A strong finish to 2012 in North America, where farmers are
planning huge spring sowings, and Latin America prompted Syngenta to
express "confidence" in its prospects - but failed to lift the agrichemical giant's shares.
Mike Mack, the Syngenta chief executive, said the group was
expecting "further business momentum" in 2013, backed by a portfolio stretching
from sunflower seed to insecticides, and the ditching of its historic division
between seed and agrichemical businesses.
He added: "Our confidence is reinforced by the
fourth-quarter business strength, notably in North and Latin America," both
markets in which the group reported double-digit growth in sales in the period,
at rates exceeding that achieved over 2012 as a whole.
In North America, "strong demand in advance of the 2013 season
led to an acceleration of growth" in the October-to-December period, with the
impact accentuated by low inventories in the wholesale network.
Regional sales of agrichemicals soared 47% to $422m to
farmers, in Syngenta's broad Gramoxone herbicide, seeking alternatives to
glyphosate, for which weeds in some areas are showing resistance – a factor
which underpinned sales of some specialist weedkillers, such as Callisto, too.
Seed sales rose 10% to $292m, amid concerns over US supplies
in particular of corn seeds, following a poor harvest last year, and
expectations of sowings this spring hitting their highest in more than 70
Latin American agrichemical sales rose by 17% to $1.41m in
the quarter, and seed sales by 26% to $148m, reflecting the quest by growers to
expand sowings and yields to take advantage of historically high crop prices.
Syngenta highlighted in particular sales in soybeans, of which
Brazil is expecting a record harvest, taking it to top rank among world
producers, as well as the growing popularity of second-crop, safrinha corn.
The growth in safrinha corn, now being planted in Brazil as
a follow-on crop to soybeans "is favouring technology adoption in both crop protection
and seeds", said Syngenta.
Separately, the company announced a $77m investment to
quadruple to 1.6m bags annual output from a corn seed plant in Goias, in
The group also flagged a boost from the quest by cane
growers to "boost productivity", after a disappointing 2011 result, a drive "reflected
in strong growth in herbicide sales and the identification of new opportunities
in seedlings and young plants".
The group's overall sales in the fourth quarter rose 11.6%
to $3.34bn, helping lift the full-year figure to a record $14.20bn, a rise of
Full-year earnings rose 17.1% to $1.87bn, narrowly ahead of
Nonetheless, even though the Swiss-based group also revealed
an increase to SFr9.50 a share, from SFr8.00 a share, in its dividend, the data
received a cautious response from investors, with a lower tax rate also seen as
A rise of 8.4% to $2.91bn in annual earnings before
interest, tax, depreciation and amortisation (ebitda) came in a little below
Credit Suisse analyst Chris Counihan, while retaining an "outperform"
rating on Syngenta stock, and a price target of SFr450, said: "We expect share
price easing on an operational result moderately below our and market
The shares fell 2.1% to close at SFr387.10.