GrainCorp shares slide as guidance misses forecasts
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More news: GrainCorp shares tumbled in morning trade after the agriculture group's full-year guidance missed market expectations.
GrainCorp shares lowered by 6.6% to $6.92 by 11:20am AEDT.
GrainCorp's underlying NPAT guidance of between $60 million and $95 million was 31% behind consensus estimates at the mid-point. It also guided full-year underlying EBITDA of $270 million to $320 million, 10% below average forecasts at the mid-point.
What they said: "We expect the market to be downgrading on the back of this initial guide," said RBC Capital Markets analyst Owen Birrell.
"However, we also think that [GrainCorp] has been somewhat more conservative in providing this guide than prior years, given the higher degree of uncertainty regarding macro and market variables."
GrainCorp guides for FY profit growth, unveils $50m buyback
The news: GrainCorp has set full-year underlying profit guidance of between $60 million and $95 million, with the mid-point representing a slight uptick on the previous year.
The grain receival and storage company also announced an on-market share buyback of up to $50 million.
The numbers: GrainCorp has guided full-year underlying NPAT of $77.5 million at the mid-point, compared to last year's total of $77 million.
The company also expects full-year grain receivals of between 13 million and 14 million metric tonnes (mmt), up from 10.1 mmt in FY24. It said the higher receivals will support an export program of between 6.5 mmt and 7.5 mmt for the year, up from 5.6 mmt last year.
The context: GrainCorp managing director and CEO Robert Spurway said the despite varying growing conditions between northern and southern regions, overall east coast Australia production has been strong.
What they said: "The winter crop harvest got off to an early start in Queensland and Northern NSW, and it was pleasing to see several of GrainCorp's sites in those regions achieve new grain receival records," Spurway said.
"However, conditions were more challenging in southern regions, with the Victorian crop in particular down on recent seasons."
On the share buyback, Spurway said: "The share buyback reflects the strength of our balance sheet and delivers on our ongoing commitment to continue generating returns for shareholders through the cycle".
The source: ASX announcement
