Nufarm shares to take hit as profit forecast is halved

In what is the company's fifth profit downgrade in a row, Nufarm said it expected full-year net operating profit, excluding material items, to be between $55 million and $65 million, compared with between $110 million and $130 million as forecast at the company's half-year results in March.

Nufarm said unfavourable weather worldwide contributed to poor demand for its crop protection products, which in turn led to increased competition and price pressure.

Managing director Doug Rathbone denied he could have informed shareholders sooner, given he received the company's crucial June figures yesterday.

"It's quite normal for the company to be generating a very high proportion of annual profit in those final three months of the financial year," he said. "The fact is that until we started to see the results that became apparent yesterday, we still believed we had every opportunity of achieving guidance."

Mr Rathbone said the extent to which guidance was missed was "cause for real concern", and that the company will take "a very close look" at its forecast and information systems.

Shares in Nufarm, which last traded at $5.24, are expected to plummet when it is lifted from its trading halt this morning.

Nufarm was forced to respond to queries from the Australian Securities Exchange in March after delivering a shock profit downgrade, following a similar request last September after announcing it would miss guidance by up to 15 per cent.

Yesterday's announcement follows Tuesday's sudden resignation of long-standing chairman Kerry Hoggard, who cited poor health. He has been replaced by former Telstra chief executive Donald McGauchie, who said he will review the strategic direction of the company.