Syngenta posts 11 percent drop in first-half profitGENEVA — Agrochemicals company Syngenta AG reported an 11 percent decline in first-half net profit on Thursday, and lowered its full-year outlook after a slow start to the planting season.
GENEVA — Agrochemicals company Syngenta AG reported an 11 percent decline in first-half net profit on Thursday, and lowered its full-year outlook after a slow start to the planting season.
Profits declined to $1.25 billion, after cold weather in the Northern Hemisphere delayed farming and high inventories from last year drove down prices, the Basel-based company said.
Sales rose 1 percent to $6.7 billion, boosted by exchange rate fluctuations. At constant rates, crop protection sales slipped 4 percent, while seed sales rose 2 percent — driven mainly by volume growth.
Shares tumbled 5.3 percent in Zurich to close at 229.30 francs ($220.48).
Syngenta reports earnings only for the half and full year.
“Some of the price gains implemented by Syngenta in the first half of 2009 were reversed,” the company said.
Syngenta said lower wheat prices in Europe, Africa and the Middle East affected grower demand, but sales in Latin America surpassed their 2008 highs as higher soybean acreage in Brazil and Argentina led to increased protection needs against crop disease. Growth also was strong in China.
“In the second half of 2010 we expect positive volume momentum to continue,” Syngenta CEO Mike Mack said.
Operating profit dropped 13 percent to $1.56 billion.
Mack said he expected a late year rally to bring operating profits back to around 2009 levels, but the company had forecast growth for that figure in April.