Nufarm Limited

Nufarm Limited | Annual Report

2010

contents

01  key events

01 

facts in brief

03  managing director’s review

09  business review

14  health, safety and environment

16  management team

18  board of directors

21  corporate governance 

28  financial statements

29  directors’ report

39 

lead auditor’s independence declaration 

40 

income statement

41  statement of comprehensive income

42  balance sheet

43  statement of cash flows 

44  statement of changes in equity 

46  notes to the financial statements

109  directors’ declaration

110  independent auditor’s report 

113  shareholder and statutory information

117  directory

key events

–  Continued instability in glyphosate segment

–  Adverse seasonal conditions in key regions

–  Competitive pricing environment

–  New product introductions on track

facts in brief 

Trading results

Profit/(loss) attributable to shareholders 
Abnormal (gain)/loss 
Operating profit after tax 

Sales revenue 
Total equity 
Total assets 

Ratios

Earnings per ordinary share 
Net debt to equity 
Net tangible assets per ordinary share 

Distribution to shareholders 
Annual dividend per ordinary share 

People

Staff employed 

12 months ended  12 months ended
31 July 2009
$000

31 July 2010 
$000 

 (23,990) 
82,556  
58,566  

2,168,630  
1,749,891  
3,093,842  

79,877 
79,755 
159,632 

2,677,083 
1,631,939 
3,251,597 

12 months ended  12 months ended
31 July 2009

31 July 2010 

 (15.0)¢ 
35% 
 $3.45  

 33.5¢ 
57%
 $3.59 

 –  

 27¢ 

 3,154  

 3,155

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

01

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

02

 
 
 
 
 
managing director’s review

Doug Rathbone AM 
Managing director and chief executive

The combined impact of an unstable 
global glyphosate market, adverse  
climatic conditions in key regional  
markets and an extremely competitive 
pricing environment delivered a very  
disappointing profit result for the  
company in what has been a  
challenging year.

The tax paid operating profit, excluding material items, 
was $58.6 million for the year ended 31 July 2010.  
The reported ‘headline’ result was a net loss of  
$22.6 million, which includes the impact of material 
items totalling $82.6 million. 

Operating earnings before interest and tax (EBIT) –  
before the impact of material items – was $135 million. 
This compares to $278 million in the previous financial 
year. 

Group revenues decreased by 19 per cent to  
$2.17 billion.

On a per share basis, the company lost 15 cents, 
compared with last year’s earnings of 33.5 cents  
per share.

Material items

The company recorded an $82.6 million after tax loss 
associated with material items. 

Of this amount, $30.1 million was associated with 
glyphosate related losses and costs relating to pricing 
support, the majority of which pertained to higher  
cost inventory held at the end of the 2009 financial 
year ($29.4 million of this total was recorded at the  
half year). These costs were mainly associated with 
inventory write downs, losses on sales and various 
measures of one-off support provided to distribution 
customers during the first six months of the  
financial year.

The company has resolved that any tax loss that 
cannot be recouped within eight years will no longer 
be recognised in the financial accounts, irrespective 
of the period in which the losses can be offset 
against taxable income in the tax returns of the 
individual jurisdiction.

Consistent with this policy, a loss of $37.5 million 
was recorded for the non-cash write off of previously 
recognised tax losses in Brazil.

After tax costs of $10.7 million were associated with 
operational restructuring activities in France, and in 
the UK where the company closed a manufacturing 
site at Belvedere. The majority of other material items 
were due diligence costs relating to the Sinochem 
takeover proposal, the Sumitomo tender offer and  
the acquisition of several seeds businesses.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

03

 
 
 
 
 
managing director’s review continued

Final dividend

Directors resolved not to declare a final dividend for 
the 2010 financial year. 

Treasury

The company generated nearly $200 million in 
operating cash flow in 2010, compared to an operating 
cash outflow of $50 million in 2009. This was despite 
the higher than expected receivables at year-end. The 
cash not collected from receivables prior to year-end 
is being collected in the early months of the 2011 
financial year.

These arrangements will incur additional costs 
relating to fees associated with the provision of 
waivers, additional interest costs and associated 
advisory fees. It is estimated that these costs will 
total up to approximately $10 million for the period 
through to mid December when the company intends 
to have in place a more efficient long term banking 
structure. Approximately $8 million of this total 
relates to one-off waiver and advisory costs.

Nufarm is now working with its lenders to establish 
the new financing structure and is confident of 
finalising new arrangements by mid December.

The improved cash flow was directly attributable  
to a reduction in net working capital of $165 million, 
primarily from reduced inventory holdings.

An increase in cash from operations, combined with 
the proceeds of the April/May 2010 equity raising, 
facilitated a reduction in net debt ($620 million  
at 31 July 2010 compared to $938 million at  
31 July 2009). 

At year-end, gearing (net debt to equity) was 35 per cent 
compared to 58 per cent at July 2009.

