,992
Profit/(loss) from discontinued operations, net of income tax – – – – – – (7) 707 (7) 707
Net profit/(loss) after tax 15,130 3,762 15,620 9,870 (8,030) (6,640) (7) 707 22,713 7,699
Segment assets 184,177 184,714 245,131 238,486 23,681 32,617 5 – 452,994 455,817
Assets held for sale – – 40 40 – – – – 40 40
Total segment assets 184,177 184,714 245,171 238,526 23,681 32,617 5 – 453,034 455,857
Total segment liabilities (101,147) (87,481) (155,907) (145,907) (22,442) (69,344) – (18) (279,496) (302,750)
Capital expenditure (additions to non–current assets) 6,940 5,571 12,468 14,574 1,677 8,358 – – 21,085 28,502
D. Impact of NZ IFRS 16 Leases
The below non-GAAP disclosures are included to facilitate comparisons with reporting periods prior to the introduction of NZ IFRS 16
(being the reporting periods prior to 1 July 2019).

AGENCY RETAIL & WATER OTHER DISCONTINUED OPERATIONS TOTA L
2021 2020* 2021 2020* 2021 2020* 2021 2020* 2021 2020*
$000 $000 $000 $000 $000 $000 $000 $000 $000 $000
Operating EBITDA including NZ IFRS 16 25,179 15,681 37,533 33,228 (6,683) (6,713) – – 56,029 42,196
Less NZ IFRS16 adjustments:
Other operating expenses (7,196) (7,300) (13,280) (12,773) (1,246) (1,671) – – (21,722) (21,744)
Operating EBITDA excluding NZ IFRS 16 17,983 8,381 24,253 20,455 (7,929) (8,384) – – 34,307 20,452
* Refer to Note 29 for further details on the restatement of the comparative figures.
The accompanying notes form an integral part of these consolidated financial statements.
KEY FINANCIAL DISCLOSURES
4 | PGG WRIGHTSON LIMITEDPGG WRIGHTSON LIMITED | 5
PGG WRIGHTSON LIMITED
SEGMENT REPORT CONTINUED
For the year ended / as at 30 June 2021
C. Operating segment information
AGENCY RETAIL & WATER OTHER DISCONTINUED OPERATIONS TOTA L
2021 2020* 2021 2020* 2021 2020* 2021 2020* 2021 2020*
$000 $000 $000 $000 $000 $000 $000 $000 $000 $000
Sales revenue 74,022 71,699 638,622 604,345 2,250 2,186 – – 714,894 678,230
Commission revenue 107,685 88,770 79 97 58 112 – – 107,822 88,979
Construction contract revenue – – 18,950 13,640 – – – – 18,950 13,640
Interest revenue on Go receivables 3,805 4,258 – – – – – – 3,805 4,258
Debtor interest charges 615 659 848 962 (24) 159 – – 1,439 1,780
Sublease income 356 455 118 64 431 630 – – 905 1,149
Total external operating revenues 186,483 165,841 658,617 619,108 2,715 3,087 – – 847,815 788,036
Operating EBITDA 25,179 15,681 37,533 33,228 (6,683) (6,713) – – 56,029 42,196
Non–operating gains/(losses) 3,885 78 991 31 (420) 23 – – 4,456 132
Impairment and fair value gains/(losses) 917 243 589 (1,425) 326 375 – – 1,832 (807)
Depreciation and amortisation expense (8,457) (8,882) (15,060) (15,250) (3,766) (2,535) – – (27,283) (26,667)
EBIT 21,524 7,120 24,053 16,584 (10,543) (8,850) – – 35,034 14,854
Net interest and finance costs (2,418) (1,672) (2,073) (3,062) (1,130) (298) – – (5,621) (5,032)
Profit/(loss) from continuing operations before income tax 19,106 5,448 21,980 13,522 (11,673) (9,148) – – 29,413 9,822
Income tax benefit/(expense) (3,976) (1,686) (6,360) (3,652) 3,643 2,507 – – (6,693) (2,831)
Profit/(loss) from continuing operations, net of income tax 15,130 3,762 15,620 9,870
(8,030) (6,640) – – 22,720 6,992
Profit/(loss) from discontinued operations, net of income tax – – – – – – (7) 707 (7) 707
Net profit/(loss) after tax 15,130 3,762 15,620 9,870 (8,030) (6,640) (7) 707 22,713 7,699
Segment assets 184,177 184,714 245,131 238,486 23,681 32,617 5 – 452,994 455,817
Assets held for sale – – 40 40 – – – – 40 40
Total segment assets 184,177 184,714 245,171 238,526 23,681 32,617 5 – 453,034 455,857
Total segment liabilities (101,147) (87,481) (155,907) (145,907) (22,442) (69,344) – (18) (279,496) (302,750)
Capital expenditure (additions to non–current assets) 6,940 5,571 12,468 14,574 1,677 8,358 – – 21,085 28,502
D. Impact of NZ IFRS 16 Leases
The below non-GAAP disclosures are included to facilitate comparisons with reporting periods prior to the introduction of NZ IFRS 16
(being the reporting periods prior to 1 July 2019).
AGENCY RETAIL & WATER OTHER DISCONTINUED OPERATIONS TOTA L
2021 2020* 2021 2020* 2021 2020* 2021 2020* 2021 2020*
$000 $000 $000 $000 $000 $000 $000 $000 $000 $000
Operating EBITDA including NZ IFRS 16 25,179 15,681 37,533 33,228 (6,683) (6,713) – – 56,029 42,196
Less NZ IFRS16 adjustments:
Other operating expenses (7,196) (7,300) (13,280) (12,773) (1,246) (1,671) – – (21,722) (21,744)
Operating EBITDA excluding NZ IFRS 16 17,983 8,381 24,253 20,455 (7,929) (8,384) – – 34,307 20,452
* Refer to Note 29 for further details on the restatement of the comparative figures.
The accompanying notes form an integral part of these consolidated financial statements.
KEY FINANCIAL DISCLOSURES
4 | PGG WRIGHTSON LIMITEDPGG WRIGHTSON LIMITED | 5
PGG WRIGHTSON LIMITED
SEGMENT REPORT CONTINUED
For the year ended / as at 30 June 2021
C. Operating segment information
AGENCY RETAIL & WATER OTHER DISCONTINUED OPERATIONS TOTA L
2021 2020* 2021 2020* 2021 2020* 2021 2020* 2021 2020*
$000 $000 $000 $000 $000 $000 $000 $000 $000 $000
Sales revenue 74,022 71,699 638,622 604,345 2,250 2,186 – – 714,894 678,230
Commission revenue 107,685 88,770 79 97 58 112 – – 107,822 88,979
Construction contract revenue – – 18,950 13,640 – – – – 18,950 13,640
Interest revenue on Go receivables 3,805 4,258 – – – – – – 3,805 4,258
Debtor interest charges 615 659 848 962 (24) 159 – – 1,439 1,780
Sublease income 356 455 118 64 431 630 – – 905 1,149
Total external operating revenues 186,483 165,841 658,617 619,108 2,715 3,087 – – 847,815 788,036
Operating EBITDA 25,179 15,681 37,533 33,228 (6,683) (6,713) – – 56,029 42,196
Non–operating gains/(losses) 3,885 78 991 31 (420) 23 – – 4,456 132
Impairment and fair value gains/(losses) 917 243 589 (1,425) 326 375 – – 1,832 (807)
Depreciation and amortisation expense (8,457) (8,882) (15,060) (15,250) (3,766) (2,535) – – (27,283) (26,667)
EBIT 21,524 7,120 24,053 16,584 (10,543) (8,850) – – 35,034 14,854
Net interest and finance costs (2,418) (1,672) (2,073) (3,062) (1,130) (298) – – (5,621) (5,032)
Profit/(loss) from continuing operations before income tax 19,106 5,448 21,980 13,522 (11,673) (9,148) – – 29,413 9,822
Income tax benefit/(expense) (3,976) (1,686) (6,360) (3,652) 3,643 2,507 – – (6,693) (2,831)
Profit/(loss) from continuing operations, net of income tax 15,130 3,762 15,620 9,870 (8,030) (6,640) – – 22,720 6,992
Profit/(loss) from discontinued operations, net of income tax – – – – – – (7) 707 (7) 707
Net profit/(loss) after tax 15,130 3,762 15,620 9,870 (8,030) (6,640) (7) 707 22,713 7,699
Segment assets 184,177 184,714 245,131 238,486 23,681 32,617 5 – 452,994 455,817
Assets held for sale – – 40 40 – – – – 40 40
Total segment assets 184,177 184,714 245,171 238,526 23,681 32,617 5 – 453,034 455,857
Total segment liabilities (101,147) (87,481) (155,907) (145,907) (22,442) (69,344) – (18) (279,496) (302,750)
Capital expenditure (additions to non–current assets) 6,940 5,571 12,468 14,574 1,677 8,358 – – 21,085 28,502
D. Impact of NZ IFRS 16 Leases
The below non-GAAP disclosures are included to facilitate comparisons with reporting periods prior to the introduction of NZ IFRS 16
(being the reporting periods prior to 1 July 2019).
AGENCY RETAIL & WATER OTHER DISCONTINUED OPERATIONS TOTA L
2021 2020* 2021 2020* 2021 2020* 2021 2020* 2021 2020*
$000 $000 $000 $000 $000 $000 $000 $000 $000 $000
Operating EBITDA including NZ IFRS 16 25,179 15,681 37,533 33,228 (6,683) (6,713) – – 56,029 42,196
Less NZ IFRS16 adjustments:
Other operating expenses (7,196) (7,300) (13,280) (12,773) (1,246) (1,671) – – (21,722) (21,744)
Operating EBITDA excluding NZ IFRS 16 17,983 8,381 24,253 20,455 (7,929) (8,384) – – 34,307 20,452
* Refer to Note 29 for further details on the restatement of the comparative figures.
The accompanying notes form an integral part of these consolidated financial statements.
KEY FINANCIAL DISCLOSURES
4 | PGG WRIGHTSON LIMITEDPGG WRIGHTSON LIMITED | 5
PGG WRIGHTSON LIMITED
SEGMENT REPORT CONTINUED
For the year ended / as at 30 June 2021
C. Operating segment information
AGENCY RETAIL & WATER OTHER DISCONTINUED OPERATIONS TOTA L
2021 2020* 2021 2020* 2021 2020* 2021 2020* 2021 2020*
$000 $000 $000 $000 $000 $000 $000 $000 $000 $000
Sales revenue 74,022 71,699 638,622 604,345 2,250 2,186 – – 714,894 678,230
Commission revenue 107,685 88,770 79 97 58 112 – – 107,822 88,979
Construction contract revenue – – 18,950 13,640 – – – – 18,950 13,640
Interest revenue on Go receivables 3,805 4,258 – – – – – – 3,805 4,258
Debtor interest charges 615 659 848 962 (24) 159 – – 1,439 1,780
Sublease income 356 455 118 64 431 630 – – 905 1,149
Total external operating revenues 186,483 165,841 658,617 619,108 2,715 3,087 – – 847,815 788,036
Operating EBITDA 25,179 15,681 37,533 33,228 (6,683) (6,713) – – 56,029 42,196
Non–operating gains/(losses) 3,885 78 991 31 (420) 23 – – 4,456 132
Impairment and fair value gains/(losses) 917 243 589 (1,425) 326 375 – – 1,832 (807)
Depreciation and amortisation expense (8,457) (8,882) (15,060) (15,250) (3,766) (2,535) – – (27,283) (26,667)
EBIT 21,524 7,120 24,053 16,584 (10,543) (8,850) – – 35,034 14,854
Net interest and finance costs (2,418) (1,672) (2,073) (3,062) (1,130) (298) – – (5,621) (5,032)
Profit/(loss) from continuing operations before income tax 19,106 5,448 21,980 13,522 (11,673) (9,148) – – 29,413 9,822
Income tax benefit/(expense) (3,976) (1,686) (6,360) (3,652) 3,643 2,507 – – (6,693) (2,831)
P
rofit/(loss) from continuing operations, net of income tax 15,130 3,762 15,620 9,870 (8,030) (6,640) – – 22,720 6,992
Profit/(loss) from discontinued operations, net of income tax – – – – – – (7) 707 (7) 707
Net profit/(loss) after tax 15,130 3,762 15,620 9,870 (8,030) (6,640) (7) 707 22,713 7,699
Segment assets 184,177 184,714 245,131 238,486 23,681 32,617 5 – 452,994 455,817
Assets held for sale – – 40 40 – – – – 40 40
Total segment assets 184,177 184,714 245,171 238,526 23,681 32,617 5 – 453,034 455,857
Total segment liabilities (101,147) (87,481) (155,907) (145,907) (22,442) (69,344) – (18) (279,496) (302,750)
Capital expenditure (additions to non–current assets) 6,940 5,571 12,468 14,574 1,677 8,358 – – 21,085 28,502
D. Impact of NZ IFRS 16 Leases
The below non-GAAP disclosures are included to facilitate comparisons with reporting periods prior to the introduction of NZ IFRS 16
(being the reporting periods prior to 1 July 2019).
AGENCY RETAIL & WATER OTHER DISCONTINUED OPERATIONS TOTA L
2021 2020* 2021 2020* 2021 2020* 2021 2020* 2021 2020*
$000 $000 $000 $000 $000 $000 $000 $000 $000 $000
Operating EBITDA including NZ IFRS 16 25,179 15,681 37,533 33,228 (6,683) (6,713) – – 56,029 42,196
Less NZ IFRS16 adjustments:
Other operating expenses (7,196) (7,300) (13,280) (12,773) (1,246) (1,671) – – (21,722) (21,744)
Operating EBITDA excluding NZ IFRS 16 17,983 8,381 24,253 20,455 (7,929) (8,384) – – 34,307 20,452
* Refer to Note 29 for further details on the restatement of the comparative figures.
The accompanying notes form an integral part of these consolidated financial statements.
KEY FINANCIAL DISCLOSURES
4 | PGG WRIGHTSON LIMITEDPGG WRIGHTSON LIMITED | 5
PGG WRIGHTSON LIMITED
SEGMENT REPORT CONTINUED
For the year ended / as at 30 June 2021
C. Operating segment information
AGENCY RETAIL & WATER OTHER DISCONTINUED OPERATIONS TOTA L
2021 2020* 2021 2020* 2021 2020* 2021 2020* 2021 2020*
$000 $000 $000 $000 $000 $000 $000 $000 $000 $000
Sales revenue 74,022 71,699 638,622 604,345 2,250 2,186 – – 714,894 678,230
Commission revenue 107,685 88,770 79 97 58 112 – – 107,822 88,979
Construction contract revenue – – 18,950 13,640 – – – – 18,950 13,640
Interest revenue on Go receivables 3,805 4,258 – – – – – – 3,805 4,258
Debtor interest charges 615 659 848 962 (24) 159 – – 1,439 1,780
Sublease income 356 455 118 64 431 630 – – 905 1,149
Total external operating revenues 186,483 165,841 658,617 619,108 2,715 3,087 – – 847,815 788,036
Operating EBITDA 25,179 15,681 37,533 33,228 (6,683) (6,713) – – 56,029 42,196
Non–operating gains/(losses) 3,885 78 991 31 (420) 23 – – 4,456 132
Impairment and fair value gains/(losses) 917 243 589 (1,425) 326 375 – – 1,832 (807)
Depreciation and amortisation expense (8,457) (8,882) (15,060) (15,250) (3,766) (2,535) – – (27,283) (26,667)
EBIT 21,524 7,120 24,053 16,584 (10,543) (8,850) – – 35,034 14,854
Net interest and finance costs (2,418) (1,672) (2,073) (3,062) (1,130) (298) – – (5,621) (5,032)
Profit/(loss) from continuing operations before income tax 19,106 5,448 21,980 13,522 (11,673) (9,148) – – 29,413 9,822
Income tax benefit/(expense) (3,976) (1,686) (6,360) (3,652) 3,643 2,507 – – (6,693) (2,831)
P
rofit/(loss) from continuing operations, net of income tax 15,130 3,762 15,620 9,870 (8,030) (6,640) – – 22,720 6,992
Profit/(loss) from discontinued operations, net of income tax – – – – – – (7) 707 (7) 707
Net profit/(loss) after tax 15,130 3,762 15,620 9,870 (8,030) (6,640) (7) 707 22,713 7,699
Segment assets 184,177 184,714 245,131 238,486 23,681 32,617 5 – 452,994 455,817
Assets held for sale – – 40 40 – – – – 40 40
Total segment assets 184,177 184,714 245,171 238,526 23,681 32,617 5 – 453,034 455,857
Total segment liabilities (101,147) (87,481) (155,907) (145,907) (22,442) (69,344) – (18) (279,496) (302,750)
Capital expenditure (additions to non–current assets) 6,940 5,571 12,468 14,574 1,677 8,358 – – 21,085 28,502
D. Impact of NZ IFRS 16 Leases
The below non-GAAP disclosures are included to facilitate comparisons with reporting periods prior to the introduction of NZ IFRS 16
(being the reporting periods prior to 1 July 2019).
AGENCY RETAIL & WATER OTHER DISCONTINUED OPERATIONS TOTA L
2021 2020* 2021 2020* 2021 2020* 2021 2020* 2021 2020*
$000 $000 $000 $000 $000 $000 $000 $000 $000 $000
Operating EBITDA including NZ IFRS 16 25,179 15,681 37,533 33,228 (6,683) (6,713) – – 56,029 42,196
Less NZ IFRS16 adjustments:
Other operating expenses (7,196) (7,300) (13,280) (12,773) (1,246) (1,671) – – (21,722) (21,744)
Operating EBITDA excluding NZ IFRS 16 17,983 8,381 24,253 20,455 (7,929) (8,384) – – 34,307 20,452
* Refer to Note 29 for further details on the restatement of the comparative figures.
The accompanying notes form an integral part of these consolidated financial statements.

