Home' Otago Southland Farmer : January 25th 2013 Contents 25.1.13 Farmer
In a world first, a pasture that is able to withstand
attack from New Zealand's most serious pasture
insect pests will be on the market from this
It's called Barrier ComboTM and it is a ready-to-
sow perennial pasture mix containing a unique
new endophyte, "GrubOUT U2". It withstands
attack from insect pests such as grass grub, black
beetle, Argentine stem weevil and porina.
The big advantage of the endophyte in practical
terms is improved pasture persistence potential.
For farmers who have become exasperated at
having grass grub and black beetle wipe out their
pastures after as little as 12-18 months, the
endophyte will be great news.
Full information can be found on our website
www.grubout.co.nz or www.cropmark.co.nz ; or
give me a call.
Interest nationwide has been huge since we
made the announcement back in October.
Being its first year of commercialisation, seed
supplies will be relatively limited.
If you are interested in this exciting new
technology you should contact your seed supplier
soon to secure supplies.
For those farmers who usually sow their
pastures in spring, we can hold seed over until
then -- but you will need to talk to your seed
supplier soon to arrange this.
231 Morris Road, Mosgiel
Trade me Reference number 9920ME
Luxury Lifestyle 15ha on the hill, two minutes from Mosgiel
You will feel the privacy and tranquility as soon as you enter the tree lined driveway
to the top of the property. With the extensive use of glass this two year old home
boasts all day sun and expansive rural views.
Designed to impress and accommodate the most discerning buyer. Four king size
bedrooms (2 with ensuites), plus third bathroom with separate w/c, office, open plan
kitchen/dining/lounge plus an adjacent formal lounge. Deck extends the length of the
house with a large fully covered entertainment
area and spa pool.
Suitable for grazing and / or rearing cattle,
sheep or horses.
-- Metro Realty Limited -- 021 954 588
Interest coverage a gauge for banks
If you are dealing with banks, and
who isn't, you will come across
interest coverage as one of the
measures that holds some weight
when it comes to diagnosing financial
You can actually do the calculation
yourself or ask your banker because it
will most likely have been done.
What does it all mean? Technically it's
EBIT divided by interest costs.
EBIT is earnings before interest and tax
and we all know what interest costs are.
To calculate an EBIT, take your gross
income and subtract any one-off item
that won't recur, taking down some trees
for example. Mind you, if your business
is forestry you leave it in.
Next, work out if your stock number
increases or decreases, at market value,
if it's up add it and if it's down subtract it.
Next, add back all interest, principal,
capital expenditure and tax. If you are
adding back capital expenditure, you
need to deduct depreciation to allow for
the cost of ongoing cost to maintain the
assets. You will find the total
depreciation in the annual accounts.
This gives the EBIT figure. Then you
divide it by the interest costs, again in
your annual account, and you will come
up with the interest coverage.
Sounds complicated, but it's not and
gives you a measure of financial
Here's an example, budget surplus is
$30,000, add back extra hoggets kept
($9000), add back interest ($65,000) and
principle ($10,000) and tax ($5,000) and
capital expenditure ($15,000), deduct
EBIT is $116,000. Interest is $65,000,
divide EBIT by interest and get an
interest coverage of 1.78.
A 1.78 is pretty healthy. If you get down
below 1.4 a banker will be looking pretty
closely at things.
And if you can't be bothered doing these
figures, increase interest costs by 3 per
cent and see if you still have a surplus
If not, get the pencil, annual accounts
and current budget out.
Brits visit top Athol Valley farm
Representatives from Sainsbury's among exchange programme group
By SUE FEA
Top farmer: Athol farmer Steve
Wilkins won a Nuffield scholarship.
An agricultural team from British
supermarket chain Sainsbury's
will visit a successful Athol
Valley farm next month as part of
a tour of Southland export lamb
Alliance Group is hosting the tour
and general manager of market-
ing Murray Brown said Steve and
Heather Wilkins' property was
chosen as one of its 100 or so
Sainsbury's group suppliers
because they were "top quality
Representatives from two of
Sainsbury's agricultural proces-
sors, Dunbia and Randall Parker
Foods, will be travelling with the
Two British farmers, who were
part of a new exchange pro-
gramme between the two coun-
tries, will travel with the group to
study New Zealand farming.
Alliance is also showcasing its
revolutionary newly released
Hoofprint software during the
As members of Alliance's Sain-
sbury's producer group, the
Wilkins are using the new web-
based, farmer-friendly pro-
gramme which keeps tabs on
environmental, on-farm, carbon
The scientific model was devel-
oped by a Dunedin company and
produces farm performance infor-
mation based on data collected to
determine the carbon footprint,
including measuring water and
It helps suppliers measure and
monitor agricultural greenhouse
gases associated with their farms
and improve their productivity.
The world first for sheepmeat
farming would be used to
benchmark New Zealand farmers
against those offshore and the
visiting group would be studying
its implications, Mr Brown said.
Alliance Group supplies about 70
per cent of New Zealand's export
lamb business to Sainsbury's.
"They are our biggest individual
customer of chilled lamb."
Mr Wilkins will not be there for
the February 3 Sainsbury visit.
He left last week for Britain as
part of the Nuffield Scholarship
programme, one of just five New
Zealand farmers named in the
programme for 2013.
He will study crop farming in
Britain on the first month of
overseas travel planned this year
as part of his $50,000 scholarship.
Mr Wilkins will also attend an
international Nuffield Scholars'
conference in Toronto, Canada, in
March, with high-profile policy
makers from the United States
The couple are renowned for
diversifying their business,
launching The Vege Shed, a
successful retail business devel-
oped in a transformed wool shed
at their farm gate.
They sell their export-quality
meat, homegrown vegetables and
preserves from the business,
which was launched after their
children made $800 in eight weeks
one winter selling swedes at their
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