Subsequent events

Nufarm announced on 27 September that it has 
secured waivers on its banking covenants for the 
periods ending 31 July 2010 and 30 October 2010. 
Nufarm’s lenders have also agreed to provide a funding 
facility for the period through to mid December.

The waiver agreement has been finalised with  
banks that are a party to the negative pledge deed 
(Nufarm’s core financing document) and addresses  
all maturities falling due during the balance of this 
calendar year. 

The funding facility is subject to satisfactory  
performance against interim milestones based on  
the company’s own projections and objectives, as 
well as progress relating to strategy and management 
plans, as discussed with its lenders. The Nufarm 
board is confident that the milestones and other 
requirements can be met. The facility is also subject 
to undertakings and covenants typical for a transaction 
of this nature and includes an undertaking by Nufarm 
to provide security over its assets. 

Strategic review

On 14 July 2010, we announced that we are  
undertaking a comprehensive strategic review to 
identify potential improvements to Nufarm’s financial 
and reporting systems, and to confirm what business 
and strategic changes are required to ensure Nufarm 
can achieve sustainable and profitable growth.

Deloitte and Gresham Advisory Partners are assisting 
the company with that review process.

The review will continue for several months, with 
shareholders being updated at the Annual General 
Meeting on 2 December 2010.

Tribute to Kerry Hoggard

Kerry Hoggard retired as chairman of Nufarm  
on 13 July 2010. Kerry’s contribution to Nufarm – 
both as a long-standing employee and executive  
of the company and in his role as chairman –  
has been significant. 

In a career spanning 50 years, he served as managing 
director of Fernz and, for the past 10 years, as chairman 
of Nufarm. 

Kerry’s leadership and deep knowledge of the business 
have been fundamental to the company’s growth and 
success over a long period. 

On many occasions, his exceptional attributes also 
have been recognised by a variety of professional 
bodies, including Kerry being acknowledged as the 
NZ Business Herald’s 1998 Business Leader of  
the Year.  

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

04

 
 
 
 
 
 
managing director’s review continued

The company will continue to develop and introduce 
new products in various segments and geographic 
markets throughout 2011, with a much stronger 
focus on higher value opportunities in insecticides, 
fungicides, seed treatment and seeds.

These factors and initiatives provide strong confidence 
that the group will generate an improved profit 
outcome for the 2011 financial year.

Doug Rathbone AM
Managing Director 

28 September 2010

Colleagues throughout the company and the Nufarm 
board appreciated his wise counsel and excellent 
people skills, as did external companies with which 
we do business. 

Kerry’s outstanding dedication and generosity  
is a lasting legacy for Nufarm and he retired with  
the best wishes of the board. 

Loyalty and effort

The 2010 year has been a challenging year for the 
business and for the people within it. I would like  
to acknowledge the loyalty and effort displayed by all 
Nufarm employees throughout our global operations. 
It will be via the ongoing commitment and capabilities 
of these people that Nufarm achieves its future goals 
and a return to strong profit and growth.

Outlook

Following a difficult financial year in 2010, the 
company expects to benefit from increased stability 
and improved trading conditions in certain market 
segments in the 2011 reporting period.

The glyphosate segment will continue to be very 
competitive and we expect to generate margins  
on glyphosate sales that will be below the average 
margins achieved in the balance of the business. 
Nufarm has begun the new financial year with  
a market competitive cost position and no legacy 
issues associated with high cost glyphosate  
inventory. We do not expect glyphosate-related 
writedowns and other one-off costs associated  
with the market volatility and inventory issues  
of 2010 to recur.

A return to more average seasonal conditions  
in key markets would result in increased demand  
and volume opportunities and would facilitate a  
more favourable pricing environment in a number  
of market segments.

Management and structural changes in Nufarm’s 
Brazil business, coupled with any further recovery in 
Brazil’s general credit environment and more rational 
market behavior, is likely to lead to an improvement in 
the profitability of that business in 2011. The addition 
of several new products will also improve the overall 
margins likely to be achieved in Brazil.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

05

 
 
 
 
 
Operating profit

9

.

3

6

1

6

.

9

5

1

7

0

0

2

8

0

0

2

9

0

0

2

Operating profit

Group sales

Operating profit

7

0

0

2

8

0

0

2

9

0

0

2

Group sales

Operating profit

1

.

1

2

1

6

0

0

2

7

7

6

,

1

1

.

1
2
1

6
0
0
2

9

.

0

2

1

4

6

7

,

1

9

.

0
2
1

7
0
0
2

9

.

3

6

1

6

.

9

5

1

2

9

4

,

2

9

.

3

6

1

7

7

6

,

2

6

.

9

5

1

8
0
0
2

9
0
0
2

6

.

