Syngenta Says Profit Goal at Risk From Writedown, Currency

Syngenta AG (SYNN), the world’s largest maker of crop chemicals, said its outlook for profit this year is under threat after writing down the value of seed inventories and incurring currency expenses.

Depending on demand in Latin America, adjusted earnings per share may be “close to last year’s underlying level,” the Basel, Switzerland-based company said in a statement today. Earlier in the year, the company predicted earnings per share would “substantially improve.”

Fourth-quarter performance “is all going to come down” to demand in key agricultural markets in Latin America, Mack said in an interview. The company is waiting for Brazil approval of soy fungicide Solatenol which could eventually bring annual sales of more than $850 million, he said. Syngenta reiterated its sales outlook after a companywide reorganization along crop lines and purchases of new technologies.

“There was a question about whether or not we would be able to get a full 8 percent sales growth in 2013 - it looks like we are set to do that,” Mack said in an interview. “We feel good coming in to the fourth quarter.”

Shares of Syngenta dropped 2.6 percent to 345.1 francs as of 9:09 a.m. in Zurich.

While sales earlier in the year were affected by cold weather in Germany and the U.S., quarterly revenue matched analysts’ estimates, rising 8 percent to $2.9 billion.

In Latin America sales at constant exchange rates grew 17 percent driven by soybean orders from Brazilian farmers who are benefiting from the real’s depreciation which helps exports.

The writedown on corn seeds may be about 1 percent of full-year sales, Chief Financial Officer John Ramsay said in an interview.

To contact the reporter on this story: Patrick Winters in Zurich at pwinters3@bloomberg.net

To contact the editor responsible for this story: Simon Thiel at sthiel1@bloomberg.net

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