KEY FINANCIAL DISCLOSURES
6 | PGG WRIGHTSON LIMITED
PGG WRIGHTSON LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 30 June 2021
2021 2020*
$000 $000
Cash flows from operating activities
Cash was provided from:
Receipts from customers

818,914

809,733
R
eceipt for the termination of partnering contract, net of costs
3,934

–
Dividends r
eceived 1 17
Interest received 5,307 6,622
828,156

816,372
C
ash was applied to:
Payments to suppliers and employees (765,212) (774,842)
Interest paid (646) (923)
Interest paid on lease liabilities (4,036) (4,185)
I
ncome tax paid
(28)

(4,968)
L
ump sum contributions to defined benefit plans (ESCT inclusive) (563) –
(770,485) (784,918)
Net cash inflow/(outflow) from operating activities 57,671 31,454
Cash flows from investing activities
Cash was provided from:
Proceeds from sale of property, plant and equipment and assets held for sale
3,294 855
Proceeds from sale of investments
136

–
3,430 855
C
ash was applied to:
Purchase of property, plant and equipment (5,500) (5,419)
Purchase of intangibles
(1,309)

(3,683)
Investment sale costs (51) –
(6,860) (9,102)
Net cash inflow/(outflow) from investing activities (3,430) (8,247)
Cash flows from financing activities
Cash was provided from:
Increase in external borrowings and bank overdraft
– 47,320
–

47,320
Cash was applied to:
Share repurchase and cancellation
–

(234,000)
Dividends paid t
o shareholders (9,343) (12,564)
Repayment of external borrowings and bank overdraft (40,100) –
Repayment of principal portion of lease liabilities (18,299) (17,586)
(67,742) (264,150)
Net cash inflow/(outflow) from financing activities (67,742) (216,830)
Net increase/(decrease) in cash held (13,501) (193,623)
Opening cash 16,868 210,491
Cash and cash equivalents 10 3,367 16,868
* Refer to Note 29 for further details on the restatement of the comparative figures.
The accompanying notes form an integral part of these consolidated financial statements.

PGG WRIGHTSON LIMITED | 7
PGG WRIGHTSON LIMITED
RECONCILIATION OF PROFIT AFTER TAX
WITH NET CASH FLOW FROM OPERATING ACTIVITIES
For the year ended 30 June 2021
2021 2020*
$000 $000
Net profit after tax 22,713 7,699
Add/(deduct) non-cash/non-operating items:
Depreciation and amortisation

27,283

26,706
I
mpairment and fair value losses/(gains)
(1,832)

807
R
eversal of software capital projects expensed in the current period 750 –
Bad debts written off (net) 67 489
L
oss/(profit) on sale of assets and investments, and lease terminations
(909)

(1,259)
F
oreign exchange loss/(gain)
333

135
D
eferred tax expense/(benefit) (258) 787
Defined benefit expense/(gain) 35 13
Pension contributions not expensed through profit or loss (563) –
O
ther non-cash/non-operating items
83

(284)
A
dd/(deduct) movement in working capital items:
Change in inventories

759

(915)
Change in accounts receivable and prepayments (22,694) 22,825
Change in trade cr
editors, provisions and accruals
26,468

(22,222)
Change in income tax payable/receivable
6,917

(3,716)
Change in other current assets/liabilities (1,481) 389
Net cash flow from operating activities 57,671 31,454
Cash Flows Accounting Policies
In the statement of cash flows, cash receipts and payments on behalf of customers which reflect the activities of the customers rather than
those of the Group are reported on a net basis.
*
Refer to Note 29 for fur
ther details on the restatement of the comparative figures.
The accompanying notes form an integral part of these consolidated financial statements.

KEY FINANCIAL DISCLOSURES
8 | PGG WRIGHTSON LIMITED
PGG WRIGHTSON LIMITED
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2021
2021 2020* 2019*
NOTE $000 $000 $000
ASSETS
Current
Cash and cash equivalents
10 3,367 16,868 210,491
Short–term derivative assets
11

843

707

614
T
rade and other receivables 12 148,171 122,946 145,881
Go receivables
13

45,869

48,111

47,754
I
ncome tax receivable – 3,399 125
Inventories
14

81,498

83,431

82,485
A
ssets classified as held for sale 40 40 2,326
O
ther current assets
2,842

2,059

2,257
T
otal current assets 282,630 277,561 491,933
Non–current
Long–term derivative assets 11 – 235 387
Deferred tax asset
8

8,173

10,660

10,344
I
nvestments in equity accounted investees
92

79

71
Other investments
474

471

470
I
ntangible assets 15 15,663 15,866 13,331
R
ight-of-use assets
16

101,064

104,625

–
P
roperty, plant and equipment 17 44,627 46,330 44,702
Defined benefit asset
19

311

–

–
O
ther non-current assets – 29 12
Total non-current assets
170,404

178,296

69,317
T
otal assets 453,034 455,857 561,250
LIABILITIES
C
urrent
Debt due within one year
10

9,900

30,000

2,680
Shor
t-term derivative liabilities 11 242 562 280
A
ccounts payable and accruals
18

158,883

132,600

155,903
Shor
t-term lease liabilities 16 17,631 16,506 –
I
ncome tax payable
3,466

–

–
T
otal current liabilities 190,122 179,668 158,863
Non–current
Long-term debt
10 – 20,000 –
L
ong-term derivative liabilities
11

143

45

62
L
ong-term lease liabilities 16 86,387 90,398 –
L
ong-term provisions
18

2,844

2,802

1,631
D
efined benefit liability
19

–

9,838

5,883
Total non-current liabilities
89,374

123,083

7,576
T
otal liabilities
279,496

302,750

166,439
EQUITY
Share capital

30

372,318

372,318

606,318
R
eserves
30

14,782

7,586

10,424
R
etained earnings/(deficit)
30

(213,562)

(226,798)

(221,931)
T
otal equity attributable to Shareholders of the Company
173,538

153,106

394,811
T
otal liabilities and equity
453,034

455,857

561,250
*

Refer to Note 29 for fur
ther details on the restatement of the comparative figures.
The accompanying notes form an integral part of these consolidated financial statements.

PGG WRIGHTSON LIMITED | 9
ADDITIONAL
FINANCIAL
DISCL
OSURES
INCLUDING NOTES TO
THE CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2021
$
PGG Wrightson Livestock
Representatives – Genetics, Cam Heggie
and Emma Pollitt, review the sales
catalogue at the Rangatira Angus Mixed
Age Cow and Calf Dispersal sale near
Gisborne in Poverty Bay in March 2021.

10 | PGG WRIGHTSON LIMITED
PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
1 OPERATING REVENUE
2021 2020
$000

$000
Revenue from contracts with customers
Sales revenue
714,894

678,230
Commission revenue 107,822 88,979
Construction contract revenue 18,950 13,640
Other operating revenue
Interest revenue on Go receivables
3,805

4,258
Debtor interest charges 1,439 1,780
Sublease income 905 1,149
847,815 788,036
Income Recognition Accounting Policies
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably
measured. The following specific recognition criteria must also be met before revenue is recognised.
Sales revenue
Sales revenue comprises the sale value of transactions where the Group acts as a principal; for example, retail store sales, and sales of wool
and velvet products. Revenue is measured at the transaction price when control is transferred to which an entity expects to be entitled
in exchange for transferring goods or services to a customer. For sale of goods, the transfer of control occurs when the risks and rewards,
physical possession and the legal title of the goods have been transferred and accepted by the customer and the customer has a present
obligation to make the payment.
Our customers may be entitled to discounts or rebates for certain items and/or volumes purchased, under varying categories. These
discounts or rebates are defined as variable consideration and are included in the transaction price as a component of operating revenue
upon the completion of our performance obligations. These discounts/rebates are contractual in nature and known at balance date,
therefore no assumptions or estimates are required.
The Group offers a range of payment terms, and in some cases can be up to 12 months. The Group does not recognise a financing element
for contracts with terms of 12 months or less.
When part of the Group's performance obligation in selling its products is to arrange freight and/or insurance, the Group is considered to
be acting as an agent and these costs are recognised net against freight recoveries.
The Group offers warranties as required by New Zealand law and/or per the terms and conditions of the contracts with customers. The
Group recognises the obligations under these warranties as a provision.
Commission revenue
Commission revenue comprises commission for transactions where the Group acts as an agent. For agency commissions, the Group
does not take inventory risk or title for inventories, or for the Group's Livestock and Real Estate businesses, biological assets and properties
respectively. The Group generates commissions from acting as an agent for organising the sale of livestock or real estate, and from the
successful referral of clients to unrelated lending and insurance partners.
Revenue is recognised at a point in time upon completion of service.
Construction contract revenue
Construction services are provided to customers in the Water business to construct pivots and irrigation systems. Most contracts contain a
single performance obligation. The size and duration of the contracts can vary significantly, and customers are invoiced as work progresses.
Most contracts are completed within 12 months; therefore, the unearned revenue on these contracts has not been disclosed.
The Group accounts for revenue over time, which best depicts the pattern of transfer of the construction services to the customer. The
Group uses an input method to recognise revenue based on a percentage of cost completed. This method involves judgements relating to
a contract's expected margin and its stage of completion.
Interest and similar income and expense
The Group recognises the fixed fees charged to customers under its Go programme as interest revenue. Refer to Note 13 Go Receivables for
further explanation regarding this programme. This interest revenue is recognised over the term of the Go contracts.
The Group also recognises interest revenue on an accruals basis when the services are rendered using the effective interest method. Refer
to the accounting policies under Note 6 Net Interest and Finance Costs for further explanation on the effective interest method.
Sublease income
The Group recognises lease payments received under subleases as income on a straight-line basis over the lease term. Refer to Note 16
Right-of-Use Assets and Lease Liabilities for further explanation.

