Agrochemicals company Syngenta posts 1 percent drop in full-year profit to $1.37 billion

Friday, February 5, 2010

Syngenta posts 1 pct drop in full-year profit

BASEL, Switzerland — Agrochemicals company Syngenta AG on Friday reported a 1 percent drop in full-year net profit because of higher raw material costs, less demand for pesticides and a strong dollar.

Net profit for 2009 was $1.37 billion compared with $1.39 billion the previous year, Syngenta said.

The strength of the dollar led to a 5 percent drop in the value of sales to $11 billion, compared with $11.6 billion in 2008.

Syngenta, which reports earnings only for the half and full year, said it is more optimistic for 2010.

“Improved conditions in emerging markets are contributing to a more positive outlook for 2010 and lead us to expect volume growth starting in the second quarter,” said CEO Mike Mack in a statement.

Shares in Syngenta closed up 0.33 percent at 273.30 Swiss francs ($257.5) on the Zurich exchange.

The company proposed an unchanged dividend of 6 francs ($5.65) per share and said it plans a share buyback program this year. The total cash return will be about $750 million, it said.

“In 2009, Syngenta achieved earnings close to the record level of 2008 in the face of considerable challenges including negative currency movements and higher raw material costs,” said Mack.

Geneva broker Helvea said the results are overall in line with its expectations. Syngenta’s seeds business made solid progress in corn and soybean, it said.

Seeds increased 5 percent to $2.6 billion. Sales of seeds for corn and soybeans went up particularly in the United States.

Crop protection, which generates about 75 percent of Syngenta’s revenue, decreased 8 percent to $8.5 billion.

The season for pesticides started late in Europe, Africa and the Middle East, said Syngenta, adding that there were fewer crop diseases circulating in those regions.

Crop protection sales in Latin America were down in the first half partly because of drought.

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