Nufarm Ltd (ASX: NUF) shares are catching the eye on Wednesday.
In morning trade, the ASX 200 stock is up 14% to $2.44.
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Why is this ASX 200 stock jumping?
Investors have been bidding this agricultural chemicals company's shares higher today following the release of its FY 2025 results.
According to the release, Nufarm reported a 3% decline in underlying EBITDA (uEBITDA) to $302.5 million for the 12 months.
The company posted an 18% increase in Crop Protection uEBITDA in FY 2026. Management notes this reflects reduced deflationary pressure on selling prices as the year progressed, as well as benefits from an improved mix.
Offsetting its Crop Protection growth was its Seed Technologies business, which posted uEBITDA of $13.9 million. This is down from $62.6 million a year earlier. This reflects losses in Omega-3, which was negatively affected by a decline in fish oil prices.
Excluding the impact of the emerging Omega-3 and Bioenergy platforms, the ASX 200 stock's uEBITDA would have been up 10% on the prior corresponding period.
On a statutory basis, Nufarm recorded a net loss after tax of $165.3 million. This includes $142.4 million of predominantly non-cash material items resulting from the review of Seed Technologies and performance improvement plan.
Unsurprisingly, the company's dividend remains suspended and no final dividend was declared for FY 2025.
The ASX 200 stock's CEO, Greg Hunt, who has announced plans to step down in January, said:
Our crop protection business performed very well in FY25, with underlying earnings up 18% and growth across all regions including a record performance in Asia and a material turnaround in performance in Europe. We have a reprioritised strategy in Seed Technologies, with lower costs and capital requirements, a clear focus on growing hybrid seeds, expanding Bioenergy and reducing cash requirements for Omega-3.
Outlook
Nufarm believes that it is positioned for uEBITDA growth and positive cash generation in FY 2026. It also expects its leverage to reduce to 2.0 by end of the financial year, supported by growth in earnings and positive free cash flow.
Hunt adds:
We made good progress on cost and working capital and delivered a significant reduction in net debt from the first half. Net debt is below the level anticipated in our August update, a strong demonstration of our ability to deleverage through internal discipline and efficiency. In FY26, we have good momentum in Crop Protection, clear direction and opportunity in Seed Technologies and are well placed to grow earnings, generate cash and reduce leverage.