PGG WRIGHTSON LIMITED | 11
PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2021
2 COST OF SALES
2021 2020

N
OTE

$000 $000
Depreciation and amortisation 187 181
Employee benefits (including commissions)
34,245

23,953
Inventories and consumables 14 557,079 534,561
Other 33,078 25,355
624,589 584,050
3 OTHER OPERATING EXPENSES
2021 2020
$000 $000
Audit of annual financial statements of the Company by EY 240 –
Audit of annual financial statements of the Company by KPMG
–

190
Regulatory and other assurance services provided by KPMG – 11
Dir
ectors' fees 552 611
D
onations
8

1
I
ncrease/(decrease) in provision for impaired debtors and contract assets
(774)

343
Net bad debts wr
itten off
841

147
IT & t
elecommunication costs 12,981 14,440
M
arketing
3,820

3,818
M
otor vehicle costs
5,713

5,804
T
ravel costs
2,858

3,044
R
ental and operating lease costs 460 279
O
ccupancy costs (excluding rental and operating lease)
5,110

5,542
O
ther staff costs
6,104

6,558
O
ther expenses
9,822

7,338
47,735 48,126
4 NON-OPERATING GAINS/(LOSSES)
2021 2020
$000 $000
Receipt for the termination of partnering contract, net of costs 3,934 –
Gain/(loss) on sale of property, plant and equipment
960

151
O
ther non-operating gains/(losses)
(438)

(19)
4,456 132

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
5 IMPAIRMENT AND FAIR VALUE GAINS/(LOSSES)
2021 2020

N
OTE

$000 $000
Net impairment reversal/(impairment) - Property, plant and equipment 5(A) 906 253
Net impairment reversal/(impairment) - Right-of-use assets
5(B)

910

(852)
Fair value gains/(losses) - Assets held for sale – (198)
Other fair value gains/(losses) 16 (10)
1,832 (807)
A. Saleyards
A
t balance date, the Group reviewed its saleyard assets for indicators of impairment and for any indication that a previously recognised impairment
loss may have decreased. The Group reversed $0.91 million of previously recognised impairment losses on 10 saleyards. This was based off
indicative external market valuations for the saleyards.
B.
R
ight-of-use assets
At balance date, the Group reviewed its right-of-use assets for indicators of impairment and for any indication that a previously recognised
impairment loss may have decreased. As a result of this review, the Group reversed $0.91 million of previously recognised impairment losses. Most
of the impairment reversal relates to the Water business. The impairment reversal resulted from changes in key assumptions applied to the value
in use model used for impairment testing. The change in assumptions included improved current and estimated future earnings following a
restructure of the business and the sublease of surplus space related to a previously impaired right-of-use asset.
Impairment Accounting Policies
The carrying value of the Group's assets are reviewed at each reporting date to determine whether there is any objective evidence of
impairment. An impairment loss is recognised whenever the carrying amount exceeds its recoverable amount. Impairment losses directly
reduce the carrying value of assets and are recognised in profit or loss unless the asset is carried at a revalued amount in accordance with
another standard.
Non-financial assets
The carrying amounts of the Group's non-financial assets (other than biological assets, inventories and deferred tax assets) are reviewed at
each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the recoverable amount
of the asset or the cash-generating unit (CGU) to which the asset relates is estimated. A CGU is the smallest identifiable asset group that
generates cash flows that are largely independent from other assets and groups.
The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. Value in use is based on the
estimated future cash flows, discounted to their present value using a pre-tax discount rate that reflects current market assessments of the
time value of money and the risks specific to the asset or CGU.
An impairment loss is recognised if the carrying amount of an asset or CGU exceeds its recoverable amount. Impairment losses are
recognised in profit or loss.
An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have
been determined, net of depreciation or amortisation, if no impairment loss had been recognised.
12 | PGG WRIGHTSON LIMITED

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
6 NET INTEREST AND FINANCE COSTS
2021 2020
$000 $000
Interest income 63 579
Interest funding expense
Bank interest on loans and overdrafts
(646) (923)
Bank facility fees (908) (683)
(1,554) (1,606)
Net interest income/(expense) excluding interest on lease liabilities
(1,491)

(1,027)
I
nterest on lease liabilities
(4,036)

(4,183)
F
oreign exchange gain/(loss)
Net gain/(loss) on foreign denominated items
(217) 502
Fair value gain/(loss) on foreign exchange derivatives 123 (324)
(94)

178
Net interest and finance income/(expense) (5,621) (5,032)
Interest and Finance Income/Expense Accounting Policies
Interest and similar income and expense
For all financial instruments measured at amortised cost, interest income or expense is recorded at the effective interest rate, which is the
rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial instrument or a shorter
period, where appropriate, to the net carrying amount of the financial asset or financial liability. The calculation takes into account all
contractual terms of the financial instrument (for example, prepayment options) and includes any fees or incremental costs that are directly
attributable to the instrument and are an integral part of the effective interest rate, but not future credit losses. Once the recorded value of a
financial asset or a group of similar financial assets has been reduced due to an impairment loss, interest income continues to be recognised
using the original effective interest rate applied to the new carrying amount.
Fair value change on foreign exchange derivatives
The Group undertakes transactions denominated in foreign currencies and exposure to movements in foreign currency arises from these
activities. The Group uses forward and spot foreign exchange contracts to manage these exposures. These derivatives are recorded at their
fair value with mark-to-market fair value movements flowing through fair value change on foreign exchange derivatives in the profit or loss.
A portion of the underlying hedged future sale or purchase transactions have not yet been recognised by the Group. For this portion, no
corresponding offsetting net gain/(loss) on foreign denominated items has been recognised.
PGG WRIGHTSON LIMITED | 13

Refer to
Accounting
Policies
– page 16.
PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
7 GOVERNMENT GRANT
COVID-19 wage subsidy
The Group's financial performance for 2020 was significantly impacted by COVID-19. Whilst the Group's retail stores and warehouse supplies
facilities continued operating as an "essential service" during all of New Zealand's alert levels, the Group's Water, Wool, Real Estate and Livestock
saleyard businesses were closed at alert level 4 and only reopened under alert level 3 following strict protocols. Under the Government's COVID-19
wage subsidy scheme, which was aimed at supporting employers affected by the COVID-19 lockdown to continue to employ staff, the Group
received $4.09 million.
$3.15 million of this subsidy was recognised in the profit or loss (within Employee Expenses) during 2020. The remaining $0.94 million has been
recognised in the profit or loss (within Employee Expenses) during 2021. There are no unfulfilled conditions or other contingencies attached to
these grants.
The Group did not benefit directly from any other forms of government assistance during the year.
Government Grant Accounting Policies
Government grants are recognised when there is reasonable assurance that the entity will comply with the conditions attaching to them
and the grants will be received. Government grants relating to costs are recognised in profit or loss on a systematic basis over the periods in
which the entity recognises as expenses the related costs for which the grants are intended to compensate.
8 INCOME TAXES
A. Income tax recognised in profit or loss
2021 2020
$000 $000
Current tax benefit/(expense)
Current year
(7,395)

(2,146)
Adjustments for prior years 443 103
(6,952)

(2,043)
Deferred tax benefit/(expense)
Origination and reversal of temporary differences
727 (973)
Adjustments for prior years (468) 185
259

(788)
Income tax benefit/(expense) (6,693) (2,831)
Reconciliation
Profit from continuing operations before income tax 29,413 9,822
Income tax using the Company's tax rate (28%) (8,236) (2,750)
Non-deductible expenditure (478) (792)
Non-assessable income 1,784 481
Tax credits 285 109
O
ver/(under) provided in prior years
(25)

288
Other (23) (167)
Income tax benefit/(expense) (6,693) (2,831)
14 | PGG WRIGHTSON LIMITED

Refer to
Accounting
Policies
– page 16.
PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
8 INCOME TAXES (CONTINUED)
B. Income tax recognised directly in equity
2021 2020
$000 $000
Deferred tax on movement of actuarial gains/losses on employee benefit plans (2,746) 1,104
Current tax on movement of actuarial gains/losses on employee benefit plans
52

–
Income tax benefit/(expense) recognised directly in equity (2,694) 1,104
C. Recognised deferred tax assets and liabilities
Deferred tax assets and liabilities are attributable to the following:
ASSETS ASSETS LIABILITIES LIABILITIES NET NET

2021 2020 2021 2020 2021 2020
$000 $000 $000 $000 $000 $000
Property, plant and equipment 565 616 – – 565 616
Intangible assets – – (2,277) (1,181) (2,277) (1,181)
Right-of-use assets – – (28,298) (29,350) (28,298) (29,350)
Lease liabilities 29,125 29,987 – – 29,125 29,987
Emplo
yee benefits 4,762 6,361 – – 4,762 6,361
P
rovisions
4,296

4,227

–

–

4,296

4,227
Deferred tax asset/(liability) 38,748 41,191 (30,575) (30,531) 8,173 10,660
RECOGNISED IN RECOGNISED IN
RECOGNISED OTHER RECOGNISED OTHER
BALANCE IN PROFIT COMPREHENSIVE BALANCE IN PROFIT COMPREHENSIVE BALANCE
1 JUL 2019 OR LOSS INCOME 30 JUN 2020 OR LOSS INCOME 30 JUN 2021
$000
$000 $000 $000 $000 $000 $000
Property, plant 818 (202) – 616 (51) – 565
and equipment
Intangible assets
(391) (790) – (1,181) (1,096) – (2,277)
Right-of-use assets – (29,350) – (29,350) 1,052 – (28,298)
L
ease liabilities – 29,987 – 29,987 (862) – 29,125
Employee benefits 6,294 (1,037) 1,104 6,361 1,147 (2,746) 4,762
P
rovisions 3,623 604 – 4,227 69 – 4,296
10,344 (788) 1,104 10,660 259 (2,746) 8,173
D
.
Unr
ecognised tax losses and temporary differences
A
t 30 June 2021, the Group has no unrecognised deferred tax assets relating to tax losses and temporary differences (2020: Nil).
E.

I
mputation credits
T
he Group has $6.2 million imputation credits as at 30 June 2021 (2020: $8.8 million).
PGG WRIGHTSON LIMITED | 15

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
8 INCOME TAXES (CONTINUED)
Income Tax Accounting Policies
Income tax expense comprises current and deferred taxation and is recognised in profit or loss except to the extent that it relates to items
recognised directly in other comprehensive income or equity, in which case it is recognised directly in other comprehensive income or
equity.
Current tax
Current tax is the expected tax payable on the taxable income for the year, calculated using tax rates enacted or substantively enacted at
the reporting date. Current tax includes any adjustment to tax payable with respect to previous periods. Current tax assets and liabilities are
offset only if certain criteria are met.
Deferred tax
Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for taxation purposes. Deferred tax is measured at the tax rates that are expected to be applied to the
temporary differences when they reverse, based on the laws that have been enacted or substantially enacted at the reporting date.
Deferred tax is not recognised for:
–

taxable t
emporary differences arising on the initial recognition of goodwill;
–

t
emporary differences relating to subsidiaries, associates and jointly controlled entities to the extent that the Group is able to control the
timing of the reversal of the temporary differences and it is probable they will not reverse in the foreseeable future;
–
t
emporary differences on the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects
neither accounting nor taxable profit or loss.
A deferred tax asset is recognised to the extent that it is probable that future taxable profits will be available against which temporary
differences can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer
probable that the related tax benefit will be recognised.
Deferred tax assets and liabilities are offset only if certain criteria are met.
16 | PGG WRIGHTSON LIMITED

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
9 EARNINGS PER SHARE AND NET TANGIBLE ASSETS
A. Earnings per share (EPS)
The calculation of EPS is based on the following profit figures and number of authorised shares.
WEIGHTED AVERAGE
ISSUED ORDINAR
Y SHARES
NUMBER OF ORDINAR
Y SHARES
2021 2020 2021 2020
000 000 000 000
Issued ordinary shares at 1 July 75,484 754,839 75,484 754,839
Ordinary shares issued due to 2:1 share split
–

754,839

–

663,845
Ordinary shares repurchased and cancelled – (754,839) – (663,845)
Ordinary shares reduced due to 1:10 share consolidation – (679,355) – (597,460)
Balance at 30 June 75,484 75,484 75,484 157,379
There are no dilutive shares or options (2020: Nil).
2021 2020*
$000 $000
Profit (net of tax) attributable to Shareholders of the Company 22,713 7,699
Profit from continuing operations (net of tax) attributable to Shareholders of the Company 22,720 6,992
2021 2020*
$ $
Basic & diluted EPS on issued ordinary shares at the end of the period 0.301 0.102
Basic & diluted EPS on issued ordinary shares at the end of the period - continuing operations
0.301

0.092
Basic & diluted EPS on a weighted average basis 0.301 0.049
Basic & diluted EPS on a weighted average basis - continuing operations
0.301

0.044
B
.
N
et tangible assets (NTA)
The calculation of NTA per share, which is a required NZX disclosure, is based on the following NTA figure and the Company's issued ordinary
shares at the end of the period.
2021 2020*
$000 $000
Total assets 453,034 455,857
Total liabilities (279,496) (302,750)
less I
ntangible assets (15,663) (15,866)
less Deferred tax asset (8,173) (10,660)
Net tangible assets 149,702 126,580
2021 2020
$ $
NTA per issued ordinary shares at the end of period 1.983 1.677
Earnings Per Share Accounting Policies
The Group presents basic and diluted EPS data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to
shareholders by the weighted average number of shares outstanding during the period. Diluted EPS is determined by adjusting the profit or
loss attributable to shareholders and the number of shares outstanding to include the effects of all potential dilutive shares.
*
Refer to Note 29 for fur
ther details on the restatement of the comparative figures.
PGG WRIGHTSON LIMITED | 17

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
10 CASH AND FINANCING FACILITIES
2021 2020

N
OTE

$000 $000
Cash and cash equivalents 3,367 16,868
Current financing facilities
10(
A)
(9,900)

(30,000)
Term financing facilities 10(A) – (20,000)
Net interest-bearing (debt)/cash and cash equivalents (6,533) (33,132)
Go receivables 13 45,869 48,111
Net interest-bearing (debt)/cash and cash equivalents after adjusting for Go receivables 39,336 14,979
A. Financing facilities
During the year, the Company renegotiated its syndicated bank facility. The amended facility, which commenced on 9 November 2020, provides
the following:
–

T
erm debt facility of $60.00 million maturing on 2 November 2022. This facility is undrawn at 30 June 2021.
–
W
orking capital facilities of up to $70.00 million maturing on 2 November 2022 (subject to an annual Clean Down)
The syndicated facilities fund the general corporate activities of the Group, the seasonal fluctuations in working capital and Go receivables.
The Company has granted a general security deed and mortgage over all its wholly-owned New Zealand assets to a security trust. Bank of New
Zealand acts as facility agent and security trustee for the banking syndicate, which comprises Bank of New Zealand, Cooperatieve Rabobank U.A.
(New Zealand branch) and Westpac New Zealand Limited. The agreement contains various financial covenants and restrictions that are standard
for facilities of this nature, including maximum permissible ratios for debt leverage and operating leverage, together with limits for Go receivables,
capital expenditure and asset disposals.
The syndicated facility agreement allows the Group, subject to certain conditions, to enter into additional facilities outside of the Company's
syndicated facility. The additional facilities are guaranteed by the security trust. These facilities amounted to $6.53 million as at 30 June 2021 (2020:
$6.58 million).
–
O
verdraft facilities of $3.00 million
–
Guarant
ee, letters of credit and trade finance facilities of $3.53 million
18 | PGG WRIGHTSON LIMITED

