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Firm garners support for Nufarm class action

Firm garners support for Nufarm class action

Class action law firm Maurice Blackburn is weighing up a potential class action against Nufarm Limited._x000D_

CLASS action law firm Maurice Blackburn is weighing up a potential class action against Nufarm Limited.

The firm announced today it has been approached by concerned investors in the agricultural chemical company for allegedly failing to disclose information to the share market.

The action is being considered to recover losses suffered as a result of alleged non-disclosured and misleading or deceptive conduct, the firm said, relating to the company’s revised forecast for earnings and profit for the 2010 financial year ending 31 July this year.

Nufarm is an Australian-based business that produces and supplies agricultural chemicals throughout the world.

Maurice Blackburn NSW Principal, Ben Slade, said the firm’s clients allege Nufarm made misleading representations about its profit capacity between 2 March 2010 and 14 July 2010.

On 2 March, the company announced a headline loss of about $40 million for the six month period to 31 January 2010. The loss included $33m of material items, including glyphosate trading impacts. Also contributing to the loss were lower than projected pricing margins in all global markets and relatively low demand due to climatic conditions in Europe and North America.

It then forecasted a full year profit of between $80m and $100m for the FY 2010 period, requiring a headline profit of between $120m and $140m for the second half 2010 period. It reaffirmed those forecasts at the end of March. In june it commented that it would “continue to keep year end under close and regular review … and advise the market if [Nufarm] form a different view of the final result”.

On 14 July, the company downgraded its FY 2010 profit forecast by 50 per cent, to between $55m and $65m, excluding non-operating items. Net debt was also forecast to increase.

Maurice Blackburn said the company “breached its continuous disclosure requirements by failing to correct those misrepresentations thereby causing investors in the company to suffer losses when the truth came out”, Slade said.

“Our investigations suggest that Nufarm ought to have been aware by the beginning of March 2010 that its second half $120m profit forecast was so ambitious that it was misleading.

“There is a good claim for shareholders and we are also considering widening the claim period if information comes to light to justify this.”

Shareholders are only able to make informed decisions regarding their share purchases when the company adheres to its disclosure obligations,” said Slade.

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