Nufarm Revenue Rises on North America Strength

Australia’s Nufarm Limited on Wednesday reported revenue growth and a net profit of $12 million for the six months ended Jan. 1, powered by strong sales in North America, Europe, Asia, and in the company’s seeds business.

The company is forecasting earnings growth for the full year, with “good sales momentum in most of its major markets and further benefits to be secured from its business improvement program.”

First-half earnings were impacted by production interruptions due to the planned upgrade of its Laverton manufacturing plant and challenging operating conditions in Brazil.

Nufarm Managing Director and CEO Greg Hunt said the first half of the year saw continued execution of the company’s growth strategy, including progress on business transformation projects, the successful acquisition of two product portfolios that will significantly strengthen its European operations; and the Australian regulatory approval of its proprietary Omega-3 canola.

“We are nearing the end of the heavy lifting in terms of cost-out, business change and transformation investment and we are confident we will deliver the $116 million in performance improvement that we promised the market by the end of this financial year,” Hunt said.

He added: “Under our strategy, we’ve focused on core crops and geographies, giving us depth over breadth in our key markets. This strategy is working, with double-digit revenue growth in a number of our regional market hubs around the world.”

Hunt said the recently completed European product acquisitions are now being integrated into the business, with recruitment of new marketing and sales resources and sourcing arrangements for the new products being established.
“These product portfolios strengthen the company’s position in our core crops and key markets in Europe, and provide additional scale that will make Nufarm more relevant to our customers.”
The company expects a positive second half performance in Australia, North America and Europe, driven by revenue growth and cost savings benefits. The Latin America business will, however, be challenged by a continuation of difficult market conditions in Brazil and dry conditions in Argentina, with earnings expected to be in line with the prior period. An optimistic outlook for the Australian canola season, combined with new seed product launches and higher seed treatment sales, should deliver solid earnings growth for the seed technologies segment over the full year.

 

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