Shares in S&P/ASX 200 Index (ASX: XJO) crop protection and seeds company Nufarm Ltd (ASX: NUF) are soaring on the release of its first-half earnings.
Right now, the stock is up 14.53%, trading for $6.07 apiece.
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ASX 200 share Nufarm rockets as dividend bumped 25%
Here are the key takeaways from the company's results for the six months ended 31 March:
- Revenue slumped 1% on the prior comparable period (pcp) to $2 billion
- Underlying net profit after tax (NPAT) lifted 7% to $142 million
- Statutory NPAT, meanwhile, surged 51% to $149 million
- Underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) fell 4% to $316 million
- Unfranked 5 cents per share interim dividend declared – a 25% jump on the pcp
What else happened last half?
The ASX 200 company's crop protection segment performed well in Europe, while its underlying EBITDA slipped in the Asia-Pacific region and North America.
Underlying EBITDA came up 7% higher in Europe at 81 million Euros on revenue of 320 million Euros – a 1% increase. That was thanks to new products and a favourable product mix.
Underlying EBITDA came to $71 million in the Asia-Pacific, a 28% fall on the pcp's record high, while revenue slumped 6% to $546 million. In North America, the company's underlying EBITDA fell 16% to US$57 million on revenue of US$454 million – a 12% drop.
Finally, the company's Seed Technologies segment saw its revenue jump 25% to $231 million and its underlying EBITDA lift 34% to $62 million.
It also achieved key milestones in bioenergy. The first shipment of carinata grain, an oilseed used to replace fossil fuels, was delivered to Saipol for processing under a 10-year offtake and market development agreement with energy giant bp.
What did management say?
Nufarm managing director and CEO Greg Hunt commented on the news driving the ASX 200 share today, saying:
This is an excellent result, that 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.
Global conditions remain positive, with agricultural commodity prices at or above five-year averages.
What's next?
The company has left its earnings outlook for financial year 2023 unchanged. It still expects to post modest underlying EBITDA growth on a constant currency basis, assuming normal seasonal conditions.
It remains on track to meet or exceed its aspiration to post $600 million to $700 million of revenues at 20% to 25% EBITDA by financial year 2026.
Nufarm share price underperforms ASX 200
Sadly, today's gain hasn't proven enough to boost the Nufarm share price back into the longer-term green.
The stock has slumped 2% since the start of 2023. It has also dumped 10% since this time last year.
Comparatively, the ASX 200 has risen 4% year to date and 1% over the last 12 months.
