Nufarm Posts Resilient FY25 Result with Strong Crop Protection Growth

About Nufarm Ltd

Founded more than 100 years ago and headquartered in Melbourne, Nufarm Limited (ASX: NUF) is a global crop protection and seed technologies company supplying herbicides, insecticides, fungicides, hybrid seeds and sustainable plant-based nutritional products. With operations spanning Australia, New Zealand, Europe, Asia, and the Americas, Nufarm plays a critical role in helping farmers meet rising food, feed, fibre and renewable fuel demand.

The company entered FY25 against a backdrop of volatile agricultural commodity prices, shifting planting behaviours and a normalising post-pandemic supply chain environment. Despite these challenges, Nufarm delivered a solid operational performance, led by a strong rebound in Crop Protection margins and disciplined progress on cost reduction and working-capital initiatives.

Financial Performance and Balance Sheet Strength

Nufarm reported underlying EBITDA of $302.5 million, slightly below the prior year but ahead of initial guidance once emerging platform impacts were excluded. The statutory net loss of $165.3 million was driven by $142.4 million in non-cash impairments relating primarily to the Omega-3 and Bioenergy platforms, following a comprehensive business review in Seed Technologies.

A key highlight of the year was the significant improvement in the company’s financial position. Net debt reduced by $538 million from 1H25, driven by better inventory management, stronger working-capital discipline and improved cash conversion. Average Net Working Capital to sales declined by 4.4 percentage points, while average inventory days dropped by 16 days, reflecting the success of efficiency programs implemented across global operations.

The company closed FY25 with leverage at 2.7x, better than expected in August, and expects to reduce this to approximately 2.0x by the end of FY26 as earnings strengthen and cash generation improves.

Crop Protection: Strong Growth Across All Regions

Crop Protection was the standout performer for Nufarm in FY25, delivering uEBITDA of $370 million, an impressive 18 per cent increase on the prior year. The division benefited from improved agronomic conditions, reduced price deflation and a stronger product mix, supported by disciplined commercial execution across global markets. Performance in the APAC region was particularly strong, with uEBITDA rising 10 per cent to $97.8 million as margins improved, the product mix strengthened and Asia delivered record results. New product introductions contributed meaningfully to growth, while Australia and New Zealand also recorded higher revenue and profitability.

Europe also posted robust gains, achieving uEBITDA of $161.3 million, up 22 per cent year-on-year, supported by favourable weather conditions and a well-executed performance improvement plan. Margin expansion was driven by improved mix, with Acetamiprid — part of Nufarm’s 2018 European acquisition — emerging as a standout performer. Increased production volumes at Wyke further supported the regional result, although pricing pressure persisted in MCPA.

North America contributed strong growth as well, delivering a 19 per cent increase in uEBITDA to $110.9 million. The improvement reflected better cost of goods and strong momentum in the second half, even as the region continued to face regulatory approval delays and tariff-related uncertainty. Notably, North America recorded a record year in its Turf & Ornamental business, underscoring the resilience of customer demand and the strength of Nufarm’s portfolio across diverse market segments.

Seed Technologies: Strategic Reset Underway

Seed Technologies reported uEBITDA of $13.9 million, a significant decline from the prior year, largely driven by losses in the Omega-3 platform following steep declines in global fish oil prices. Despite the downturn in Omega-3, the division’s core hybrid seed operations continued to perform well. South America delivered strong sales and profitability growth, supported by solid demand and improved market penetration, while Australia experienced lower canola seed volumes due to dry seasonal conditions. In the Bioenergy segment, the company expanded planted area through increased adoption of carinata feedstock, reflecting early progress in building a sustainable, scalable supply chain for renewable fuels.

Following a comprehensive strategic review, Nufarm has reprioritised its Seed Technologies division around four key pillars designed to lift returns and reduce balance-sheet intensity. The first priority is to reduce cash costs and overall capital intensity across the division, ensuring a more disciplined approach to investment. The second is to grow the Hybrid Seeds portfolio in targeted regions — particularly Australia, South America and the sorghum market in North America — where the company sees the strongest near-term demand and competitive advantage. The third pillar focuses on scaling the Bioenergy business under a capital-light model supported by the existing bp Offtake and Market Development agreement, which provides a clearer pathway to commercial expansion. The fourth priority is to stabilise Omega-3, with management emphasising a near-term focus on inventory sell-through and a medium-term plan to reposition production in line with long-term market trends.

Management reaffirmed its commitment to Omega-3 as a sustainable nutrition product despite recent headwinds, noting that the long-term demand fundamentals for plant-based omega oils remain attractive. The strategic refocus aims to strengthen overall divisional performance while positioning Seed Technologies for a more balanced and commercially resilient future.

Outlook

Looking ahead to FY26, Nufarm expects to maintain earnings momentum, underpinned by continued growth in Crop Protection uEBITDA, although at a more measured pace than the strong gains recorded in FY25. The company also anticipates improved performance from Seed Technologies as the benefits of its strategic reset begin to flow through, including a targeted uplift of approximately $30 million in uEBITDA from the combined Omega-3 and Bioenergy platforms. Management forecasts positive free cash flow for the year, alongside further strengthening in leverage metrics as working-capital efficiency initiatives continue and divisional earnings improve. Capital expenditure is expected to remain below $200 million, with additional debt reduction anticipated in the first half of the financial year. Nufarm emphasised its confidence in the “clear direction and opportunity” across both major divisions as it enters FY26, noting that the company is now positioned to deliver a more stable, higher-quality earnings profile supported by disciplined execution and a more focused portfolio.