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ASX 200 (XJO) jumps 1.65%, Nufarm (ASX:NUF) reports big loss

The ASX 200 (ASX: XJO) is up 1.65% at lunch for the ASX.

Nufarm Limited (ASX: NUF) 

Nufarm announced its FY20 result today.

The company sold its South American businesses in April 2020, so that’s why the below numbers are the remaining ‘continuing’ businesses.

Nufarm announced that its continuing revenue increased by 7% to $2.85 billion with improved seasonal conditions in the second half in Australia, Indonesia, the United States and Canada. The breaking of the drought in Australia really helped.

However, there were hot, dry conditions in northern and eastern Europe, with weak demand in the fourth quarter.

Nufarm said there is improved product availability for Europe with fourth quarter indications of easting raw material costs to benefit FY21.

The continuing underlying EBITDA dropped by 21% to $236 million because of weaker earnings in the North American business in the first half and a decline in European and Seed Technologies earnings.

Underlying operating cash rose by $137 million to $217 million.

The company reported a continuing statutory net profit after tax (NPAT) of $362 million.

There were a number of material items affecting the FY20 report. There was $50.5 million of restructuring costs, $9.9 million of Nuseed legal fees, an $188.3 million impairment of the carrying value of European assets and a $33.1 million tax loss write-off (and other tax effects).

Including the discontinued operations, it saw underlying EBITDA fall 30% to $295 million and it reported a statutory loss of $456 million.

The Nufarm board decided to continue to suspend dividends.

Nufarm’s share price is up 8%.

Costa Group Holdings Ltd (ASX: CGC)

Costa shares are up 3.6% after the horticultural business announced an acquisition.

It was announced that Murray River Organics Pty Ltd (ASX: MRG) is going to sell 113 hectares of planted citrus and wine grapes at its Nangiloc property to a subsidiary of Costa for $4.5 million.

Coupled with surrounding vacant land, the sale comprises 390 hectares of its 3,040 Nangiloc property, effective 1 October 2020.

The final settlement of the sale is subject to registration of a plan of subdivision which is anticipated to complete in early 2021.

Costa will take responsibility for the operations and management of the parcel to be sold, including responsibility for operational costs and entitlement to the crops.

For MRO this could be an important announcement because it will help pay down debt and allow the business to focus on growth in its branded portfolio. The remaining 2,650 hectares of the Nangiloc property is the subject of a feasibility study, Project Magnum, focusing on optimum crop combinations and a potential localised desalination plant water solution.

Sezzle Inc (ASX: SZL)

Sezzle is going to partner with Ally lending, which is part of Ally Bank, which is the banking subsidiary of Ally Financial (NYSE: ALLY).

Ally Financial is a digital financial services company with US$184.1 billion in assets at 30 June 2020.

Ally Lending enables monthly fixed-rate installment-loan products that extend up to 60 months in length and US$40,000 per installment plan.

Apparently Ally has a NPS score of 68 which shows how much it is committed to the customer with aims like “Do Right” and “Obsess over the customer”. Sezzle seems happy to partner with this type of business.

The partnership between Ally Lending and Sezzle will give Sezzle merchants and shoppers access to long term financing options, adding to Sezzle’s existing short term, interest free offering, without adding any balance sheet impact to Sezzle.

The Sezzle share price is up 5% right now.

Other news

The team over at Rask Media have covered the rest of today’s news, so make sure you head over there for more ASX share market coverage.

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At the time of publishing, the author of this article does not have a financial or commercial interest in any of the companies mentioned.

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