11th October 2001
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Media Release
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Nufarm releases 2001 profit result; predicts solid profit growth for 2002
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After reporting a flat operating profit for 2001, Nufarm Limited today said it is strongly
positioned to achieve double digit profit growth in the current year.
For the 12 months ended July 31, 2001, Nufarm reported an operating profit of $51.1
million. The group’s full year final result was a loss of $4.5 million, after taking into
account non-operating items, including a $59.2 million write-off associated with the
company’s loss making Sulfer Works business in Canada.
The result was in line with the most recent forecast provided by Nufarm in July, when
the Sulfer Works write-off was announced.
Group sales increased by 9% on the previous year to $1.32 billion, a record for the
company over any 12 month period. It was also the first year in which revenues from
Nufarm’s overseas based businesses (54%) exceeded those of the Australian and
New Zealand based operations (46%).
Nufarm’s Managing Director, Mr Doug Rathbone, said the 2001 performance
included profit growth from most of the company’s major business divisions, but had
been held back by a poor performance from the Australian crop protection business.
“The margins in that business were impacted by factors relating to industry
rationalisation, with Nufarm having to defend its position of industry leadership.
“While many of those factors continue to put pressure on our Australian business, we
have identified a number of measures to rebuild profitability within the 2002 financial
year,” Mr Rathbone said.
Excellent growth was achieved in the company’s North American crop protection
operations with a 22% increase in sales for the combined agriculture, and turf and
specialty sectors.
“Despite difficult trading conditions in some of the markets into which Nufarm’s
industrial, fine and performance chemicals are sold, this division recorded a 33%
increase in pre tax operating profit. With the divestment of several businesses during
the year, this was achieved on lower overall sales”.
Mr Rathbone said the decision to write-off the Sulfer Works business in Canada had
been taken after a comprehensive management review indicated the business would
continue to suffer significant cash losses for at least three more years.
“The Board was not prepared to allow those losses to continue impacting the
performance and growth of the company and to be an ongoing distraction from the
core business.
“The company is now strongly positioned to return to profit growth in the current year.
Despite the current international uncertainty, we have a resilient business and
substantial opportunities in terms of further geographic expansion, the introduction of
new products and increased earnings from existing operations.”
Nufarm announced a fully franked final year dividend of 11 cents per share, bringing
the full year dividend to 18 cents.
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Further information:
Robert Reis
Corporate Affairs
Phone (61 3) 9282 1177
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