2009 Media Releases

July 23, 2009

Deutsche Bank initiates coverage of Nufarm Limited

Deutsche Bank has initiated coverage of crop protection company, Nufarm Limited (ASX: NUF) with a Hold recommendation.

Research analyst Mark Wilson initiated coverage with an AUD 8.90 twelve month price target.

Mr Wilson said, “Nufarm has a strong distribution network, growth platform and returns focus. However we estimate earnings will fall 10 per cent short of company guidance, inventory adjustments/writedowns are likely and the North American glyphosate market remains in excess capacity.”

According to Deutsche Bank research, the deterioration of the North American glyphosate market will take at least six to twelve months to stabilise and there is a risk this will also impact the European and South American markets. “The North American glyphosate market remains oversupplied and earnings could be further impacted by the sale of higher-cost inventories, impacting margins, and/or inventory writedowns,” noted Mr Wilson.

“Following a 4% decline in FY09, we expect earnings per share (EPS) to increase by 10 per cent in FY10 and 14 per cent in FY11 given positive farm economics (relatively high grain prices and lower input costs), the benefit of recent acquisitions (AH Marks and Etigra), an improving credit environment, the commencement of restocking, the introduction of new products, and the entry into new regions.”

Nufarm Limited is one of the world's leading crop protection companies. It creates products to help farmers protect their crops against damage caused by weeds, pests and disease. With manufacturing and marketing operations based in Australia, New Zealand, Asia, Europe and the Americas, Nufarm employs more than 2,600 people.

For further information, please call:

Michelle Chaperon (02) 8258 1311



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