Viterra trumpeted its prospects, brightened by a strong outlook for global grains trading and the liberalisation of the sector in Canada, even as it unveiled a dip in earnings, undermined by feed industry competition.

The Canada-based grain handler, which is also a major player in Australia, said it was hiking it dividend by one-half, to Can$0.15 a share, a sign of "confidence in our business model and strategy to generate future earnings".

Viterra had an "enviable position", including "excellent assets in key growing regions and an efficient global marketing network", in a sector set to see growth of 30% in trading of wheat and coarse grains over the next decade.

"We are optimistic, as strong long-term global demand fundamentals continue to support the agricultural industry," Mayo Schmidt, the Viterra chief executive, said.

'Accretive growth opportunities'

Shorter-term, its operations would be helped by another season of bumper crop receipts, set to hit 6.5m-6.8m tonnes, at its Australia operations and, in Canada, by gains as it fills some of the void in barley and wheat marketing created by the end of the Canadian Wheat Board's monopoly.

The group - which said its underlying grain handling and marketing pipeline should remain "relatively insulated" from macroeconomic hiccups such as eurozone debt crisis and "tepid" US growth - restated forecast for an earnings uplift from the Canadian shake-up.

Mr Schmidt added that the group was "focused on increasing shareholder value".

"To do this, we will continue to optimise the performance of our existing asset base and pursue accretive growth opportunities as they arise."

'Intense competition'

However, the comments came as the group unveiled a soft end to an otherwise upbeat financial year, with earnings in the August-to-October period, the fourth quarter, tumbling 83% to Can$9m.

The result, equivalent to Can$0.03 a share, was short of the Can$0.09 a share that investors had expected.

Revenues soared 57% to $3.1bn, well ahead of market estimates, helped by elevated crop prices and the impact of a dry autumn in boosting fertilizer applications, and so farmers' demand for nutrients from Viterra's agricultural retail arm.

But margins in processing operations, such as malt and pasta making, shrank, and the group also swallowed a number of one-off charges.

These included a Can$8m writedown on the valuie of its western Canadian feed operations, "reflecting the continued intense competition and overcapacity in the market", besides a doubling in the group's tax rate to 36%.

Market reaction

The data divided analysts, with broker Raymond James raising its target price for Viterra shares to Can$14.00 from Can$13.50.

However, TD Securities cut its rating on the stock to "hold" from "buy".

Viterra shares closed down 4.9% at Can$10.59 in Toronto.