Syngenta Q3 Sales Up; Sees Lower EBITDA Margin For Full Year - Update

(RTTNews) - Swiss crop chemicals firm Syngenta AG (SYT) Thursday said its third-quarter reported sales increased 2 percent from last year, benefited by growth across all regions. Looking ahead, the firm sees full-year EBITDA margin to be below last year's level.

For the fourth quarter, the company expects a higher rate of sales growth, and maintained its full-year integrated sales growth target of 6 percent at constant exchange rates.

Group sales for the quarter increased to $2.98 billion from $2.92 billion last year. The growth was 2 percent on actual as well as currency-neutral basis.

Integrated sales rose 3 percent at constant exchange rates to $2.8 billion, with 3 percent rise in prices and unchanged volumes. Excluding solo glyphosate, which is being reduced to improve profitability, sales were up 5 percent.

In Latin America sales increased 3 percent, or up 8 percent excluding glyphosate. In Asia Pacific, sales grew 3 percent. Emerging markets continued to perform well despite the delayed monsoon in South Asia. Meanwhile, sales were lower in Australasia due to limited weed and disease pressure, the firm said.

Sales in Europe, Africa and the Middle East, or EAME, improved 3 percent. The company noted that sales in North America were driven by strong selective herbicide sales in advance of the next US season.

Mike Mack, CEO, said: "Performance in the second half of the year is primarily driven by Brazil, where the season is just now under way and is still dependent on rainfall. We are seeing strong demand for our newly launched fungicide ELATUS for which we are on track to achieve targeted sales."

Syngenta said for the first nine months of this year, profitability has been affected by adverse currency movements and sales mix. As a result the full year EBITDA margin will be below last year's level.

The company had said in July that it continued to expect full-year integrated sales growth of around 6 percent at constant exchange rates. Profitability in the second half of the year was expected to benefit from the non-recurrence of the seeds inventory write-down incurred in the second half of 2013.

"In a challenging market environment, our focus is on improving profitability and we are on track to realize the first benefits from the implementation of our operational leverage program in 2015," Mack added.

In Zurich, the shares closed Wednesday's trading at 283.50 Swiss francs.