8

5

0

1

0

2

9

6

1

,

2

6
.
8
5

0
1
0
2

n

o

i

l

l

i

m

$

n
o

i
l
l
i

m
n
$
o

i
l
l
i

m
$

managing director’s review continued

6
0
0
2

7
0
0
2

8
0
0
2

9
0
0
2

0
1
0
2

n

o

i

l

l

i

m

$

n

o

n

i

o

l

l

i

i

l

l

m

i

m

$

$

n
o

i
l
l
i

m
$

n
o

i
l
l
i

m
n
o
$
i
l
l
i

m
$

n
o

i
l
n
l
i
o
m
e
i
g
l
l
$
a
i
m
t
n
e
$
c
r
e
P

e
g
e
a
g
t
n
a
e
t
n
c
r
e
e
c
P
r
n
e
o
P

i
l
l
i

m
$

e
g
a
t
n
e
c
r
e
P

s
e
t
g
n
a
e
t
C
n
e
c
r
e
P

s

t

n

e

e

g

C

a

t

n

e

c

r

e

P

1

.

1

2

1

6

0

0

2

1

7

.

7

1

6

2

,

1

1

6

0

6

0

0

2

0

2

7

7

6

,

1

0
.
2
5
2
1
.
1
2
1

6
0
0
2

6
0
0
2
6
0
0
2

9

.

0

2

1

4

9

6

.

0

7

,

2

1

1

7

0

7

0

0

2

0

2

4

6

7

,

1

0
.
0
6
2

9
.
0
2
1

7
0
0
2

7
0
0
2
7
0
0
2

Group sales

EBITDA

Operating profit

EBITDA
Group sales

2

9

9

4

.

,

3

2

6

1

8

0

8

0

0

2

0

2

2

9

4

,

2

6

.

8

5

3

9

.

3
6
1

8
0
0
2

8
0
0
2
8
0
0
2

Return on funds employed

8
0
.
7
.
2
1
5
2

7
7
6
,
1

6
0
0
6
2
0
0
2
6
0
0
2

0
.
6
0
.
6
6
2
1
4
6
7
,
1

7
0
0
7
2
0
0
2
7
0
0
2

Return on funds employed
Net debt to equity

EBITDA

8
.
7
1
1
8

0
.
2
5
2

6
0
0
6
2
0
0
2

6
0
0
2

6
.
6
1

0
.
0
6
2
6
3

7
0
0
7
2
0
0
2

7
0
0
2

Net debt to equity
Earnings per share

4
.
7
1

6
9
.
8
6
5
3

8
0
0
8
2
0
0
2

8
0
0
2

1
8

Return on funds employed

.

3
0
8
6
7
1

.

6
0
6
0
0
2
0
2

.

2
9
5
6

.

6
6
1
3

7
0
7
0
0
2
0
2

Earnings per share

6
0
0
2

7
0
0
2

Net debt to equity

3
.
0
6

1

8

6

0

0

2

6

0

0

2

2
.
9
5

7

0

0

2

6

3

7

0

0

2

Earnings per share

3

.

0

6

2

.

9

5

6
.
8
5
3
2
9
4
4
,
.
2
7
1

8
0
0
8
2
0
0
2
8
0
0
2

9
6
7
9
6

.

.

4
7
1

8
0
8
0
0
2
0
2

8
0
0
2

7
.
9
6

9

6

8

0

0

2

8

0

0

2

7

.

9

6

6

.

8

5

0

1

0

2

9

6

1

,

2

6

.

8

5

0

1

0

0

1

2

0

2

9

6

1

,

2

1
.
3
9
0
1
1
0
2

6
.
8
5

0
1
0
2
0
1
0
2

9
6
1
,
1
2
.
3
9
1

5
.
5

0
1
0
0
2
1
0
2
0
1
0
2

5
5
3
1
.
5
.
3
9
1

0
1
0
0
2
1
0
2

0
1
0
2

5
3

0
1
0
2
0
1
0
2

.

0
5
5
1
.
-
5

0
1
0
2

0

1

0

2

0

.

5

5

1

-

3

0

1

0

2

0

1

0

2

0

.

5

1

-

7

7

6

,

6

2

.

9

5

1

9

0

9

0

0

2

0

2

7

7

6

,

2

2

.

6

4

3

6
.
9
5
1

9
0
0
2

9
0
0
2
9
0
0
2

2
.
6
7
4
7
3
6
,
2

7
.
1
1

9
0
0
9
2
0
0
2
9
0
0
2

2
.
7
6
.
4
1
3
1
7
5

9
0
0
9
2
0
0
2

9
0
0
2

7
5

.

5
3
3
7

.

1
1

9
0
9
0
0
2
0
2

9
0
0
2

5

.

3

3

7

5

9

0

0

2

9

0

0

2

5

.

