Ann: PGL Trading Update - 4Q21, page-3

The revenue growth was impressive but disappointing that it wasn't enough to make a profit.

FWIW, Macquarie doesn't see the business turning a profit for the duration of its forecast period to end-FY2023. It values PGL at $1.25 and rates neutral.

However the biggest concern is that the lockdowns around Australia look like extending for several weeks if not months. Given that there is nothing as substantial as Jobkeeper in place, its hard to see how small businesses (especially the sort that PGL lends to) are going to manage debt repayments. I doubt that bad debt provisioning at end-June properly takes into account the rapidly evolving / deteriorating covid situation that has emerged in July.

It's a good business, but I think that Q4-FY21 is going to end up much stronger than Qs 1 and 2 in FY22.

Looks like more downside than upside risk over the next two quarters.