The projected net operating earnings have been revised by PGG Wrightson, which fell by 16% to $30-32 million, a drop on its previous forecast of $36-42 million. The company witnessed pressure on margins due to global recession and the slump in dairy prices.

The rural services company has experienced the effect of the collapse in dairy markets, which has seen dairy prices halve in the last year.

If adhered to the company then its resilience in the first half of the year has not been matched in the second half, the company's peak trading season. The current year quarter has been facing tough time, with farmers reaching new expenditure with extreme caution in light of Fonterra's revised payout projection of $5.20 for the current season, and $4.55 projected for next year.

Improvement has been noticed in sheep and beef farm incomes to their best levels in recent years; however this has not been reflected in expenditure which, similar to dairy farmers, has been kept to a minimum given the past poor returns.

"The net earnings for the year to June 30 2009 are still beholden to the effects of non-trading items, such as any further write-down in Farming Systems Uruguay, which has seen earnings shattered by drought and commodity markets," said a source.

A sum of $35.2 million was related to the company's 11% shareholding in NZ Farming Systems Uruguay (NZS), within that figure and $9.3 million to the 'marking to market' of open contracts hedging foreign currency and interest rate exposures under IFRS.

Silver Ferns Farm merger which was dropped by company indicated that the company's compensation and other expenditure relating to the SFF transaction was $17 million, following medication.

As of now, the company is finding ways to manage its debt levels.