3

3

9

0

0

2

s

t

n

e

C

6

0

0

2

7

0

0

2

8

0

0

2

n
o

i
l
l
i

m
n
$
o
n
i
o
l
l
i
i
l
m
l
i
m
$
$

n
o

i
l
l
i
m
e
n
g
o
$
a
i
l
t
l
n
i
m
e
c
r
$
e
P

e
g
a
e
t
n
n
g
e
o
a
c
t
i
l
n
r
l
e
i
e
m
P
c
r
$
e
P

e

g

a

t

e

n

g

e

a

c

s

t

r

t

n

e

n

e

P

e

c

C

r

e

P

e

g

a

t

n

e

s

c

t

r

n

e

e

P

C

Group sales

EBITDA
Operating profit

7
7
6
,
0
1
.
2
1
5
.
1
2
2
1

6
0
0
2

6
0
6
0
0
2
0
2

4
6
7
,
1
0
.
0
9
6
.
2
0
2
1

7
0
0
2

7
0
7
0
0
2
0
2

2
9
4
,
2
6
.
8
5
9
3
.
3
6
1

8
0
0
2

8
0
8
0
0
2
0
2

Group sales

EBITDA
Return on funds employed

8
.
7
1
7
7
6
0
,
1
.
2
5
2

6
0
0
2

6
0
6
0
0
2
0
2

6
4
.
6
6
7
1
,
0
1
.
0
6
2

7
0
0
2

7
0
7
0
0
2
0
2

2
9
4
,
6
2
.
8
4
5
.
3
7
1

8
0
0
2

8
0
8
0
0
2
0
2

Net debt to equity
EBITDA
Return on funds employed

1
8
8
7
1

.

.

0
2
5
2

6
0
6
0
0
6
2
0
0
2
0
2

6

.

6
1

.

0
0
6
2

6
3

7
0
7
0
0
7
2
0
0
2
0
2

6

.

.

8
4
5
7
3
9
1
6

8
0
8
0
0
8
2
0
0
2
0
2

Earnings per share
Net debt to equity

Return on funds employed

1
8
8
.
3
7
.
1
0

6

6

0

0

2

6

0

0

2

6

0

0

2

1

8

3

.

0

6

6

0

0

2

6

0

0

2

2
6
.
.
9
6

5

1

6

3

7

0

0

2

7

0

0

2

7

0

0

2

2

.

9

5

6

3

7

0

0

2

7

0

0

2

Earnings per share

Net debt to equity

7
.
9
4
6
.
7
9
1
6

8

0

0

2

8

0

0

2

8

0

0

2

7

.

9

6

9

6

8

0

0

2

8

0

0

2

7

.

9

6

Earnings per share

3

.

0

6

2

.

9

5

s

t

n

e

C

6

0

0

2

7

0

0

2

8

0

0

2

7
7
6
,
2

2
.
6
4
6
3
.
9
5
1

9
0
0
2

9
0
9
0
0
2
0
2

7
7
6
,
2

2
.
6
4
3

7
.
1
1

9
0
0
2

9
0
9
0
0
2
0
2

.

2
6
4
3

7
5
7

.

1
1

9
0
9
0
0
9
2
0
0
2
0
2

7

5

7

5

.

.

1

3

1

3

9

0

0

2

9

0

0

2

9

0

0

2

7

5

5

.

3

3

9

0

0

2

9

0

0

2

5

.

3

3

9

0

0

2

9
6
1
,
2

1
.
3
9
1

6
.
8
5

0
1
0
2

0
1
0
0
1
2
0
2

9
6
1
,
2

1
.
3
9
1

5
.
5

0
1
0
2

0
1
0
0
1
2
0
2

.

1
3
5
9
3
1

5

.

5

0
1
0
0
1
0
2
0
1
2
0
2

5

3

0

1

0

2

5

0

.

.

5

5

1

-

0

1

0

2

0

1

0

2

5

3

0

1

0

2

0

.

5

1

-

0

1

0

2

0

1

0

2

0

.

5

1

-

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

06

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

07

 
 
 
 
 
0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

08

 
 
 
 
 
business review

A combination of continued pricing  
and margin pressure in the glyphosate 
segment, adverse climatic impacts  
and a generally weaker demand and 
pricing environment contributed to  
very challenging operating conditions 
during the 2010 financial year and  
a disappointing profit result.

While Nufarm maintained its market shares in most 
key products and geographic markets, competition in 
many segments was intense and this limited Nufarm’s 
ability to maintain margins in certain areas of the 
business.

Confidence in the early months of the financial period 
that the global glyphosate issues that were having such 
an impact on the industry had stabilised was not 
realised and the continued instability and value erosion  
in this segment had a dramatic impact on the group 
result. While the glyphosate segment had begun to 
stabilise in some markets by the end of the financial 
year, the impact of high cost inventory and intense 
pricing competition during the year was significant.

Glyphosate represented 27 per cent of total revenues 
in 2010, down from almost 32 per cent in 2009 and  
39 per cent in 2008. Glyphosate sales were down by 
31 per cent (from $868 million in 2009 to $597 million 
in 2010), despite volumes increasing. The total gross 
margin contribution from glyphosate more than halved 
during the same period, with the average gross 
margin falling to 12 per cent (2009: 18 per cent).

The gross profit impact of high cost opening glyphosate 
inventory and credits given in relation to the previous 
year’s glyphosate sales was $57.1 million. Of this 
amount, $44.7 million was classified as relating  
to one-off items.