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
11 DERIVATIVE FINANCIAL INSTRUMENTS
The Group uses forward foreign exchange contracts and spot foreign exchange contracts to manage its exposure to foreign currency fluctuations.
In accordance with the Group's treasury policy, the Group does not hold any of these derivative instruments for trading purposes.
2021 2020
$000 $000
Derivative assets held for risk management
Current 843 707
Non-
current
–

235
843

942
Deriv
ative liabilities held for risk management
Current (242) (562)
Non-
current
(143)

(45)
(385)

(607)
Net derivative asset/(liability) held for risk management 458 335
Derivative Financial Instruments Accounting Policies
Derivative financial instruments are recognised initially at fair value and transaction costs are expensed immediately. Subsequent to initial
recognition, derivative financial instruments are stated at fair value, and changes therein are generally recognised in profit or loss. The fair
value of forward exchange contracts is based on broker quotes.
Where the Group enters into derivative transactions, these agreements do not meet the criteria for offsetting in the consolidated statement
of financial position. The fair value amounts recognised in the consolidated statement of financial position are recorded on a gross basis.
The Group does not currently apply hedge accounting.
PGG WRIGHTSON LIMITED | 19

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
12 TRADE AND OTHER RECEIVABLES
2021 2020
$000 $000
Accounts receivable due from unrelated parties 124,364 106,427
Accounts receivable due from related parties
3

49
Gross accounts receivable 124,367 106,476
less Provision for impaired debtors (2,895) (3,539)
Net accounts receivable 121,472 102,937
Contract assets
2,083

2,121
less Provision for impaired contract assets (356) (486)
Other receivables 22,631 16,409
Prepayments 2,341 1,965
Trade and other receivables 148,171 122,946
Analysis of movements in provisions for impaired debtors & contract assets
Balance at beginning of year
(4,025)

(4,635)
M
ovement in provision
774

610
Balance at end of y
ear
(3,251) (4,025)
The aging status of the accounts receivable at the reporting date is as follows:

TOTA L TOTA L
DEBTORS PROVISION DEBTORS PROVISION
2021 2021 2020 2020
$000 $000 $000 $000
Not past due 114,336 (824) 97,740 (705)
Past due 1– 30 days 5,636 (14) 4,297 (311)
P
ast due 31– 60 days 894 (27) 930 (204)
Past due 61– 90 days 717 (59) 314 (157)
P
ast due 90 plus days 2,784 (1,971) 3,195 (2,162)
124,367 (2,895) 106,476 (3,539)
Trade and Other Receivables Accounting Policies
Recognition and measurement
A trade receivable without a significant financing component is initially measured at the transaction price and classified as financial assets
measured at amortised cost. Accounts receivables include accrued interest.
Impairment
Specific provisions are maintained to cover identified impaired debtors. Judgement is required in determining the impairment provision.
The Group recognises loss allowances on expected credit loss (ECL) on trade receivables. The Group measures loss allowances for trade
receivables at an amount equal to lifetime ECL.
When estimating ECLs, the Group considers reasonable and supportable information that is relevant and available without undue cost and
effort. This includes both qualitative and quantitative information and analysis, based on the Group's historical experience and informed
credit assessment, that includes forward-looking information. The Group assumes that the credit risk has increased significantly if it is more
than 60 days past due. The Group considers a financial asset to be in default when the debtor is unlikely to pay its credit obligations to the
Group in full, without recourse by the Group to actions such as realising security (if any is held).
On a monthly basis, the Group via its Credit Committee, assesses whether trade receivables are credit-impaired. All individual instruments
that are considered significant are subject to this approach. A financial asset is credit-impaired when one or more events that have a
detrimental impact on the estimated future cash flows of the financial asset have occurred. Evidence that a financial asset is credit-impaired
includes observable data such as significant financial difficulty of the debtor.
Loss allowances for financial assets measured at amortised cost are deducted from the gross carrying amount of the assets. The gross
carrying amount of a financial asset is written off when the Group has no reasonable expectations of recovering a financial asset in its
entirety or a portion thereof.
20 | PGG WRIGHTSON LIMITED

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
13 GO RECEIVABLES
The Group holds receivables in respect of its Go range of livestock products. The Go range allows farmers to defer payment for the purchase of
livestock. The counterparty to the Go product is fully exposed to the risks and rewards of ownership. To mitigate credit risk, the Group retains title
to the livestock until sale. Fee income received in respect of the Go receivables is recognised by the Group as interest income over the respective
contract period and is included within operating revenue (refer to Note 1 Operating Revenue). Accrued interest income in respect of the Go
receivables is included within Other Receivables (refer to Note 12 Trade and Other Receivables) and amounts to $1.20 million as at the balance date
(2020: $1.69 million).
2021 2020
$000 $000
Go receivables - less than one year 46,011 48,111
less Provision for impairment – Go receivables (142) –
45,869 48,111
The status of the Go receivables at the reporting date is as follows:
Not past due
45,869

48,111
Past due 142 –
46,011 48,111
14 INVENTORY
2021 2020*
$000 $000
Merchandise 64,935 64,959
Wool & velvet inventory
18,199

21,732
less Provision for inventory write down (1,636) (3,260)
81,498 83,431
During the year, inventories of $557.08 million (2020: $534.56 million) are included in cost of sales in the profit or loss (refer to Note 2 Cost of Sales).
Included within this amount are write-down of inventories of $0.55 million (2020: $1.93 million) to net realisable value and reversals of write-down
of $0.10 million (2020: $0.09 million).
Inventories Accounting Policies
Raw materials and finished goods are stated at the lower of cost or net realisable value. Cost is determined on a weighted average cost
basis. In the case of manufactured goods, cost includes direct materials, labour and production overheads. Judgement is required in
determining the net realisable value for inventories.
*
Refer to Note 29 for further details on the restatement of the comparative figures.
PGG WRIGHTSON LIMITED | 21

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
15 INTANGIBLE ASSETS
RIGHTS &

SOFT
WARE
TR
ADEMARKS
T
OTAL
$000 $000 $000
Cost
Balance at 1 July 2019*
22,042

1,818

23,860
Additions 7,281 98 7,379
Disposals and reclassification (1,050) – (1,050)
Balance at 30 June 2020* 28,273 1,916 30,189
Balance at 1 July 2020
28,273

1,916

30,189
A
dditions
1,309

874

2,183
Disposals and r
eclassifications
(310)

–

(310)
B
alance at 30 June 2021
29,272

2,790

32,062
A
mortisation and impairment losses
Balance at 1 July 2019*

9,230

1,299

10,529
Amor
tisation for the year
1,197

92

1,289
Disposals and r
eclassifications
2,505

–

2,505
B
alance at 30 June 2020*
12,932

1,391

14,323
Balance at 1 July 2020
12,932 1,391 14,323
Amor
tisation for the year
2,156

60

2,216
Disposals and r
eclassifications
(140)

–

(140)
B
alance at 30 June 2021
14,948

1,451

16,399
C
arrying amounts
At 30 June 2020*


15,341
525

15,866
A
t 30 June 2021
14,324

1,339

15,663
Inta
ngible Assets Accounting Policies
Software
Software is a finite life intangible and is recorded at cost less accumulated amortisation and impairment. Amortisation is charged on a
straight line basis over an estimated useful life between 1 and 15 years. The estimated useful life and amortisation method is reviewed at the
end of each annual reporting period and adjusted if appropriate.
Rights
Manufacturing and production rights are finite life intangibles and are recorded at cost less accumulated amortisation and impairment.
Amortisation is charged on a straight line basis over an estimated useful life between 2 and 10 years. The estimated useful life and
amortisation method is reviewed at the end of each annual reporting period and adjusted if appropriate.
Impairment
The carrying amounts of the Group's intangible assets are reviewed at each reporting date to determine whether there is any indication of
impairment. If any such indication exists, then the recoverable amount of the asset is estimated. For intangible assets that have indefinite
lives, the recoverable amount is estimated at each reporting date. An impairment loss is recognised in the profit or loss if the carrying
amount of an asset exceeds the recoverable amount. Refer to the accounting policy under Note 5 Impairment and Fair Value Gains/(Losses)
for further explanation.
*

Refer to Note 29 for fur
ther details on the restatement of the comparative figures.
22 | PGG WRIGHTSON LIMITED

Refer to
Accounting
Policies
– page 24
PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
16 RIGHT-OF-USE ASSETS AND LEASE LIABILITIES
Group as a lessee
The Group leases many assets, including:
–

leases of land and buildings fr
om which it conducts operations. These leases range in length from one to fifteen years with various rights of
renewal. Where surplus properties are unable to be exited, the Group subleases these properties where possible and derives sublease revenue
on a short-term temporary basis.
–
leases of mot
or vehicles and forklifts for use by employees, agents and representatives. These leases range for a period of between three and
seven years.
–

leases of office and IT equipment.
These leases are typically for a period of up to four years.
The Group elects not to recognise right-of-use assets and lease liabilities for short-term or low-value leases, such as leases of office and IT
equipment. The Group continues to expense lease payments associated with these leases on a straight-line basis.
A.
R
ight-of-use assets
PROPERTY VEHICLES TOTAL
$000 $000 $000
Balance at 1 July 2019 97,084 12,082 109,166
Additions 11,498 5,644 17,142
D
epreciation charge for the period (13,623) (6,669) (20,292)
Reassessments, modifications and terminations (881) 342 (539)
Net impair
ment reversal / (impairment) (852) – (852)
B
alance at 30 June 2020
93,226

11,399

104,625

Balance at 1 July 2020
93,226

11,399

104,625
A
dditions
7,755

5,705

13,460
D
epreciation charge for the period
(13,391)

(6,288)

(19,679)
R
eassessments, modifications and terminations
1,590

158

1,748
Net impair
ment reversal / (impairment)
910

–

910
B
alance at 30 June 2021
90,090

10,974

101,064
B
.
L
ease liabilities
PROPERTY VEHICLES TOTAL

$000 $000 $000
Balance at 1 July 2019 94,544 12,082 106,626
Additions, reassessments, modifications and terminations
11,879

5,985

17,864
Interest on lease liabilities 3,768 417 4,185
Lease payments
(14,844)

(6,927)

(21,771)
B
alance at 30 June 2020
95,347

11,557

106,904
Balance at 1 July 2020

95,347

11,557

106,904
A
dditions, reassessments, modifications and terminations
22,214

10,830

33,044
I
nterest on lease liabilities
3,633

403

4,036
L
ease payments
(28,380)

(11,586)

(39,966)
B
alance at 30 June 2021
92,814

11,204

104,018
A matur
ity analysis of lease liabilities is included in Note 20 Financial Instruments – Fair Values and Risk Management.
PGG WRIGHTSON LIMITED | 23

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
16 RIGHT-OF-USE ASSETS AND LEASE LIABILITIES (CONTINUED)
B. Lease liabilities
Where practicable, the Group seeks to include extension options in new leases to provide operational flexibility. Some of the Group's property
leases contain extension options exercisable by the Group up to one year before the end of the non-cancellable contract period. The extension
options are exercisable only by the Group and not by the lessors. The Group assesses at lease commencement date whether it is reasonably certain
to exercise the extension options. A reassessment is made subsequently if there is any significant event or significant changes in circumstances
within the Group's control. The Group estimates that the potential future lease payments, should it exercise all the extension options, would result
in an increase in lease liability of $85.2 million (2020: $65.0 million).
C.

O
ther disclosures
2021 2020
$000 $000
Amount in the consolidated statement of profit or loss
Depreciation on right-of-use assets - continuing operations
(19,679)

(20,265)
Interest on lease liabilities (4,036) (4,183)
Short-term or low-value lease expenses (860) (712)
V
ariable lease payments not included in the measurement of lease liabilities
(153)

(168)
I
ncome from sub-leasing right-of-use assets
905

1,149
G
ain/(loss) arising from sale and leaseback transactions
339

–
A
mounts in the consolidated statement of cashflows
Total cash outflow for leases
(22,335)

(21,771)
L
ease Accounting Policies
The Group adopted NZ IFRS 16 Leases from 1 July 2019. The Group assesses at the inception of a contract as to whether the contract is, or
contains, a lease as defined in NZ IFRS 16 Leases.
(i) As a lessee
The Group recognises a right-of-use asset and a lease liability at the lease commencement date. The Group elects not to recognise right-of-
use assets and lease liabilities for short-term or low-value leases, such as leases of office and IT equipment. The Group continues to expense
lease payments associated with these leases on a straight-line basis.
A number of judgements and estimates are made in calculating the right-of-use asset and lease liability amounts. The judgements and
estimates include the applicable lease terms (including any rights of renewal expected to be exercised) and the Group's incremental
borrowing rate.
Right-of-use assets
Right-of-use assets are initially measured at cost, which comprises the initial amount of lease liability adjusted for any prepaid lease
payments, plus any initial direct costs incurred and any estimated restoration costs, and less any lease incentives received. These assets are
depreciated using the straight-line method from the commencement date to the earlier of the end of the lease term or the asset's useful
life. Right-of-use assets are periodically reduced by impairment losses (if any) and adjusted for certain remeasurements of the lease liabilities.
Lease liabilities
Lease liabilities are initially measured at the present value of the lease payments that are not paid at the commencement date. Lease
payments included in the measurement of the lease liability comprise fixed payments, variable lease payments that are based on an index
or a rate, amounts expected to be payable under a residual value guarantee, and any exercise price the Group is reasonably certain to
exercise. The lease payments are discounted using the Group's incremental borrowing rate, being the rate that the Group would have to
pay to borrow the fund necessary to obtain an asset of similar value in a similar environment under similar terms and conditions.
After the commencement date, lease liabilities are increased to reflect interest on the lease liabilities and reduced to reflect the lease
payments made. Interest on lease liabilities is charged to the profit and loss and is the amount that produces a constant periodic rate of
interest on the remaining balance of the lease liabilities.
Lease liabilities are remeasured when there is a change in future lease payments arising from a change in an index or rate, a change in the
Group's estimate of any amount payable under a residual value guarantee, or if the Group changes its assessment of whether it will exercise
a purchase, extension or termination option. When the lease liabilities are remeasured, a corresponding adjustment is made to the carrying
amount of the right-of-use assets, or recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.
(ii) As a lessor
When the Group is an intermediate lessor, it accounts for its interests in the head lease and the sublease separately. It assesses the lease
classification of a sub-lease with reference to the right-of-use asset arising from the head lease.
The Group recognises lease payments received under operating leases as income on a straight-line basis over the lease term.
24 | PGG WRIGHTSON LIMITED

