Agri chemicals maker FMC Corp forecasts weak Q1, shares slide
Feb 5 (Reuters) - FMC Corp forecast first-quarter profit below Wall Street estimates on Monday, as the crop protection product supplier anticipates lower sales volumes amid destocking across regions.
The Philadelphia-based company said it expects adjusted earnings between 21 cents and 43 cents per share in the first quarter of 2024, compared with analysts' average estimate of $1.00 per share, according to LSEG data.
Shares of FMC were trading nearly 10% lower in extended trading.
Worries over supply chain disruptions following the pandemic had prompted distributors to stock up on crop protection products, leading to a buildup of excess inventories that companies operating in the sector are still coping with.
"During the fourth quarter, we observed continued channel destocking in all regions, while drought in Brazil also amplified challenges in Latin America," said CEO Mark Douglas.
Sales fell 38% in the company's Latin America segment, which accounts for nearly 36% of FMC's revenue. This was primarily due to lower volumes from weaker demand and drought in Brazil.
The impact from South America, coupled with destocking in several regions, had led to nearly a 50% drop in FMC's share price in 2023.
On an adjusted basis, FMC earned $1.07 per share in the fourth quarter, missing estimates of $1.08 per share.
(Reporting by Vallari Srivastava in Bengaluru: Editing by Tasim Zahid)