Revenues associated with products other than 
glyphosate fell by 13 per cent during the year, 
although sales of those products increased in a 
number of markets when measured in local currency. 
Both lower volume demand and pricing pressure  
had an impact on sales. Herbicides and insecticides 
recorded sales declines, but fungicide sales were up 
by about 16 per cent and seeds sales grew strongly. 

Climatic conditions in many regional markets saw 
lower demand for a range of crop protection products, 
with the increased competition for fewer sales 
opportunities contributing to a weak pricing  
environment. 

Importantly, sales of new products (those introduced  
by Nufarm within the previous five year period) 
increased from 2009 to 2010 by 20 per cent  
to $283 million. This increase reflects continued 
momentum in the development and introduction  
of products that will be important contributors  
to the company’s profitable growth. As a group,  
these products generated average gross margins  
of just under 40 per cent. 

Total new products* revenue

Total new products* revenue

300

250

200

150

150

100

50

s
n
o

i
l
l
i

m
$

6
0
0
2

7
0
0
2

8
0
0
2

9
0
0
2

0
1
0
2

Trend line

Actual

Continuous average growth rate – 53%

* Products launched by Nufarm within the past 
  five years.

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

0

1

0

2

Trend line

Actual

Continuous average growth rate – 53%

* Products launched by Nufarm within the past five years.

Australasia

Revenue 
Segment profit* 

2010 
$ million 

2009 
$ million

799  
89.2 

850
118.5

*  Segment earnings before interest and tax, excluding the 

impact of material items.

The Australasian business generated $799 million  
in sales, representing 37 per cent of total revenues. 
This compares with 2009 sales of $850 million  
(32 per cent of total). Segment profit, which is 
segment earnings before interest and tax, excluding 
the impact of material items, fell from $118.5 million  
Nufarm sales by geography 2010
in the 2009 financial year to $89.2 million in 2010,  
a decline of 25 per cent. 

  Australia 

27%

  North America 
Revenues in Australia fell by seven per cent to  
  South America 
$602 million. Glyphosate sales were slightly up on  
the previous year, but on much stronger volumes.

  Europe 

  Asia 

Climatic conditions in Australia varied throughout  
the period, with the first half affected by reduced 
summer cropping activity and second half autumn 

  New Zealand 

26%

16%

22%

7%

2%

Nufarm sales by geography 2009

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

Sales by key products 2010

09

Sales by key products  2009

  Other herbicides  21%

  Other herbicides  20%

  Glyphosate 

  Phenoxies 

  Insecticides 

  Fungicides 

  Other* 

28%

22%

8%

10%

11%

* Other: includes plant growth regulators, adjuvants, 

  seed treatments, seeds,  spray machinery and 

* Other: includes plant growth regulators, adjuvants, 

  seed treatments, seeds,  spray machinery and 

  industrial sales.

  industrial sales.

300

250

200

150

150

100

50

s

n

o

i

l

l

i

m

$

  Australia 

  North America 

  South America 

  Europe 

  Asia 

  New Zealand 

24%

29%

15%

24%

6%

2%

  Glyphosate 

  Phenoxies 

  Insecticides 

  Fungicides 

  Other* 

31%

21%

8%

7%

13%

 
 
 
 
 
 
 
 
 
business review continued

and winter conditions being positive in the eastern 
and southern states and poor in Western Australia.
Volume demand over the full year was relatively 
strong, but strong competition had a negative impact 
on pricing and margins. Nufarm’s distribution customers 
also operated on lower than normal inventories and 
this affected the working capital position.

Nufarm introduced a number of new horticultural 
products and performed strongly in this segment. 
High sugar prices also saw increased plantings in  
the cane growing regions and the company’s Crop 
Care division benefited from those additional sales 
opportunities.

New Zealand sales declined by two per cent in local 
currency, with the majority of this decrease attributable 
to lower value glyphosate sales. In New Zealand the 
drought in many regions, a cessation of dairy expansion 
and farmer focus on debt reduction through cautious 
spending had an adverse effect on the market. Retailers 
adopted ambitious inventory reduction plans, which 
further limited opportunities to generate profitable sales.

In Asia, Nufarm expanded its sales activity into a 
number of markets. The Asian business contributed  
a stronger profit result on lower sales, with margin 
improvements in markets such as Indonesia and 
Japan driving that result. Indonesia performed  
particularly strongly, with higher than average rainfalls 
leading to strong herbicide demand and a broader 
product portfolio securing increased market share  
in the plantation segment.

A long and severe winter delayed cropping  
activity in the US, with spring rains also reducing  
the pre-seeding herbicide market in key regions.  
The glyphosate segment continued to experience 
price reductions and strong competition, with smaller 
traders discounting product offerings as they cleared 
remaining inventories in July. With prices beginning 
to stabilise at lower levels and major suppliers having 
worked through higher cost inventory positions,  
it is expected that a number of smaller glyphosate 
suppliers will now leave the market.

Non-glyphosate sales increased by 15 per cent  
(in USD) in the US in the 2010 reporting period.

