The following is a summary of the Nufarm Limited (NUFMF) Q2 2024 Earnings Call Transcript:
Financial Performance:
Nufarm reported underlying EBITDA of $217 million and statutory NPAT of $49 million for H1 of 2024.
The company predicts EBITDA of between $350 million and $390 million for FY 2024.
An interim dividend of $0.04 per share was declared.
Despite higher average working capital, commitment remains towards efficient capital use, with a predicted return of average net working capital to the target range.
Expectations for underlying EBITDA between $350 million and $390 million in FY 2024 represent a 16% reduction from FY '23
The projection for strong growth in H2 '24, with the guidance midpoint indicating EBITDA growth of 25% YoY.
Business Progress:
Significant progress made in reducing inventory, now 20% lower YoY.
Continued support for Omega-3 and Carinata plantings with expected revenue growth in 2025. Reaffirmed 2024 Omega-3 revenue projection of $50 million to $70 million.
Growth plans include geo-expansion of Carinata planting and continued discussions with potential Nutriterra segment partners in the U.S.
The targeted Crop Protection business revenue is between $3.8 billion and $3.9 billion by FY '26.
A strong future is anticipated for the biofuels platform, expanding in Southern U.S.A., Argentina, Brazil, France, and Spain.
Through 2025 and '26, Omega-3 production is expected to be scaled, and a strengthening of position in phenoxy herbicides and new product introductions is aimed for.
Completed strategic actions include factory closures, performance improvement programs, portfolio acquisitions, and a state-of-the-art formulation facility launch.
Nufarm plans to achieve its 2026 targets with a roughly 20% price recovery and contributions from NPIs.
The company continues to monitor the supply chain situation in China for their Herbicide production, anticipating that restocking and replenishment needs should cause a price increase as demand increases.
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