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Nufarm has reached a settlement in relation to a long-running dispute with a supplier.
The agriculture company announced on June 15 that the receivable would be written down to a value of $25 million in the company's year-end accounts as at July 31.
The settlement will recover $13.5 million against the receivable's written down value, resulting in a further write down at year end.
The total write down associated with the unrecovered portion of the receivable will be treated as a material item in Nufarm's 2011 full year accounts and will reduce Nufarm's headline net profit by $28 million.
Although Nufarm hasn’t named the supplier, the Sydney Morning Herald reported it as giant food company Monsanto.
Nufarm also said today that its underlying net operating profit (exclusive of one-off material items and the impact of the receivable losses) is expected to exceed the top end of the guidance range ($88 million – $94 million) provided by the company on July 13.
The company's full year results for the 12 months to July 31 – which are still subject to final audit – will be released on September 28.