Hot and humid weather in some areas led to increased 
disease and insect pressure and Nufarm was able  
to capitalise on those conditions with its sales in the 
turf and ornamentals segment increasing by some  
25 per cent. An expanded portfolio of cotton products 
also saw growth in that segment.

US distribution began the year with relatively high 
stock positions but aggressively ran these down 
during the main selling season and finished the  
period with lower than normal inventories.

In Canada, very heavy rainfalls and flooding  
dramatically reduced cropping activity in the  
western regions, with the total cropped area in 
Canada being the lowest in 10 years. This significantly 
reduced demand for crop protection products and  
led to increased competition in many segments. 
Nufarm’s Canadian sales were down by 17 per cent  
in local currency.

North America

Revenue 
Segment profit* 

2010 
$ million 

2009 
$ million

554  
33.2 

775
112.2

South America

*  Segment earnings before interest and tax, excluding the 

impact of material items.

Revenue 
Segment profit* 

2010 
$ million 

2009 
$ million

342 
(14.6) 

415
(40.8)

On a segment reporting basis, North American  
sales were down by almost 29 per cent on the 
previous year ($554 million versus $775 million).  
The region generated 25.5 per cent of total  
revenues (2009: 29 per cent). Segment profit  
was $33.2 million (2009: $112.2 million). 

Nufarm’s US sales declined by 10 per cent in local 
currency to $393 million. Glyphosate sales were 
down by 44 per cent and comprised 28 per cent  
of total sales. 

*  Segment earnings before interest and tax, excluding the 

impact of material items.

South American segment sales in 2010 were  
$342 million. The region recorded a segment loss  
of $14.6 million. This compared to a segment loss  
in 2009 of nearly $41 million. 

In local currency, Brazil sales were down by 15 per cent 
to 426 million Reals (R$). Glyphosate was 34 per cent 
of total sales in Brazil (2009: 39 per cent). Excluding 
glyphosate sales, revenues in Brazil declined by just 
under four per cent. 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

10

 
 
 
 
 
 
 
 
 
business review continued

New suppliers entering the Brazilian market over 
recent years have led to increased competition  
in a number of segments, affecting glyphosate  
and several other products. During the period of 
volatile glyphosate pricing, Nufarm provided various 
forms of support to its distribution customers in  
Brazil and this had a severe impact on profitability  
during the year.

cool and dry spring also dampened demand in some 
markets. Grower purchases of crop protection inputs 
were down by between 10 and 20 per cent in some 
of the larger European markets.

In Germany, the cereal herbicide market was down by 
about nine per cent and the potato fungicide market 
saw sales decline by almost 50 per cent.

Credit risk also remained a key issue for much of the 
year and this restricted Nufarm’s selling opportunities. 

The reduced demand also affected Nufarm’s European-
based manufacturing operations with lower production 
volumes resulting in under-recoveries in those plants.

Brazil generated a loss of R$25.8 million at the 
operating EBIT level versus a loss of R$49.7 million 
the previous year.

The company strengthened its position in insecticides 
with the launch of ‘Nuprid’ (imidacloprid) and continued 
to expand in the pasture segment. A number of other 
new product launches improved the balance of the 
portfolio between herbicides, insectides and fungicides.

Nufarm appointed a new regional manager for South 
America in March, 2010, and commenced a review  
of its Brazilian business. A number of changes were 
implemented during the balance of the period, 
including a restructure and expansion of the  
company’s sales force.

Sales in Argentina increased by some 16 per cent in 
local currency with an improved product mix generating 
stronger margins and a better EBIT performance than 
in the previous year. Nufarm’s businesses in both Chile 
and Colombia also generated improved performances.

Europe

Revenue 
Segment profit* 

2010 
$ million 

2009 
$ million

475 
53.4 

637
118.8

*  Segment earnings before interest and tax, excluding the 

impact of material items.

European sales fell by 25 per cent to $475 million 
(21.9 per cent of total revenues versus 24 per cent  
in 2009). Measured in Euros, sales declined by nine  
per cent. Segment profit, at $53.4 million, was 
substantially down on the previous year  
($118.8 million). 

Climatic conditions in Europe had an adverse impact 
on demand for Nufarm’s product range. The financial 
year commenced with a dry autumn and was followed 
by long and harsh winter conditions. A generally  

In past years European markets had been relatively 
protected from competition from Chinese-sourced 
glyphosate and margins were strong. The increased 
competition in the glyphosate segment has resulted 
in a substantial drop in the profitability of this segment 
in Nufarm’s European business. This is despite 
glyphosate being a comparatively small proportion  
of total sales in Europe (2010: 13 per cent). 

Overall sales declined in most of its European markets, 
with the biggest falls recorded in France and Germany. 
Market shares, however, were maintained in most 
countries and there were some gains in markets such 
as the UK (where branded products increased year  
on year), Spain, the Nordics region and Eastern 
Europe. These gains were driven by new product 
introductions and increased support from local 
distribution customers. 