Refer to
Accounting
Policies
– page 26
PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
17 PROPERTY, PLANT AND EQUIPMENT
PLANT AND CAPITAL WORKS
LAND BUILDINGS
EQUIPMENT
PR
OJECT*
T
OTAL

$000 $000 $000 $000 $000
Cost
Balance at 1 July 2019
13,183

14,245

49,678

2,804

79,910
Additions – 119 5,362 (62) 5,419
Reclassification from/(to) assets held for sale 322 1,706 – – 2,028
Disposals and transfers (3) (727) (3,045) – (3,775)
Balance at 30 June 2020 13,502 15,343 51,995 2,742 83,582
Balance at 1 July 2020 13,502 15,343 51,995 2,742 83,582
Additions – 279 4,847 (88) 5,038
Disposals and transf
ers
(772)

(1,293)

(763)


–
(2,828)
Balance at 30 June 2021 12,730 14,329 56,079 2,654 85,792
Depreciation and impairment losses
Balance at 1 July 2019 – 6,340 28,868 – 35,208
D
epreciation for the year

–
285

4,828


–
5,113
D
epreciation recovered to COGS – – 181 – 181
R
eclassification from/(to) assets held for sale

–
(60)


–

–
(60)
Disposals and transf
ers

–
(702)

(2,368)


–
(3,070)
I
mpairment / (impairment reversal)

–
(254)

133


–
(121)
Balance at 30 June 2020 – 5,610 31,642 – 37,252
Balance at 1 July 2020 – 5,610 31,642 – 37,252
Depreciation for the year – 312 5,037 – 5,349
D
epreciation recovered to COGS – – 187 – 187
Disposals and transfers – (141) (443) – (584)
I
mpairment / (impairment reversal) – (906) (133) – (1,039)
Balance at 30 June 2021 – 4,875 36,290 – 41,165
Carrying amounts
At 30 June 2020 13,502 9,733 20,353 2,742 46,330
At 30 June 2021
12,730 9,454 19,789 2,654 44,627
* Capital works projects are recorded net of transfers to other asset classes.
Capital gains on the sale of property, plant and equipment of $0.96 million were recognised in non-operating items in the current period
(2020: $0.15 million gain).
PGG WRIGHTSON LIMITED | 25

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
17 PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
Property, Plant & Equipment Accounting Policies
Recognition and measurement
Items of property, plant and equipment are stated at cost less accumulated depreciation and impairment. Cost includes expenditure that
is directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct labour, any
other costs directly attributable to bringing the asset to a working condition for its intended use, and the cost of dismantling and removing
the items and restoring the site on which they are located. Purchased software that is integral to the functionality of the related equipment
is capitalised as part of that equipment. When parts of an item of property, plant and equipment have different useful lives, they are
accounted for as separate items (major components) of property, plant and equipment.
Any gain or loss on disposal of an item of property, plant and equipment is recognised in profit or loss.
Subsequent expenditure
Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated with the expenditure will flow to
the Group and the cost can be measured reliably. The costs of day-to-day servicing of property, plant and equipment is recognised in profit
or loss as incurred.
Depreciation
Depreciation is recognised in profit or loss on a straight-line basis over the estimated useful lives of each item of property, buildings, plant
and equipment. Leasehold assets are depreciated over the shorter of the lease term and their useful lives. Land is not depreciated. The
estimated useful lives for the current and comparative periods are between 2 and 40 years for plant and equipment and 50 years for
buildings. Depreciation methods, useful lives and residual values are reassessed at each reporting date and adjusted if appropriate.
Impairment
The carrying amounts of the Group's property, plant & equipment assets are reviewed at each reporting date to determine whether there
is any indication of impairment. If any such indication exists, then the recoverable amount of the asset is estimated. An impairment loss is
recognised in the profit or loss if the carrying amount of an asset exceeds the recoverable amount. Refer the accounting policy under
Note 5 Impairment and Fair Value Gains/(Losses) for further explanation.
18 TRADE AND OTHER PAYABLES
2021 2020
NOTE $000 $000
Trade creditors 109,162 81,835
Goods received but not invoiced 5,249 5,799
D
eposits received in advance 960 1,474
Employee entitlements 18,015 13,960
W
age subsidy received in advance 7 - 958
Accruals and other liabilities
21,161

26,940
L
oyalty reward programme
22

1,073

998
O
ther provisions (including product warranty, client claim and make good provisions)
18(
A), 18(B)
6,107

3,437
161,727 135,402
Payable within 12 months 158,883 132,600
Payable beyond 12 months 2,844 2,802
161,727 135,402
A. Make good provision on leased properties
During the year, the Group recognised an additional provision of $0.19 million (2020: $0.14 million) in respect of new leased properties which
it signed up to. These costs have been capitalised to the right-of-use assets and are amortised over the life of the right-of-use assets. The Group
also released $0.15 million (2020: Nil) of provision in respect to leased properties which it exited. At balance date, the balance of the make good
provision is $2.71 million (2020: $2.68 million). The Group expects to settle this liability over the next 10-15 years as the leases expire.
26 | PGG WRIGHTSON LIMITED

Refer to
Accounting
Policies
– page 29.
PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
18 TRADE AND OTHER PAYABLES (CONTINUED)
B. Client claims provision
The Group receives client claims from time to time as part of the ordinary course of business and these claims are reviewed on a case by case basis
to determine validity. As at balance date, the Group was in the process of reviewing certain claims for the supply of goods which are typically the
responsibility of suppliers under terms of trade. The Group recognises a provision for its best estimate of any obligation. The information usually
required by IAS 37 Provisions, Contingent Liabilities and Contingent Assets is not disclosed on the grounds of commercial sensitivity, i.e. disclosure
may impact the position of the Group.
19 DEFINED BENEFIT ASSET/LIABILITY
The Group makes contributions to the PGG Wrightson Employee Benefits Plan (the Plan), a defined benefit plan that provides a range of
superannuation and insurance benefits for employees and former employees. The Plan is registered under the Financial Markets Conduct Act
2013. The Plan is not open to new members. The Plan's retired employees are entitled to receive an annual pension payment payable for their
remaining life, and in some cases, for the remaining life of a surviving spouse. In June 2019, the Group brought the Plan to an actuarial equilibrium
position (calculated on a different basis to the IFRS amounts below).
The actuarial calculations for the Plan are undertaken by Michael Chamberlain, a fellow of the New Zealand Society of Actuaries, for MCA NZ
Limited.
2021 2020 2019 2018 2017
$000 $000 $000 $000 $000
Present value of funded obligations (56,172) (62,563) (61,624) (66,814) (71,106)
Fair value of plan assets 56,483 52,725 55,741 59,092 58,835
Total defined benefit asset/(liability) 311 (9,838) (5,883) (7,722) (12,271)
A. Movement in net defined benefit asset/(liability)
NET DEFINED BENEFIT ASSET/
DEFINED BENEFIT OBLIGATION FAIR VALUE OF PLAN ASSETS (LIABILITY)
2021 2020 2021 2020 2021 2020
$000 $000 $000 $000 $000 $000
Balance at 1 July (62,563) (61,624) 52,725 55,741 (9,838) (5,883)
Included in profit or loss:
Current service costs
(529) (613) – – (529) (613)
Interest costs
(558)

(937)

470

845

(88)

(92)
Included in other comprehensive income:
Gains/(losses) from change in financial assumptions
3,323 (799) – – 3,323 (799)
Exper
ience gains/(losses) 1,130 (3,059) – – 1,130 (3,059)
Expected return on plan assets – – 5,353 (84) 5,353 (84)
Other:
Employer contributions – – 960 692 960 692
Member contributions (782) (832) 782 832 – –
Benefits paid by the plan 3,807 5,301 (3,807) (5,301) – –
Balance at 30 June

(56,172)

(62,563)

56,483

52,725

311

(9,838)
T
he Group expects to pay $0.78 million in contributions to the Plan in 2022 (2021: expected $0.85 million and paid $0.96 million).
Member contributions are expected to be $0.56 million in 2022 (2021: expected $0.59 million and paid $0.78 million).
As at 30 June 2021, the weighted average duration of the defined benefit obligation (DBO) is 12.2 years for the Plan (2020: 12.5 years).
PGG WRIGHTSON LIMITED | 27

Refer to
Accounting
Policies
– page 29.
PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
19 DEFINED BENEFIT ASSET/LIABILITY (CONTINUED)
B. Plan assets
2021 2020
% %
Consist of:
Equities 63 58
F
ixed interest
28

29
C
ash
9

13
100 100
Plan assets do not include any exposure to the Company's ordinary shares (2020: Nil).
C. Actuarial assumptions at the reporting date
2021 2020
% %
Discount rate used - Implied 12.2 year New Zealand Government Bond rate
(2020: 10 year New Zealand Government Bond rate) 1.99 0.91
Inflation 1.50 1.50
F
uture salary increases 2.00 2.00
Future pension increases 1.50 1.50
2021 2021 2020 2020
MALE FEMALE MALE FEMALE)
YEARS YEARS YEARS YEARS
Assumptions regarding future mortality rates based on published statistics and experience:
Longevity at age 65 for current pensioners
21

24

21

24
Longevity at age 65 for current members aged 45 24 28 24 28
D.
S
ensitivity analysis
The sensitivity of the DBO to changes in the weighted principal assumptions is:
2021 2021 2020 2020
DBO (INCREASE) DBO (INCREASE) DBO (INCREASE) DBO (INCREASE)
/ DECREASE WITH / DECREASE WITH / DECREASE WITH / DECREASE WITH
INCREASE
IN
DECREASE
IN
INCREASE
IN
DECREASE
IN

ASSUMPTION

ASSUMPTION
ASSUMPTION ASSUMPTION
$000 $000 $000 $000
Discount rate (0.50% movement) 1,348 (1,460) 1,689 (2,252)
Salary growth rate (0.50% movement) (112) 112 (188) 63
P
ension growth rate (0.25% movement)
(674)

337

(1,001)

876
Lif
e expectancy (1 year movement)
(1,741)

1,798

(2,127)

2,127

28 | PGG WRIGHTSON LIMITED

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
19 DEFINED BENEFIT ASSET/LIABILITY (CONTINUED)
Employee Benefits Accounting Policies
Defined benefit plans
The Group's net obligation with respect to defined benefit plans is calculated by estimating the amount of future benefit that employees
have earned in return for their service in the current and prior periods, discounting that amount and deducting the fair value of any plan
assets is deducted. The discount rate is the yield at the reporting date on bonds that have maturity dates approximating the terms of the
Group's obligations. The calculation is performed by a qualified actuary using the projected unit credit method. When the calculation
results in a potential asset for the Group, the recognised asset is limited to the lower of the net assets of the plan or the current value of the
contributions holiday that is expected to be generated.
Remeasurement of the net defined benefit asset/liability, which comprise actuarial gains and losses and the return on plan assets, are
recognised directly in other comprehensive income and the defined benefit plan reserve in equity. Net interest expense and other expenses
related to defined benefit plans are recognised in profit or loss.
Short-term employee benefits
Short-term employee benefits are expensed as the related service is provided. A liability is recognised for the undiscounted amount of
short-term employee benefits expected to be paid if the Group has a present legal or constructive obligation to pay this amount as a result
of past service provided by the employee and the obligation can be estimated reliably.
Long-term employee benefits
Provisions made with respect to employee benefits which are not expected to be settled within twelve months are measured as the present
value of the estimated future cash outflows to be made by the Group with respect to services provided by employees up to reporting date.
Remeasurements are recognised in profit or loss in the period in which they arise.
PGG WRIGHTSON LIMITED | 29

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
20 FINANCIAL INSTRUMENTS – FAIR VALUES AND RISK MANAGEMENT
A. Accounting classifications and fair values
The tables below set out the Group's classification of each class of financial assets and liabilities, and their fair values.
FAIR VALUE
THROUGH AT AMORTISED TOTAL CARRYING

PROFIT OR LOSS COST AMOUNT FAIR VALUE
$000 $000 $000 $000
2021
Financial assets
Cash and cash equivalents – 3,367 3,367 3,367
Derivative assets 843 – 843 843
Trade receivables – 121,472 121,472 121,472
Go r
eceivables
–

45,869

45,869

45,869
Other investments – 474 474 474
843 171,182 172,025
Financial liabilities
Debt – (9,900) (9,900) (9,900)
Derivative liabilities (385) – (385) (385)
Trade creditors – (109,162) (109,162) (109,162)
Lease liabilities – (104,018) (104,018)
(385) (223,080) (223,465)
2020
Financial assets
Cash and cash equivalents – 16,868 16,868 16,868
Derivative assets 942 – 942 942
Trade receivables – 102,937 102,937 102,937
Go receivables – 48,111 48,111 48,111
Other investments – 471 471 471
942 168,387 169,329
Financial liabilities
Debt – (50,000) (50,000) (50,000)
Derivative liabilities (607) – (607) (607)
Trade creditors – (81,835) (81,835) (81,835)
Lease liabilities – (106,904) (106,904)
(607) (238,739) (239,346)
The Group's banking facilities are based on floating interest rates. Therefore, the fair value of the banking facilities equals the carrying value.
30 | PGG WRIGHTSON LIMITED

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
20 FINANCIAL INSTRUMENTS – FAIR VALUES AND RISK MANAGEMENT (CONTINUED)
A. Accounting classifications and fair values (continued)
Fair value hierarchy
The table below analyses financial instruments carried at fair value by valuation method. The different levels have been defined as follows:
–
L
evel 1: quoted prices (unadjusted) in active markets for identical assets or liabilities
–
Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (ie. as prices) or
indirectly (ie. derived from prices)
–
L
evel 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs)
LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
$000 $000 $000 $000
2021
Derivative assets – 843 – 843
D
erivative liabilities
–

(385)

