Nufarm (NUF) says it expects to post earnings within the lower half of its previously stated guidance as unfavoury hot and dry weather conditions impact on its domestic business.
In a statement to the Australian Securities Exchange, the agricultural chemical company confirmed it expected to report earnings before income and tax for the six months to January 31 of between $50 million and $60 million, "albeit towards the lower end of that range".
Nufarm said unfavourably hot and dry weather in key Australian growing regions during December and January had resulted in "unusually low" sales of sorghum and sunflower products, contributing to depressed margins.
However the group expected its first-half earnings to be broadly in line with the previous year, with other parts of its business – particularly in Brazil – expected to contribute an "excellent" first-half result.
Operations in Europe, North America and Asia were also in line with expectations, Nufarm said.
The group said it "continues to assess options for improving the profitability of the Australian business and the returns generated during periods of unfavourable climatic conditions" and that its domestic operations were "well positioned to continue generating earnings growth on a full-year basis".
Nufarm will report on earnings for the six months to January 31 on March 26.