Nufarm launched its Ukraine business in October 
2009 and generated good first season sales. Sales  
in Romania were up by 20 per cent in local currency 
and 10 new product registrations in Poland helped 
secure market share gains.

Seeds

While remaining a relatively small business within 
Nufarm, the Nuseed business expanded strongly 
during 2010. This expansion was driven by both 
organic growth – particularly in Australia – and by  
the additions of newly acquired operations in the  
US and Argentina. The seeds business recorded  
total revenues of $42.5 million and a gross margin  
of more than 40 per cent.

Seasonal conditions in Australia favoured larger 
canola plantings. Nuseed launched three new 
Roundup Ready® canola products, coinciding with  
the Western Australian government’s decision to  
lift a moratorium on genetically modified canola.  
Total Australian Roundup Ready® canola plantings 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

11

 
 
 
 
 
 
 
 
Total new products* revenue
Total new products* revenue

Total new products* revenue
Total new products* revenue

Total new products* revenue
Total new products* revenue

Total new products* revenue
Total new products* revenue

business review continued

300
300
250
250
200
200
150
150
150
150
100
100
50
50

300
300
250
250
200
200
150
150
150
150
100
one director to the Nufarm board. That appointment 
100
has not yet been made as both companies continue  
50
to address certain regulatory approvals relating to  
50
the appointment.

7
0
0
7
2
0
0
2
Actual
The Sumitomo investment has also facilitated  
Actual
a number of commercial agreements between 
Nufarm and Sumitomo relating to product distribution 
and product development. Completed agreements 
include arrangements that result in Sumitomo 
products being distributed by Nufarm in markets 
including Brazil and Indonesia.

6
0
0
6
2
0
0
2
Trend line
Trend line

6
0
0
6
2
0
0
2
Trend line
Trend line

7
0
0
7
2
0
0
2
Actual
Actual

s
n
o
s
i
n
l
l
o
i
m
i
l
l
i
$
m
$

s
n
o
s
i
n
l
l
o
i
m
i
l
l
i
$
m
$

8
0
0
8
2
0
0
2

8
0
0
8
2
0
0
2

9
0
0
9
2
0
0
2

9
0
0
9
2
0
0
2

0

1

0

0

2

1

0

2

0

1

0

0

2

1

0

2

Continuous average growth rate – 53%
Continuous average growth rate – 53%

Continuous average growth rate – 53%
Continuous average growth rate – 53%

* Products launched by Nufarm within the past five years.
* Products launched by Nufarm within the past five years.

* Products launched by Nufarm within the past five years.
* Products launched by Nufarm within the past five years.

increased from about 40,000 hectares in 2009 to 
approximately 140,000 hectares in the 2010 season. 
Nuseed increased its market share in this segment.

6
0
0
6
2
0
0
2

9
0
0
9
2
0
0
2

0
1
0
0
2
1
0
2

0
1
0
0
2
1
0
2

9
0
0
9
2
0
0
2

8
0
0
8
2
0
0
2

7
0
0
7
2
0
0
2
Trend line
Trend line

6
0
0
6
2
0
0
2
Trend line
Trend line

8
7
0
0
0
0
8
7
2
2
0
0
0
0
Nuseed now breeds and markets its core canola, 
2
2
Actual
Actual
sorghum and sunflower varieties in more than  
Actual
Actual
Continuous average growth rate – 53%
Continuous average growth rate – 53%
25 countries from operational bases in Australia,  
Continuous average growth rate – 53%
Continuous average growth rate – 53%
* Products launched by Nufarm within the past 
* Products launched by Nufarm within the past 
the US and Argentina.
  five years.
  five years.
* Products launched by Nufarm within the past 
* Products launched by Nufarm within the past 
  five years.
  five years.
Sumitomo investment and cooperation

On 15 April 2010, Sumitomo Chemical Company 
(Sumitomo) completed a tender offer to acquire  
20 per cent of the issued capital in Nufarm at a  
price of $14 per share. In an associated agreement 
with Nufarm, Sumitomo has the right to appoint  

Nufarm sales by geography 2010
Nufarm sales by geography 2010

Nufarm sales by geography 2010
Nufarm sales by geography 2010

  Australia 
  Australia 
  Australia 
  Australia 
  North America 
  North America 
  North America 
  North America 
  South America 
  South America 
  South America 
  South America 
  Europe 
  Europe 
  Europe 
  Europe 
  Asia 
  Asia 
  Asia 
  Asia 
  New Zealand 
  New Zealand 
  New Zealand 
  New Zealand 

27%
27%
26%
26%
16%
16%
22%
22%
7%
7%
2%
2%

27%
27%
26%
26%
16%
16%
22%
22%
7%
7%
2%
2%

Nufarm sales by geography 2009
Nufarm sales by geography 2009

Nufarm sales by geography 2009
Nufarm sales by geography 2009

  Australia 
  Australia 
  Australia 
  Australia 
  North America 
  North America 
  North America 
  North America 
  South America 
  South America 
  South America 
  South America 
  Europe 
  Europe 
  Europe 
  Europe 
  Asia 
  Asia 
  Asia 
  Asia 
  New Zealand 
  New Zealand 
  New Zealand 
  New Zealand 

