Nuseed Australia production managers Andrew Todd, Bryan Matuschka and Ben Byrnes in a paddock of seed HyTTec Trident canola grown by Frank Dal Bon in NSW’s Riverina district. Photo: Nuseed

AUSTRALIAN-based global crop protection and seed technology company Nufarm has posted a profit for the year to September 30 of $111 million, up 3 percent on its FY22 result.

In results released this week, Nufarm said its reported underlying earnings before interest, taxation,depreciation and amortisation of $438M, down 2pc on the previous year.

“This is a strong result on the back of a record prior period,” Nufarm managing director and CEO Greg Hunt said.

“The result has been driven by Nufarm’s transformed structure and increasing shift to innovative and differentiated solutions.”

“Our diverse portfolio and geographic footprint provide earnings stability and resilience, while our omega 3 and bioenergy platforms provide significant growth potential.”

Mr Hunt said the outlook for Nufarm was positive.

“Global grain and oilseed stocks-to-use ratios remain tight and grain prices remain attractive, supporting grower plantings and demand for crop-protection products.

“In FY24, we expect continued momentum in new crop-protection product launches, accelerating through FY25 and beyond, and continuing strong growth in Seed Technologies.

“We expect trading to remain challenging in the first half as the industry adjusts to a lower level of input cost and prices and for Nufarm to return to growth in the second half of fiscal 24.”

Crop protection dips

The global market for crop protection products was described by Nufarm as challenging in FY23, and total crop-protection sales revenue fell 6pc from FY22.

“There was widespread channel destocking resulting from higher interest rates and expectations of falling active ingredients prices,” Nufarm said in a statement.

“These impacts were most pronounced in foundational products and led to reduced sales for Nufarm across all regions.”

Nufarm said the industrial sales business experienced reliability issues at its UK plant in Wyke, Yorkshire, which affected plant availability and manufacturing costs, but strong outcomes from new-product introductions helped mitigate these impacts.

“During the period we continued to invest in our new product pipeline as well as plant and supply chain efficiency with significant investment into Wyke and Chicago Heights.”

Seeds the stand-out

Seed Technologies from Nufarm’s Nuseed subsidiary were the star performer in FY23, with revenue of $393M up 33pc on the FY22 figure.

“Increased revenue from seed sales reflected stronger demand for hybrid canola varieties in Australia, South America and Canada; sorghum in Brazil, USA and other international markets; and sunflower in key global markets.”

Underlying EBITDA of $98M was up 67pc, reflecting strong growth in Nufarm’s base seeds business as well as license revenues in its Seed Technologies portfolio.

Mr Hunt said the outlook for Nufarm was positive.

“Global grain and oilseed stocks-to-use ratios remain tight and grain prices remain attractive, supporting grower plantings and demand for crop-protection products.

“Our balance sheet is strong and we have a clear growth strategy.

“In FY24, we expect continued momentum in new crop-protection product launches, accelerating through FY25 and beyond, and continuing strong growth in Seed Technologies.

“We expect trading to remain challenging in the first half as the industry adjusts to a lower level of input cost and prices and for Nufarm to return to growth in the second half of fiscal 24.

Nufarm is a global crop protection and seed technology company established over 100 years ago and its headquarters are located in Melbourne.

Nufarm is focused on innovative crop protection and seed technology solutions. Nufarm is the first company to develop and commercialise plant-based Omega-3 and has developed and commercialised advanced bioenergy feedstock technology

Source: Nufarm