company also has a licensing agreement with Washington State University Research Foundation that will enable it to develop, register and commercialise a potato sprout inhibitor in 2008 for post-harvest use in the US and Canada.
Having set up a Swiss subsidiary in Basel in 2005 to capitalise on growth opportunities in Europe and other international markets, the company is very optimistic about the future and believes that its growing portfolio of niche products will deliver double digit growth in sales and net income in 2006.
MAKHTESHIM SALES GROW 13%
Makhteshim Agan, currently ranked seventh globally in the agrochemical market, has reported its results for 2005. Sales revenue grew 13.1% to $1.74 billion compared to $1.54 billion in 2004. This increase, says the company, was derived mainly from strategic target markets, including the US, where sales increased by 56% to $309 million, compared with less than $200 million in 2004. Strong growth was also achieved by Makhteshim in Eastern Europe and Australia. In 2005, net profit passed $200 million for the first time, amounting to $207.5 million, an increase of 25.4% compared with 2004. Net profitability also rose to 11.9% in 2005, compared with 10.7% in 2004. During 2005, Makhteshim received 134 new registrations. Sales of new products increased by 14% to $537.2 million, representing 35% of total agrochemical sales.
Referring to the results, Danny Biran, chairman of Makhteshim Agan, said: “I view Makhteshim Agan’s ability to grow sales by 13% as an achievement, particularly in a year of difficult market conditions, in which the global agrochemical market showed little or no growth.” Looking ahead, Mr Biran said that the company will bring forward new developments in 2006. Alongside continued growth in the agrochemical market, Makhteshim also intends to expand its operations in the food supplement market.
NUFARM OFF TO SLOW START
Nufarm claims it is still on track to achieve 10% growth in net profit growth in 2005/06 on the back of increased sales and stronger margins. The comment follows the company’s recent announcement of a 15% fall in first half net profit to $34.18 million. Crop protection sales, 95% of group sales, have also fallen during the period from $629 million to $609 million. Nufarm said that whilst competition remained strong in its major markets the company expected to improve net margins through a combination of cost controls, increased sales of higher margin products, such as fungicides, and higher pricing aimed at recovering the impact of higher costs. "Nufarm directors believe that an expanded product portfolio and improved access to distribution will facilitate a strong performance for the full year. Given average to good seasonal conditions in the company's major crop protection markets, we believe we remain in a position to achieve forecast net profit growth of approximately 10% on last year," said a company spokesperson.
The first half results were negatively affected by Nufarm’s interest in the Brazilian crop protection company Agripec, which contributed a $14.9 million net profit for the six months to the end of January 2006, down from $22.2 million for the same period in the previous year. The 2005 calendar year in Brazil was characterised by drought conditions in many of the key regions and the impact of stronger local currency, the latter resulting in lower relative returns for the Brazilian farmers. Much of Europe has experienced a longer and more severe winter and this too has delayed sales activities said Nufarm. However, with the lower contribution from Agripec, Nufarm’s businesses in Australia, North America and Europe will be expected to perform strongly in order that the company can reach its profit objectives.
SECURING THE FUTURE OF WATER
World Water Day 2006 () on March 22 coincided with the release of the United Nation’s Global International Waters Assessment Report during the World Water Forum in Mexico. Titled Challenges to International Waters: Regional Assessments in a Global Perspective, the report shows that farms are a "big threat" to water resources. CropLife International took the opportunity to remind governments of the critical role that plant science technologies play in helping to address the challenges surrounding water use in agriculture. It said that agriculture is a daily activity common to all countries and cultures - and as the human practice that consumes more water than any other, it must be practiced sustainably if the world is to secure its water future. While major water savings will
31 March 2006 © Market Scope Europe Ltd www.crop-protection-monthly.co.uk