Syngenta Raises Outlook on Booming Farm Market
Swiss agrochemicals group Syngenta raised its earnings outlook on Thursday, cashing in on roaring demand for farm goods and saying first-quarter sales had leapt 20 percent.
"Growth was spread across all regions, with particularly strong demand for crop protection products, augmented by a robust performance in seeds," Syngenta said.
The strong growth rate in the first quarter was unlikely to be sustained throughout the year, the company said, but it was still confident EPS growth would exceed 20 percent.
Syngenta, which makes products to kill weeds and bugs and is one of the world's biggest producers of genetically modified seeds, is benefiting from booming global demand for food and biofuels, which has boosted food prices.
Rising crop prices are spurring farmers to expand planting as some governments impose emergency measures to make sure they have enough staples like rice and flour to meet demand.
Syngenta shares closed 5.9 percent higher at 299.75 francs.
"Investors could like (this), and the shares could rise above the 300 Swiss franc level," Wegelin said in a research note.
Syngenta, which has a market value of more than $28 billion, also said it expected sales growth of at least 10 percent at constant currencies this year.
The outlook for EPS was higher than Syngenta's initial outlook for double-digit percentage EPS growth through 2010 and was on a fully diluted basis, excluding 2007 non-recurring income, restructuring and impairment and share buybacks.
No further details were immediately available. Syngenta will post a full first-quarter trading statement on April 22.