–

(385)
2020
Derivative assets – 942 – 942
Derivative liabilities – (607) – (607)
B. Financial management risk
The Group's primary risks are those of liquidity and funding, credit and market (foreign currency, price and interest rate) risks.
The Group is committed to the management of risk to achieve sustainability of service, employment and profits, and therefore, takes on controlled
amounts of risk when considered appropriate. The Board of Directors is responsible for the review and ratification of the Group's systems of risk
management, internal compliance and control, code of conduct and legal compliance. The Board maintains a formal set of delegated authorities
(including policies for credit and treasury) that clearly define the responsibilities delegated to Management and those retained by the Board. The
Board approves these delegated authorities and reviews them annually.
The following management committees review and manage key risks:
–
T
he Senior Management Team meets regularly to consider new and emerging risks, review actions required to manage and mitigate key risks,
and to monitor progress.
–
T
he Credit Committee, comprising of management appointees, meets regularly to review credit risk, account limits and provisioning.
Management formally reports on all aspects of key risks to the Audit Committee at least two times each year.
(i) Liquidity and funding risks
Liquidity risk is the risk that the Group will encounter difficulties in raising funds at short notice to meet commitments associated with financial
instruments. Funding risk is the risk of over-reliance on a funding source to the extent that a change in that funding source could increase overall
funding costs or cause difficulty in raising funds.
The Group manages liquidity risk by forecasting daily cash requirements and future funding requirements, and maintaining an adequate liquidity
buffer. The Group monitors its liquidity daily, weekly and monthly and maintains appropriate liquid assets and committed bank funding facilities to
meet all obligations in a timely and cost efficient manner. The Group has a policy of funding diversification and utilises a banking syndicate to limit
concentration risk in relation to liquidity and funding. The funding policy augments the Group's liquidity policy with its aim to ensure the Group
has a stable diversified funding base without over-reliance on any one market sector.
The objectives of the Group's funding and liquidity policy is to:
–
Ensure all financial obligations are met when due;
– Provide adequate protection, even under crisis scenarios; and
– Achieve competitive funding within the limitations of liquidity requirements.
PGG WRIGHTSON LIMITED | 31

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
20 FINANCIAL INSTRUMENTS – FAIR VALUES AND RISK MANAGEMENT (CONTINUED)
B. Financial management risk (continued)
(i) Liquidity and funding risks (continued)
Contractual maturity analysis
The following schedule analyses the Group's financial liabilities into relevant maturity groupings based on the remaining period at the balance
date to the contractual maturity date (reported on an undiscounted basis). History demonstrates that such accounts provide a stable source of
long term funding for the Group.
CONTRACTUAL CASH FLOW
WITHIN BEYOND AMOUNT IN
1
2 MONTHS
1
TO 5 YEARS
5
YEARS
T
OTAL
BALANCE
SHEET


$000 $000 $000 $000 $000
2021
Debt 11,068 – – 11,068 9,900
D
erivative liabilities
242

143

–

385

385
T
rade creditors 109,162 – – 109,162 109,162
L
ease liabilities 21,164 57,399 41,094 119,657 104,018
141,636 57,542 41,094 240,272 223,465
2020
Debt 31,456 20,103 – 51,559 50,000
D
erivative liabilities 562 45 – 607 607
Trade creditors 81,835 – – 81,835 81,835
L
ease liabilities
20,296

57,544

47,228

125,068

106,904
134,149 77,692 47,228 259,069 239,346
Changes in liabilities arising from financing activities
CHANGES IN
1 JUL 2020 CASHFLOWS FAIR VALUE OTHER 30 JUN 2021
$000 $000 $000 $000 $000
Debt 50,000 (40,100) – – 9,900
Derivative liabilities
607

–

(222)

–

385
Lease liabilities 106,904 (18,299) – 15,413 104,018
Total liabilities from financing activities 157,511 (58,399) (222) 15,413 114,303
CHANGES IN
1 JUL 2019 CASHFLOWS FAIR VALUE OTHER 30 JUN 2020

$000 $000 $000 $000 $000
Debt 2,680 47,320 – – 50,000
Derivative liabilities 342 – 265 – 607
Lease liabilities – (17,586) – 124,490 106,904
Total liabilities from financing activities 3,022 29,734 265 124,490 157,511
(ii) Credit risk
Credit risk is the potential for loss that could occur as a result of a counterparty failing to discharge its obligations. This may be due to drought, bio-
security issues or volatility in commodity prices.
Concentrations of credit risk
Financial instruments which potentially subject the Group to concentrations of credit risk principally consist of bank balances, trade receivables,
Go receivables and forward foreign exchange contracts. The Group places its cash and short term investments with three major trading banks.
Concentrations of credit risk with respect to trade and Go receivables are limited due to the large number of customers included in the Group's
farming customer base in New Zealand.
32 | PGG WRIGHTSON LIMITED

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
20 FINANCIAL INSTRUMENTS – FAIR VALUES AND RISK MANAGEMENT (CONTINUED)
B. Financial management risk (continued)
(iii) Market risk
Market risk is the potential for change in the value of balance sheet positions caused by a change in the value, volatility or relationship between
market risks and prices. Market risk arises from the mismatch between assets and liabilities, both on and off balance sheet. Market risk includes
price, foreign currency and interest rate risk which are explained as follows.
Concentrations of market risk
The Group has exposure to commodity pricing risk on Wool inventories and forward Wool sales and purchase contracts. This is mitigated by the
Group having policies around unmatched positions. Other inventory is of merchandise nature and the Group has a range of suppliers or has
entered into long-term supply agreements.
Foreign currency risk
The Group undertakes transactions denominated in foreign currencies and exposure to movements in foreign currency arises from these activities.
The Group manages this risk by using forward and spot foreign exchange contracts to hedge foreign currency risks as they arise.
Foreign currency exposure risk
The Group's exposure to foreign currency risk is summarised below. The notional forward exchange cover includes forward foreign exchange
contracts entered into to economically hedge forward sale and purchase commitments.
GBP USD AUD EURO
NZ$000 NZ$000 NZ$000 NZ$000
2021
Cash and cash equivalents – 61 – 127
T
rade receivables 12 1,104 155 3,842
Trade creditors (1,141) (14,780) (1,664) (3,855)
Net balance sheet position
(1,129) (13,614) (1,509) 113
Forward exchange contracts on balance sheet items
and forward sale and purchase commitments
Notional forward exchange cover

(5,708)

7,783

1,491

(14,655)
Net unhedged position
4,579 (21,398) (3,001) 14,768
2020
Cash and cash equivalents
–

1

13

1
Trade receivables 82 2,047 – 1,827
Trade creditors
(532)

(8,366)

(972)

(2,151)
Net balance sheet position
(450) (6,318) (959) (323)
Forward exchange contracts on balance sheet items
and forward sale and purchase commitments
Notional forward exchange cover
8,356

(1,764)

972

(15,777)
Net unhedged position
(8,806) (4,554) (1,931) 15,454
PGG WRIGHTSON LIMITED | 33

Refer to
Accounting
Policies
– page 35.
PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
20 FINANCIAL INSTRUMENTS - FAIR VALUES AND RISK MANAGEMENT (CONTINUED)
B. Financial management risk (continued)
(iii) Market risk (continued)
Interest rate risk
Floating rate borrowings are used for general funding activities. Interest rate risk is the risk that the value of financial instruments and the interest
margin will fluctuate as a result of changes in market interest rates. The risk is that financial assets may be repriced at a different time and/or by a
different amount than financial liabilities.
This risk is managed by operating within approved policy limits using an interest rate duration approach. Interest rate swaps, interest rate options
and forward rate agreements may be used to hedge the floating rate exposure as deemed appropriate. The Group had no interest rate derivatives
at balance date (2020: Nil).
Interest rate repricing schedule
The following tables include the Group's liabilities at their carrying amounts, categorised by the earlier of contractual repricing or maturity dates.
WITHIN 1 TO 2 OVER NON INTEREST
1
2 MONTHS
Y
EARS
2
YEARS
BEARING T
OTAL

$000
$000 $000 $000 $000
2021
Debt
9,900

–

–

–

9,900
Derivative liabilities – – – 385 385
Trade creditors
–

–

–

109,162

109,162
9,900 – – 109,547 119,447
2020
Debt
30,000

20,000

–

–

50,000
Derivative liabilities – – – 607 607
Trade creditors
–

–

–

81,835

81,835
30,000 20,000 – 82,442 132,442
Sensitivity analysis
The Group's treasury policy effectively insulates earnings from the effect of short-term fluctuations in either foreign exchange or interest rates. Over
the longer term however, permanent changes in foreign exchange rates and interest rates will have an impact on profit. A 1% change in interest
rate has been applied as it is considered a reasonably possible change. The sensitivity of net profit after tax for the period to 30 June 2021, and
shareholders equity at that date, to reasonably possible changes in conditions is shown below.
INTEREST RATES INCREASE BY 1% INTEREST RATES DECREASE BY 1%
2021 2020 2021 2020
$000 $000 $000 $000
Increase/(decrease) in net profit after tax and shareholders' equity (235) (198) 321 217
Other market risks such as pricing and foreign exchange are not considered likely to lead to material change over the next reporting period. The
Group's financial assets and liabilities are predominantly held in NZD. For this reason, a sensitivity analysis of these market risks is not included.
C.

C
apital management
T
he capital of the Group consists of share capital, reserves, and retained earnings. The policy of the Group is to maintain a strong capital base so
as to maintain investor, creditor and market confidence while providing the ability to develop future business initiatives. This policy has not been
changed during the period.
34 | PGG WRIGHTSON LIMITED

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
20 FINANCIAL INSTRUMENTS - FAIR VALUES AND RISK MANAGEMENT (CONTINUED)
Non-Derivative Financial Instruments Accounting Policies
(i) Non-derivative financial assets
Non-derivative financial assets comprise cash and cash equivalents, trade and other receivables, and investments in equity and debt
securities.
The Group initially recognises financial assets on the date at which the Group becomes a party to the contractual provisions of the
instrument, although trade receivables are initially recognised when they are originated.
Financial assets are initially measured at fair value. If the financial asset is not subsequently measured at fair value through profit or loss, the
initial investment includes transaction costs that are directly attributable to the asset's acquisition or origination. The Group subsequently
measures financial assets at either fair value or amortised cost.
Financial assets measured at amortised cost
A financial asset is subsequently measured at amortised cost using the effective interest method and net of any impairment loss, if:
–
the asset is held within a business model with an objec
tive to hold assets in order to collect contractual cash flows; and
–
the contrac
tual terms of the financial asset give rise, on specified dates, to cash flows that are solely payments of principal and interest.
Financial assets measured at fair value
Financial assets other than those classified as financial assets measured at amortised cost are subsequently measured at fair value with all
changes recognised in profit or loss.
However, for investments in equity instruments that are not held for trading, the Group may elect at initial recognition to present gains
and losses through other comprehensive income. For instruments measured at fair value through other comprehensive income gains
and losses are never reclassified to profit and loss and no impairments are recognised in profit and loss. Dividends earned from such
investments are recognised in profit and loss unless the dividends clearly represent a repayment of part of the cost of investment.
Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits held at call with banks, other short term highly liquid investments with maturities
of three months or less. Bank overdrafts that are repayable on demand and form an integral part of the Group's cash management are
included as a component of cash and cash equivalents.
Trade and other receivables
Trade and other receivables are stated at their amortised cost less impairment losses.
(ii) Non-derivative financial liabilities
Interest-bearing borrowings
Interest-bearing borrowings are classified as other financial liabilities and are initially recognised at fair value plus any directly attributable
transaction costs. Subsequent to initial recognition, these liabilities are measured at amortised cost using the effective interest method.
Trade and other payables
Trade and other payables are stated at cost.
(iii) Determination of fair values for non-derivative financial instruments
Fair value, which is determined for disclosure purposes, is calculated based on the present value of future principal and interest cash flows,
discounted at the market rate of interest at the reporting date.
PGG WRIGHTSON LIMITED | 35

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
21 COMMITMENTS
A. Capital expenditure not provided for
The Group does not have any capital commitments as at 30 June 2021 (2020: $Nil).
B.
F
orward purchase commitments
The Group as part of its ordinary course of business enters into forward purchase agreements with wool growers. These commitments extend
for periods of up to 3 years and are at varying stages of execution. There remains uncertainty associated with yield, quality and market price.
Therefore, the Group is unable to sufficiently quantify the value of these commitments.
C. Forward sales commitments
The Group as part of its ordinary course of business enters into forward sales agreements with wool customers. These commitments extend
for periods of up to 3 years and are at varying stages of execution. There remains uncertainty associated with yield, quality and market price.
Therefore, the Group is unable to sufficiently quantify the value of these commitments.
22 CONTINGENT LIABILITIES
A. PGG Wrightson Loyalty Reward Programme
The Group recognises a provision for the expected level of points redemption from the PGG Wrightson Loyalty Reward Programme. As at balance
date, the balance of live points which does not form part of the recognised provision total $0.09 million (2020: $0.09 million). Losses are not
expected to arise from this contingent liability.
B.
C
ontingent liabilities
The Group may receive client claims as part of the ordinary course of business in the supply of goods and services. The Group will pursue recovery
of claims with suppliers where appropriate under terms of trade. Accordingly, the amount of any obligation in respect of these claims or potential
claims cannot be estimated with sufficient reliability.
23 SEASONALITY OF OPERATIONS
The Group is subject to significant seasonal fluctuations. The Group's earnings are weighted towards the first half of the financial year and are
primarily related to the Retail business, as demand for New Zealand farming inputs are generally weighted towards the spring season. The second
half earnings predominantly relate to Livestock trading as farmers seek to maximise their income following New Zealand's spring calving and
lambing season. Other business units have similar but less material cycles. The Group recognises that this seasonality is the nature of the industry
and plans and manages its business accordingly.
36 | PGG WRIGHTSON LIMITED

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
24 SUBSEQUENT EVENTS
Dividend
On 16 August 2021, the Directors of PGG Wrightson Limited resolved to pay a final dividend of 16 cents per share on 4 October 2021 to
shareholders on the Company's share register as at 5.00pm on 10 September 2021. This dividend will be fully imputed.
25 RELATED PARTIES
A. Key management personnel compensation
2021 2020
$000 $000
Key management personnel compensation comprised:
Short-term employee benefits 4,234 3,216
P
ost-employment benefits 87 96
4,321 3,312
Directors fees incurred during the year are disclosed in Note 3 Other Operating Expenses.
B.
O
ther transactions with key management personnel
One Dir
ector, Senior Executives or their related parties, hold positions in other entities that result in them having control or significant influence
over the financial or operating policies of these entities. A number of these entities transacted with the Group during the reporting period.
The terms and conditions of these transactions with key management personnel and their related parties were no more favourable than those
available, or which might reasonably be expected to be available, on similar transactions to non-key management personnel and their related
entities on an arm's length basis.
The aggregate value of transactions and outstanding balances (on a GST inclusive basis) relating to the Director, Senior Executives and entities over
which they have control or significant influence were as follows:
TRANSACTION BALANCE TRANSACTION BALANCE
VALUE OUTSTANDING VALUE OUTSTANDING
2021 2021 2020 2020

