Craig Norgate has dismissed persistent rumours he is in poor health but the same cannot be said for the share value of two companies in which he is involved reports The ODT. Rural servicing company PGG Wrightson, which he chairs, and New Zealand Farming Systems Uruguay, in which PGG Wrightson is the second largest shareholder and Mr Norgate a director, were the two worst performing stocks on the New Zealand Stock Exchange top 50 for December. Brokers Forsyth Barr said New Zealand Farming Systems Uruguay (NZFSU) lost a third of its value last month and PGG Wrightson (PGG-W) 20%. NZFSU also led the pack in three and six month performance assessments with losses in value of 52.8% and 65.5% respectively, and was third worst for the 12-month period, losing 63%. It has been a tough year for Mr Norgate and his companies. The credit crunch prevented PGG-W from completing a ground-breaking partnership with meat company Silver Fern Farms (SFF), although Mr Norgate said he hoped to resurrect aspects of that deal. He confirmed the parties were still in talks over the payment of penalties for not completing the transaction. It also saw the downgrading late last year of its full-year profit forecast, before abnormals, from a $46 million-$51 million range to $39 million-$45 million, citing a weak performance from its real estate division. In addition, the company faced a number of one-off items which will impact on its half-year result to be announced next month. That could include a $28 million write-down in the value of NZFSU, as well as costs associated with terminating the SFF deal. "Direct costs could be as high as $10 million and then there are potential damages for non-performance." This prompted Forsyth Barr to downgrade PGG-W earnings forecast before interest and tax (Ebit) for the 2008-09 year by 11.4% to $88.2 million. "With a fully geared balance sheet and relatively volatile core earnings, we continue to maintain our reduce recommendation." It revalued the stock at $2.12, down from $2.29. Shares are trading at $1.30.
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