RURALCO HOLDINGS LIMITED (RHL)



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General Information
Company Name: Ruralco Holdings Limited
Stock Code: RHL
Website: www.ruralco.com.au
GICS Sub-Industry: Diversified Commercial & Professional Services
Market Cap ($M): 182
Equiv. Shares (M): 55

Current Price Data+
Current Price Open High Low Last Close Volume Price Movement
$ 3.300 $ 3.250 $ 3.300 $ 3.250 $ 3.300 4,675 0%

Current Broker Consensus Recommendation more
Recommendation: Buy
Recommendation Date: 23rd May 2013
12 Month Target Price (average): $3.55
Brokers Surveyed: 1

Company Overview

Business Description:
Ruralco Holdings Limited (RHL) is an agribusiness company operating under its own brands in Australia. RHL operates through a national footprint of businesses that specialise in providing rural customers with products and services including merchandise, fertiliser, seed, wool, livestock, real estate, stock feed, risk management, water, grain, finance and insurance. RHL has over 500 outlets across Australia.

Strategy Analysis:
RHL's point of differentiation is its local service, knowledge and independence. Its businesses around the country operate under their own brands. They have their own cultures, service models and value propositions. This is designed to meet the demands of their local or regional markets and to make the most of their own conditions and opportunities. RHL is focussed on improving the efficiency of operations, organically growing profits from existing businesses and diversifying operations across geographies and sectors. Ruralco Holdings reported NPAT down 7.54% to $13.85m for the year ended 30 September 2012. Revenue from ordinary activities were $1,136.31m, up 13.3% from last year. Diluted EPS was 25.12 cents compared to 26.83 cents last year. Net operating cash flow was $15.35m compared to $53.04m last year. The final dividend declared was 10 cents, taking the full year dividend to 20 cents compared with 18 cents last year.


Financial Summary
Year to Sep NPAT EPS EPS chg (%) PER DPS Yield (%) Franking (%)
2014  F 17.1 31.2 16.0 10.6 22.1 6.7 --
2013  F 14.7 26.9 7.2 12.3 20.0 6.1 --
2012  A 13.8 25.1 -6.3 13.0 20.0 6.1 100.0
Source: Aspect actuals / Thomson IBES estimates

Peer Comparison
EPS Growth (%) P/E (%) Dividend Yield (%)
Company Mkt Cap 2012 A 2013 F 2014 F 2012 A 2013 F 2014 F 2012 A 2013 F 2014 F
Brambles (BXB) $14,530 M 0.2302 0.0345 0.1664 22.6787 21.9220 18.7953 0.0279 0.0300 0.0322
Downer EDI (DOW) $1,469 M -0.3684 0.1496 0.0677 7.9765 6.9382 6.4980 0.0000 0.0606 0.0730
Mineral Resources (MIN) $1,572 M 0.1078 0.0347 0.2662 8.8177 8.5216 6.7299 0.0544 0.0580 0.0710
McMillan Shakespeare (MMS) $1,182 M 0.2107 0.1166 0.1833 21.4035 19.1685 16.1985 0.0296 0.0325 0.0385
Ruralco Holdings (RHL) $187 M -0.0637 0.0697 0.1604 13.4952 12.6163 10.8724 0.0590 0.0590 0.0650

Market Comparison
Earnings P/E Ratio P/B Ratio P/E Growth P/S Ratio
RHL 1.01 12.5 1.16 1.10 0.16
Market 0.80 13.9 1.17 1.90 1.62
Sector 0.62 9.85 1.14 1.41 0.56

Directors
Name Position Start Date
Mr Richard A F England Chairman 09 July 2002
Mr John Steven Maher Chief Executive Officer,Managing Director 02 October 2006
Mr Bruce Robert Dixon Non-Executive Director 16 February 2012
Michele Allan Non-Executive Director 15 March 2012
Mr Shane Michael Smith Non-Executive Director 15 December 2009
Mr Michael John Millner Non-Executive Director (other) 01 September 2003

Management
Name Position
Angie Somann-Crawford Company Secretary,General Counsel
Peter Homann General Manager - Agency
Ian Armstrong General Manager - Credit, Compliance & Risk
Greg O'Neil General Manager - CRT, Marketing & Communication
Travis Dillon General Manager - Mainland Operations
Rick Maybury General Manager - Rural Supplies
Michael Cullinan General Manager - Sector Operations
Allan Barr General Manager - Tasmanian Operations
Rachel Cofrancesco Group Human Resources Manager

Substantial Shareholders
Holding Name
12,958,775 (23.55%) Washington H Soul Pattinson and Co Ltd
14,481,148 (26.32%) Neale Edwards Pty Ltd

Calendar of Events
Date Event
20 May 2014 Report (Interim)
20 December 2013 Report (Annual)
19 November 2013 Report (Prelim)
28 June 2013 Div Pay Date
© 2011 Morningstar, Inc. All rights reserved. The data and content contained herein are not guaranteed to be accurate, complete or timely. Neither Morningstar, nor its affiliates nor their content providers will have any liability for use or distribution of any of this information. To the extent that any of the content above constitutes advice, it is general advice that has been prepared by Morningstar Australasia Pty Ltd ABN: 95 090 665 544, AFSL: 240892 (a subsidiary of Morningstar, Inc.), without reference to your objectives, financial situation or needs. Before acting on any advice, you should consider the appropriateness of the advice and we recommend you obtain financial, legal and taxation advice before making any financial investment decision. If applicable investors should obtain the relevant product disclosure statement and consider it before making any decision to invest. Some material is copyright and published under licence from ASX Operations Pty Limited ACN 004 523 782 ("ASXO"). DISCLOSURE: Employees may have an interest in the securities discussed in this report. Please refer to our Financial Services Guide (FSG) for more information at www.morningstar.com.au/fsg.asp.

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