$000 $000 $000 $000
Key Management
Personnel/Director Transaction
Nick Berry
P
urchase of retail goods
1

–

2

–
Da
vid Cushing
(retired 30 April 2021)

P
urchase of retail goods, livestock and wool
1,640

–

2,424

43

transactions. Also includes real estate
commissions on a property sale
St
ephen Guerin
P
urchase of retail goods and livestock transactions
26

–

9

1
P
eter Moore
P
urchase of retail goods
5

–

5

1



and fuel on–
charge transactions
Peter Newbold Purchase of retail goods 22 2 25 3
Peter Scott
P
urchase of retail goods
5

1

4

1


and fuel on–
charge transactions
PGG WRIGHTSON LIMITED | 37

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
26 REPORTING ENTITY
PGG Wrightson Limited (the "Company") is a company domiciled in New Zealand and registered under the Companies Act 1993 in New Zealand.
The Company's registered office is at 1 Robin Mann Place, Christchurch. The Company is listed on the New Zealand Stock Exchange and is an FMC
Reporting Entity for the purposes of the Financial Markets Conduct Act 2013.
The consolidated financial statements of PGG Wrightson for the year ended 30 June 2021 comprise the Company and its subsidiaries (together
referred to as the "Group"). The Group is primarily involved in the provision of goods and services within the agricultural and horticultural sectors.
OWNERSHIP INTEREST
COUNTRY OF 2021 2020
SIGNIFIC
ANT SUBSIDIARIES
INC
ORPORATION
DIREC
T PARENT
% %
Agriculture New Zealand Limited New Zealand PGG Wrightson Limited 100% 100%
AgriServices South America Limited
Ne
w Zealand
PGG
Wrightson Limited
100%

100%
Bidr Limited New Zealand PGG Wrightson Limited 100% 100%
Bloch & Behrens Wool (NZ) Limited New Zealand PGG Wrightson Limited 100% 100%
NZ Agritrade Limited New Zealand PGG Wrightson Limited 100% 100%
PGG Wrightson Investments Limited
Ne
w Zealand
PGG
Wrightson Limited
100%

100%
PGG
Wrightson Real Estate Limited
Ne
w Zealand
PGG
Wrightson Limited
100%

100%
PGG
Wrightson Trustee Limited New Zealand PGG Wrightson Limited 100% 100%
PGG
Wrightson Employee Benefits Plan Trustee Limited
Ne
w Zealand
PGG
Wrightson Limited
100%

100%
PGW Rural C
apital Limited
Ne
w Zealand
PGG
Wrightson Limited
100%

100%
A
g Property Holdings Limited
Ne
w Zealand
PGG
Wrightson Investments Limited
100%

100%
PGG
Wrightson Employee Benefits Plan Limited New Zealand PGG Wrightson Employee Benefits 100% 100%


P
lan Trustee Limited

38 | PGG WRIGHTSON LIMITED

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
27 BASIS OF PREPARATION
A. Statement of compliance
T
hese consolidated financial statements have been prepared in accordance with New Zealand Generally Accepted Accounting Practice ("NZ
GAAP"). They comply with International Financial Reporting Standards ("IFRS") issued by the International Accounting Standards Board, the
New
Zealand equivalents to International Financial Reporting Standards ("NZ IFRS") and other applicable Financial Reporting Standards, as
appropriate for a Tier 1 for-profit entity. These consolidated financial statements have also been prepared in accordance with the requirements of
the Financial Markets Conduct Act 2013 and the Financial Reporting Act 2013.
B.

B
asis of measurement
T
he consolidated financial statements have been prepared on the historical cost basis except for the following:
– Derivative financial instruments are measured at fair value.
–

F
inancial instruments at fair value through profit or loss are measured at fair value.
– Assets classified as held for sale are measured at the lower of their carrying amount and fair value less cost to sell.
C.

F
unctional and presentation currency
T
hese consolidated financial statements are presented in New Zealand dollars ($), which is the functional currency of each of the group entities. All
amounts have been rounded to the nearest thousand, unless otherwise indicated.
D.

U
se of estimates and judgements
I
n preparing these consolidated financial statements, management has made judgements, estimates and assumptions that affect the application
of the Group's accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these
estimates and assumptions.
Estimates and assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised prospectively.
Information about critical judgements made in applying accounting policies, assumptions and estimation uncertainties that have the most
significant effect on the amounts recognised in the financial statements is included in the following notes:
Note
12

C
arrying value of trade and other receivables
14
C
arrying value of inventories
16

I
mpairment of right-of-use assets
19
M
easurement of defined benefit asset/liability - Key actuarial assumptions
Management has determined that the COVID-19 pandemic has not significantly impacted the estimates and judgements used on the
consolidated statement of financial position as at 30 June 2021. Management will continue to monitor and assess the impacts of future
developments of COVID-19, which are highly uncertain and cannot be predicted, on its judgements and estimates.
PGG WRIGHTSON LIMITED | 39

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
28 OTHER SIGNIFICANT ACCOUNTING POLICIES
The accounting policies set out in these consolidated financial statements have been applied consistently to all periods presented in these
consolidated financial statements, and have been applied consistently by Group entities.
A.
B
asis of consolidation
Subsidiaries
Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect those returns through its power over the entity. The financial statements of subsidiaries are
included in the consolidated financial statements from the date on which control commences until the date on which control ceases.
Transactions eliminated on consolidation
Intra-group balances, and any unrealised income and expenses arising from intra-group transactions, are eliminated in preparing the consolidated
financial statements. Unrealised gains arising from transactions with equity accounted investees are eliminated against the investment to the
extent of the Group's interest in the investee. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there
is no evidence of impairment.
B.

F
oreign currency
Transactions in foreign currencies are translated to the respective functional currencies of the group entities at the exchange rates at the dates of
the transactions.
Monetary assets and liabilities denominated in foreign currencies are translated to the functional currency at the exchange rate at the reporting
date. Non-monetary assets and liabilities that are measured at fair value in a foreign currency are translated to the functional currency at the
exchange rate at the date that fair value was determined. Non-monetary items that are measured based on historical cost in a foreign currency
are translated to the functional currency at the exchange rate at the date of the transaction. Foreign currency differences arising are recognised in
profit or loss.
C.

D
iscontinued operation
A discontinued operations is a component of the Group's business, the operations and cash flows of which can be clearly distinguished from the
rest of the Group and which:
–

r
epresents a separate major line of business or geographic area of operations;
–
is par
t of a single co-ordinated plan to dispose of a separate major line of business or geographic area of operations; or
–
is a subsidiar
y acquired exclusively with a view to resale.
When an operation is classified as a discontinued operation, the comparative statement of profit or loss and OCI is re-presented as if the operation
had been discontinued from the start of the comparative year.
D.

A
sset held for sale
Non-current assets, or disposal groups comprising assets and liabilities, are classified as held-for-sale if it is highly probable that they will be
recovered primarily through sale rather than through continuing use. Such assets, or disposal groups, are generally measured at the lower of
their carrying amount and fair value less costs to sell. Impairment losses on initial classification as held-for-sale and subsequent gains or losses
on remeasurement are recognised in profit or loss. Once classified as held-for-sale, property, plant and equipment are no longer amortised or
depreciated.
40 | PGG WRIGHTSON LIMITED

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
28 OTHER SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
E. Disclosure of non-GAAP financial information
Non-GAAP reporting measures have been presented in the consolidated statement of profit or loss or referenced to in the notes to the
consolidated financial statements. The following non-GAAP measures are relevant to the understanding of the Group's financial performance:
–

Operating EBITD
A represents earnings before net interest and finance costs, income tax, depreciation, amortisation, results from discontinued
operations, fair value adjustments and non-operating items.
–
EBIT r
epresents earnings before net interest and finance costs, income tax and the results from discontinued operations.
–

Basic & dilut
ed EPS on issued ordinary shares at the end of the period represents the net profit after tax for the reporting period divided by the
outstanding number of shares as at the end of the reporting period.
The Directors and management believe the Operating EBITDA and EBIT measures provide useful information as they provide valuable insight
on the underlying performance of the business. They are used internally to evaluate the underlying performance of the business and to analyse
trends.
Due to the share consolidation which occurred in August 2019, the Directors and management consider the basic & diluted EPS on issued ordinary
shares at the end of the period measure facilitates a more meaningful comparison between the 2020 and 2021 income years.
These measures are not uniformly defined or utilised by all companies. Accordingly, these measures may not be comparable with similarly titled
measures used by other companies. Non-GAAP financial measures should not be viewed in isolation nor considered as a substitute for measures
reported in accordance with NZ IFRS.
F.

S
tandards issued but not yet effective
There are a number of new standards and interpretations that are issued, but not yet effective, for the year ended 30 June 2021 and have not been
applied in preparing these consolidated financial statements. These include:
–

Classification of liabilities as cur
rent or non-current (Amendments to IAS 1)
–
Oner
ous contracts - costs of fulfilling a contract (Amendments to NZ IAS 37)
–

Disclosur
e of Accounting Policies (Amendments to IAS 1)
–
D
efinition of Accounting Estimates (Amendments to IAS 8)
–
A var
iety of minor improvements to standards have been made in order to clarify various treatments of specific transactions.
The above are not expected to have a significant impact on the Group's consolidated financial statements.
PGG WRIGHTSON LIMITED | 41

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
29 RETROSPECTIVE RESTATEMENT
A. Change in accounting policy: Software-as-a Sevice (SaaS) arrangements
I
n April 2021, the IFRS Interpretation Committee (IFRIC) published an agenda decision clarifying its interpretation of how the current accounting
standards apply to the configuration and customisation costs incurred in implementing SaaS arrangements. Following this agenda decision, the
Group revised its accounting policy in relation to those costs and the new accounting policy is presented below. Comparative financial information
has been restated to account for the impact of the change. The effect of the restatement is shown in (C) to (F) and includes the derecognition
of certain previously recognised software intangible assets. In addition, the effect includes the reclassification of Short-Term Intangible Assets to
Other Current Assets.
Software-as-a-Sevice (SaaS) arrangements
SaaS arrangements are service contracts providing the Group with the right to access the cloud provider's application software over the
term of the contract. Costs incurred to configure or customise, and the ongoing fees to obtain access to the cloud provider's application
software, are recognised as operating expenses when the services are received.
Some of these costs incurred are for the development of software code that enhances, modifies, or creates additional capability to, existing
on-premise systems. Where these costs meet the definition of and recognition criteria for an intangible asset, these costs are recognised as
intangible software assets and amortised over the useful life on a straight-line basis. Judgement was applied in determining whether the
code meets the definition of and recognition criteria for an intangible asset. The estimated useful life and amortisation method is reviewed
at the end of each annual reporting period and adjusted if appropriate.
42 | PGG WRIGHTSON LIMITED

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
29 RETROSPECTIVE RESTATEMENT (CONTINUED)
B. Closing inventory valuation
T
he Group became aware that the valuation of its closing inventory for the prior periods did not fully account for entitlements for the purchase
of certain inventory products and now complies with NZ IAS 2. As a result, the Group has historically represented its closing inventory at a higher
value than that prescribed by NZ IAS 2. Comparative financial information has been restated for this. The effect of the restatement is shown in
(C) to (F).
C.

I
mpact on the consolidated statement of financial position
ADJUSTMENT $000
CLOSING RESTATED
1 JUL 2019 INVENTORY 1 JUL 2019

$000
SaaS COSTS
V
ALUATION

TOTAL
$
000
Income tax receivable – – 125 125 125
Inventories 85,969 – (3,484) (3,484) 82,485
Shor
t-term intangible assets 2,222 (2,222) – (2,222) –
O
ther current assets 35 2,222 – 2,222 2,257
D
eferred tax asset 9,976 368 – 368 10,344
I
ntangible assets
14,644

(1,313)

–

(1,313)

13,331
T
otal assets 565,554 (945) (3,359) (4,304) 561,250
Income tax payable
851

–

(851)

(851)

–
R
etained earnings/(deficit)
(218,478)

(945)

(2,508)

(3,453)

(221,931)
T
otal liabilities and equity
565,554

(945)

(3,359)

(4,304)

561,250
ADJUSTMENT $000
CLOSING RESTATED
30 JUN 2020 INVENTORY 30 JUN 2020
$000 SaaS COSTS VALUATION TOTAL $000
Income tax receivable 2,369 – 1,030 1,030 3,399
Inventories
87,111

–

(3,680)

(3,680)

83,431
Short-term intangible assets 2,056 (2,056) – (2,056) –
Other current assets
4

2,056

–

2,056

2,060
Deferred tax asset 10,292 368 – 368 10,660
Intangible assets
17,180

(1,315)

–

(1,315)

15,865
T
otal assets 459,453 (946) (2,650) (3,596) 455,857
Retained earnings/(deficit)
(223,202)

(946)

(2,650)

(3,596)

(226,798)
T
otal liabilities and equity
459,453

(946)

(2,650)

(3,596)

455,857
PGG WRIGHTSON LIMITED | 43

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
ADDITIONAL FINANCIAL DISCLOSURES
29 RETROSPECTIVE RESTATEMENT (CONTINUED)
D. Impact on the consolidated statement of profit or loss
ADJUSTMENT $000
CLOSING RESTATED
30
JUN 2020
I
NVENTORY
30
JUN 2020

$000
SaaS COSTS
V
ALUATION

TOTAL
$
000
Cost of sales (583,855) – (195) (195) (584,050)
Other operating expenses
(45,327)

(2,799)

–

(2,799)

(48,126)
Operating EBITDA 45,190 (2,799) (195) (2,994) 42,196
Depreciation and amortisation expense (29,464) 2,797 – 2,797 (26,667)
Income tax expense (2,886) 1 55 56 (2,831)
Profit from continuing operations, net of income tax
7,133

(1)

(140)

(141)

6,992
Net profit after tax attributable
to Shareholders of the Company 7,840 (1) (140) (141) 7,699
E
. Impact on basic & diluted earnings per share (EPS)
ADJUSTMENT $
CLOSING RESTATED
30 JUN 2020 INVENTORY 30 JUN 2020
$ SaaS COSTS VALUATION TOTAL $
Basic & diluted EPS on issued ordinary shares
at the end of the period 0.104 (0.000) (0.002) (0.002) 0.102
Basic & diluted EPS on issued ordinary shares


at the end of the period – continuing operations
0.094

(0.000)

