Nufarm (NUF) produces agricultural fertilisers and chemicals used for crop protection internationally.

The company is also actively involved in the marketing and sale of branded, off-patent crop protection and seeds treatment products.

NUF was one of the shares to sell during the first half of 2010 amid poor results and earnings downgrades.

On 29 March, NUF reported a 1H11 operating net profit of $22.7 million.  This compares to an operating loss of $4.2 million loss a year earlier.

Including one-off costs and write-downs, Nufarm’s net loss came in at $40 million.  No interim dividend was declared.

Excluding glyphosate sales, group revenue rose 15% on-year to $694 million.  This was associated with a healthier gross margin as NUF sought to optimise its sales mix.

NUF was confident that positive climatic conditions in Australia and an improved operating environment will deliver a full year result significantly better than the prior year.

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Nufarm (NUF) produces agricultural fertilisers and chemicals used for crop protection internationally, with less than half its sales coming from Australia.

The company is also actively involved in the marketing and sale of branded, off-patent crop protection and seeds treatment products.

Recently, NUF announced that FY10 net profit is expected to come within its previous guidance of $55 million – $65 million.

Worryingly, however, net debt of $620 million was much higher than previous estimates of $450 million, due to increased working capital levels.

The higher debt levels means NUF is now in a minor breach of one of its loan covenants, however the breach will be covered by the waivers currently being put in place.

Nevertheless, NUF was one of the shares to sell following the profit announcement, plunging 6.8% in a day when the stock market jumped over 2%.

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Nufarm Ltd (NUF) is a crop protection company, with operations spanning the globe.  It aims to produce products designed to protect crops from damage caused by weeds, pests and disease.

Late yesterday, NUF lowered its FY10 net profit guidance to $55 million – $65 million, from the previous $110 million – $130 million.

This follows on from previous downgrades, meaning NUF has been one of the key shares to sell in recent months.

NUF based its downgrade on weak seasonal conditions resulting in poor demand for its crop protection products.

As a result of a weak operating environment, NUF stated that it was facing added margin and price pressures.

Although NUF remained in a trading halt throughout the day of the announcement, it was one of the worst performing stocks in the Australian share market today.

NUF will remain will also remain one of the stocks to watch over coming months to see if management can turn the company’s fortunes around.