(0.001)

(0.001)

0.092
Basic & dilut
ed EPS on a weighted average basis
0.050

(0.000)

(0.001)

(0.001)

0.049
Basic & diluted EPS on a weighted average basis


– continuing operations

0.045

(0.000)

(0.001)

(0.001)

0.044
F
.
I
mpact on the consolidated statement of cashflows
ADJUSTMENT $000
CLOSING RESTATED
30 JUN 2020 INVENTORY 30 JUN 2020
$000 SaaS COSTS VALUATION TOTAL $000
Net cash inflow/(outflow) from operating activities 34,227 (2,773) – (2,773) 31,454
Net cash inflow/(outflow) from investing activities (11,020) 2,773 – 2,773 (8,247)
44 | PGG WRIGHTSON LIMITED

PGG WRIGHTSON LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
For the year ended 30 June 2021
30 CAPITAL AND RESERVES
Share capital
All shares are ordinary fully paid shares with no par value, carry equal voting rights and share equally in any profit on the winding up of the Group.
Realised capital and revaluation reserve
The realised capital reserve comprises the cumulative net capital gains that have been realised. The revaluation reserve relates to historic
revaluations of property, plant and equipment.
Defined benefit plan reserve
The defined benefit plan reserve contains actuarial gains and losses on plan assets and defined benefit obligations. During the year ended 30 June
2021, an amount of $0.134m, which represents the Employee Superannuation Contribution Tax (ESCT ) on the lump sum contribution made during
the year (net of tax), was transferred from the defined benefit reserve to retained earnings (30 June 2020: Nil).
Fair value reserve
The fair value reserve comprises the cumulative net change in the fair value of equity investments elected at fair value through other
comprehensive income until the investments are derecognised or impaired.
Retained earnings/deficit
The retained earnings deficit equals accumulated undistributed profits/losses.
Dividends
The following dividends were declared and paid by the Company.
PAYMENT DATE $ PER SHARE
2021 interim dividend – fully imputed 24 March 2021 0.120
2020 interim dividend – fully imputed
3 Apr
il 2020
0.090
2019 final dividend – fully imputed 2 October 2019 0.075
Share Capital Accounting Policies
Ordinary shares
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares are recognised as a deduction
from equity.
Repurchase of ordinary shares
When shares recognised as equity are repurchased, the amount of the consideration paid, including directly attributable costs, is recognised
as a deduction from equity. Repurchased shares are cancelled. However, treasury stock for which unrestricted ownership has not yet been
transferred are not cancelled.
PGG WRIGHTSON LIMITED | 45

ADDITIONAL FINANCIAL DISCLOSURES
46 | PGG WRIGHTSON LIMITED
Balance at 1 July 2019 606,318 24,662 (11,672) (2,566) (218,478) 398,264
Adjustment to retained earnings for prior period restatement 29 – – – – (3,453) (3,453)
Amended balance at 1 July 2019

606,318

24,662

(11,672)

(2,566)

(221,931)

394,811
Total comprehensive income for the period
Profit or loss

–

–

–

–

7,698

7,698
O
ther comprehensive income
Defined benefit plan actuarial gain/(loss), net of tax
–

–

(2,838)

–

–

(2,838)
T
otal other comprehensive income
–

–

(2,838)

–

–

(2,838)
T
otal comprehensive income for the period
–

–

(2,838)

–

7,698

4,860
T
ransactions with shareholders recorded directly in equity
Contributions by and distributions to shareholders
Share repurchase and cancellation (234,000) – – – – (234,000)
Dividends to shareholders – – – – (12,564) (12,564)
Total contributions by and distributions to shareholders
(234,000)

–

–

–

(12,564)

(246,564)
Balance at 30 June 2020 372,318 24,662 (14,510) (2,566) (226,798) 153,106
Balance at 1 July 2020
372,318 24,662 (14,510) (2,566) (226,798) 153,106
Total comprehensive income for the period
Profit or loss


–

–

–

–

22,713

22,713
O
ther comprehensive income
Changes in fair value of equity instruments, net of tax

–

–

–

136

–

136
D
efined benefit plan actuarial gain/(loss), net of tax
–

–

6,926

–

–

6,926
T
otal other comprehensive income
–

–

6,926

136

–

7,062
T
otal comprehensive income for the period
–

–

6,926

136

22,713

29,775
T
ransactions with shareholders recorded directly in equity
Contributions by and distributions to shareholders
Dividends to shareholders
– – – – (9,343) (9,343)
Total contributions by and distributions to shareholders – – – – (9,343) (9,343)
Transfer to retained earnings
–

–

134

–

(134)

–
B
alance at 30 June 2021 372,318 24,662 (7,450) (2,430) (213,562) 173,538
T
he accompanying notes form an integral part of these consolidated financial statements.
PGG WRIGHTSON LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 30 June 2021
REALISED

C
APITAL AND
DEFINED
SHARE REVALUATION BENEFIT PLAN FAIR VALUE RETAINED TOTAL
CAPITAL RESERVES RESERVE RESERVE EARNINGS EQUITY
NOTE $000 $000 $000 $000 $000 $000

A member firm of Ernst & Young Global Limited
Independent auditor’s report to the Shareholders of PGG Wrightson Limited
Opinion
We have audited the financial statements of PGG Wrightson Limited (“the Company”) and its
subsidiaries (together “the Group”) on pages 1 to 46 which comprise the consolidated statement of
financial position of the Group as at 30 June 2021, and the consolidated statement of profit or loss,
consolidated statement of other comprehensive income, consolidated statement of changes in equity
and consolidated statement of cash flows for the year then ended of the Group, and the notes to the
consolidated financial statements including a summary of significant accounting policies.
In our opinion, the consolidated financial statements on pages 1 to 46 present fairly, in all material
respects, the consolidated financial position of the Group as at 30 June 2021 and its consolidated
financial performance and cash flows for the year then ended in accordance with New Zealand
equivalents to International Financial Reporting Standards and International Financial Reporting
Standards.
This report is made solely to the Company's shareholders, as a body. Our audit has been undertaken so
that we might state to the Company's shareholders those matters we are required to state to them in an
auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or
assume responsibility to anyone other than the Company and the Company's shareholders, as a body,
for our audit work, for this report, or for the opinions we have formed.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (New Zealand). Our
responsibilities under those standards are further described in theAuditor’s Responsibilities for the
Audit of the Financial Statementssection of our report.
We are independent of the Group in accordance with Professional and Ethical Standard 1International
Code of Ethics for Assurance Practitioners (including International Independence Standards) (New
Zealand) issued by the New Zealand Auditing and Assurance Standards Board, and we have fulfilled our
other ethical responsibilities in accordance with these requirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Ernst & Young provides taxation services to an entity not controlled by but related to the Group.
Partners and employees of our firm may deal with the Group on normal terms within the ordinary
course of trading activities of the business of the Group. We have no other relationship with, or interest
in, the Group.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the consolidated financial statements of the current year. These matters were addressed in the
context of our audit of the consolidated financial statements as a whole, and in forming our opinion
thereon, but we do not provide a separate opinion on these matters. For each matter below, our
description of how our audit addressed the matter is provided in that context.

A member firm of Ernst & Young Global Limited
We have fulfilled the responsibilities described in theAuditor’s responsibilities for the audit of the
financial statements section of the audit report, including in relation to these matters. Accordingly, our
audit included the performance of procedures designed to respond to our assessment of the risks of
material misstatement of the financial statements. The results of our audit procedures, including the
procedures performed to address the matters below, provide the basis for our audit opinion on the
accompanying consolidated financial statements.
Collectability of trade andGoreceivables
Why significantHow our audit addressed the key audit matter
At 30 June 2021 trade andGoreceivables
total $167.3m, representing 37% of Group
total assets. This amount is net of the
provision for impaired debtors andGo
receivables of $3.0m.
We consider this to be a key audit matter
because trade andGo receivables are a
significant component of Group assets and the
provision for impaired debtors involves
significant judgement.
Disclosures in relation to trade andGo
receivables and their provisions for
impairment are included in notes 12 and 13 to
the Group financial statements.
Our audit procedures included the following:
•obtained an understanding of management’s
receivables provisioning process;
•assessed management’s provisioning methods
and whether they comply with NZ IFRS 9;
•considered the inputs, assumptions and
estimates used or made by management;
•tested the ageing of receivables by agreeing
the recorded ageing of a sample of trade
receivables to sales documentation;
•considered beef and sheep meat commodity
price movements up to and after balance date
to assess whether these changes, which are
indicative of changes in value of livestock
security held forGo receivables, indicated any
material increase in the credit risk ofGo
receivables;
•considered the appropriateness and
sufficiency of the disclosures related to trade
andGo receivables and the related
provisioning.
Inventory valuation
Why significantHow our audit addressed the key audit matter
Inventory is carried at the lower of cost and
net realisable value. At 30 June 2021
inventory totals $81.5m, representing 18% of
the Group’s total assets. This amount is net of
a provision for inventory write down of $1.6m.
This is a key audit matter because inventory is
a significant component of Group total assets
and the assessment of the net realisable value
of slow moving, excess and obsolete inventory
involves significant judgement.
Our audit procedures included the following:
•compared a sample of recorded inventory cost
to supplier invoices;
•assessed the inputs into, and calculation of,
adjustments to inventory value to take
account of variable pricing arrangements with
suppliers. We also assessed the impact of this
matter at 30 June 2020 and 2019 and the
resulting restatement to the prior period
financial statements;

A member firm of Ernst & Young Global Limited
Why significantHow our audit addressed the key audit matter
Disclosures in relationto inventoryand
inventory provisions are included in note 14
and in relation to the restatement of prior year
inventory values are included in note 29 to the
Group financial statements.
•consideredthe methods,models, and
assumptions used by management in
estimating the net realisable value of slow
moving, excess, and obsolete inventory;
•considered the key inputs into the provision
calculation including last purchase date, last
sale date and volume of sales in the year for
selected product lines. We tested these inputs
into the provision calculation, including
agreeing a sample of inventory items:
•last purchase date and last sale date to
supporting invoices;
•recalculating the annual sales volumes
recorded in the inventory system;
•compared the cost of a sample of inventory
items to their most recent selling price;
•considered the extent of inventory items sold
at negative margins in the year;
•considered the appropriateness and
sufficiency of disclosures related to the
valuation of inventory, included those related
to the restatement of prior year inventory
values.
Other matter
The financial statements of PGG Wrightson Limited for the year ended 30 June 2020 were audited by
another auditor who expressed an unmodified opinion on those statements on 17 August 2020.
Information other than the financial statements and auditor’s report
The Directors of the Company are responsible for the Annual Report, which includes information other
than the consolidated financial statements and auditor’s report which is expected to be made available
to us after the date of this auditor’s report.
Our opinion on the consolidated financial statements does not cover the other information and we do
not express any form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the
other information and, in doing so, consider whether the other information is materially inconsistent
with the consolidated financial statements or our knowledge obtained during the audit, or otherwise
appears to be materially misstated.
When we read the Annual Report, if we conclude that there is a material misstatement therein, we are
required to communicate the matter to those charged with governance and, if uncorrected, to take
appropriate action to bring the matter to the attention of users for whom our auditor’s report was
prepared.

A member firm of Ernst & Young Global Limited
Directors’ responsibilities for the financial statements
The Directors are responsible, on behalf of the entity, for the preparation and fair presentation of the
consolidated financial statements in accordance with New Zealand equivalents to International Financial
Reporting Standards and International Financial Reporting Standards, and for such internal control as
the Directors determine is necessary to enable the preparation of financial statements that are free
from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, the Directors are responsible for assessing on behalf
of the entity the Group’s ability to continue as a going concern, disclosing, as applicable, matters
related to going concern and using the going concern basis of accounting unless the Directors either
intend to liquidate the Group or cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements
as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s
report that includes our opinion. Reasonable assurance is a high level of assurance but is not a
guarantee that an audit conducted in accordance with International Standards on Auditing (New
Zealand) will always detect a material misstatement when it exists. Misstatements can arise from fraud
or error and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these consolidated financial
statements.
A further description of the auditor’s responsibilities for the audit of the financial statements is located
at the External Reporting Board’s website: https://www.xrb.govt.nz/standards-for-assurance-
practitioners/auditors-responsibilities/audit-report-1/. This description forms part of our auditor’s
report.
The engagement partner on the audit resulting in this independent auditor’s report is Bruce Loader.
Chartered Accountants
Christchurch
16 August 2021

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Template
Distribution Notice

Updated as at 18 December 2019



Please note: all cash amounts in this form should be provided to 8 decimal places

Section 1: Issuer information
Name of issuer PGG Wrightson Limited
Financial product name/description Ordinary shares
NZX ticker code PGW
ISIN (If unknown, check on NZX
website)
NZREIE0001S4
Type of distribution
(Please mark with an X in the
relevant box/es)
Full Year X Quarterly
Half Year Special
DRP applies
Record date 10/09/2021
Ex-Date (one business day before the
Record Date)
09/09/2021
Payment date (and allotment date for
DRP)
4/10/2021
Total monies associated with the
distribution
1

$12,077,453.28000000
Source of distribution (for example,
retained earnings)
Retained earnings
Currency NZD
Section 2: Distribution amounts per financial product
Gross distribution
2
$0.22222222
Gross taxable amount
3
$0.22222222
Total cash distribution
4
$0.16000000
Excluded amount (applicable to listed
PIEs)
N/A
Supplementary distribution amount $0.02823529
Section 3: Imputation credits and Resident Withholding Tax
5

Is the distribution imputed Fully imputed
Partial imputation
No imputation

1
Continuous issuers should indicate that this is based on the number of units on issue at the date of the form
2
“Gross distribution” is the total cash distribution plus the amount of imputation credits, per financial product, before the deduction of
Resident Withholding Tax (RWT).
3
“Gross taxable amount” is the gross distribution minus any excluded income.
4
“Total cash distribution” is the cash distribution excluding imputation credits, per financial product, before the deduction of RWT.
This should include any excluded amounts, where applicable to listed PIEs.
5
The imputation credits plus the RWT amount is 33% of the gross taxable amount for the purposes of this form. If the distribution is
fully imputed the imputation credits will be 28% of the gross taxable amount with remaining 5% being RWT. This does not constitute
advice as to whether or not RWT needs to be withheld.