24%
24%
29%
29%
15%
15%
24%
24%
6%
6%
2%
2%

24%
24%
29%
29%
15%
15%
24%
24%
6%
6%
2%
2%

Sales by key products 2010
Sales by key products 2010

Sales by key products 2010
Sales by key products 2010
28%
  Glyphosate 
28%
  Glyphosate 
28%
  Glyphosate 
28%
  Glyphosate 
22%
  Phenoxies 
22%
  Phenoxies 
22%
  Phenoxies 
22%
  Phenoxies 
  Other herbicides  21%
  Other herbicides  21%
  Other herbicides  21%
  Other herbicides  21%
  Insecticides 
8%
  Insecticides 
8%
8%
  Insecticides 
8%
  Insecticides 
10%
  Fungicides 
10%
  Fungicides 
10%
  Fungicides 
10%
  Fungicides 
11%
  Other* 
11%
  Other* 
11%
  Other* 
11%
  Other* 

Sales by key products  2009
Sales by key products  2009

Sales by key products  2009
Sales by key products  2009
31%
  Glyphosate 
31%
  Glyphosate 
31%
  Glyphosate 
31%
  Glyphosate 
21%
  Phenoxies 
21%
  Phenoxies 
21%
  Phenoxies 
21%
  Phenoxies 
  Other herbicides  20%
  Other herbicides  20%
  Other herbicides  20%
  Other herbicides  20%
  Insecticides 
8%
  Insecticides 
8%
8%
  Insecticides 
8%
  Insecticides 
7%
  Fungicides 
7%
  Fungicides 
7%
  Fungicides 
7%
  Fungicides 
13%
  Other* 
13%
  Other* 
13%
  Other* 
13%
  Other* 

* Other: includes plant growth regulators, adjuvants, 
* Other: includes plant growth regulators, adjuvants, 
  seed treatments, seeds,  spray machinery and 
  seed treatments, seeds,  spray machinery and 
* Other: includes plant growth regulators, adjuvants, 
* Other: includes plant growth regulators, adjuvants, 
  industrial sales.
  industrial sales.
  seed treatments, seeds,  spray machinery and 
  seed treatments, seeds,  spray machinery and 
  industrial sales.
  industrial sales.

* Other: includes plant growth regulators, adjuvants, 
* Other: includes plant growth regulators, adjuvants, 
  seed treatments, seeds,  spray machinery and 
  seed treatments, seeds,  spray machinery and 
* Other: includes plant growth regulators, adjuvants, 
* Other: includes plant growth regulators, adjuvants, 
  industrial sales.
  industrial sales.
  seed treatments, seeds,  spray machinery and 
  seed treatments, seeds,  spray machinery and 
  industrial sales.
  industrial sales.

300
300
250
250
200
200
150
150
150
150
100
100
50
50

s
n
o
s
i
n
l
l
o
i
m
i
l
l
i
$
m
$

300
300
250
250
200
200
150
150
150
150
100
100
50
50

s
n
o
s
i
n
l
l
o
i
m
i
l
l
i
$
m
$

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

12

 
 
 
 
 
 
 
 
 
 
 
 
 
0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

13

 
 
 
 
 
LTIFR 2004-2009

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

Target

Actual

LTIFR 2004-2009

MTIFR 2004-2009

10

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

Target

Actual

Target

Actual

MTIFR 2004-2009

Severity 2004-2009

5

4

3

2

1

0

8

6

4

2

0

0.10

0.05

5

4

3

2

1

0

10

8

6

4
health, safety and environment

2

0

4
0
0
2

5
0
0
2

6
0
0
2

7
0
0
2

8
0
0
2

9
0
0
2

0

4
0
0
2

5
0
0
2

6
0
0
2

7
0
0
2

8
0
0
2

9
0
0
2

Target

Actual

When organisations are faced with significant 
operational and business challenges, it is often  
all too easy to lose focus on areas such as safety  
and environmental performance. During the calendar 
Severity 2004-2009
year 2009, Nufarm’s performance in these critically 
important areas was excellent and extends a strong 
0.10
trend of continuous improvement.

In 2009, for the first time, the target limits set  
by Nufarm’s board have been bettered globally  
for all categories: 
0.05

• lost time injuries;

• medical treatment injuries; and 

• severity.

0

4
0
0
2

5
0
0
2

6
0
0
2

7
0
0
2

8
0
0
2

9
0
0
2

Target

Actual

Unusual incident report/injury report 
vs LTIFR 2004-2009
LTIFR 2004-2009
14
5

12
4
10

3

8

6

4

2

0

2

1
R
F
I
T
0
L

4
0
0
2

4
0
0
2

5
0
0
2

5
0
0
2

6
6
0
0
0
0
2
2

7
7
0
0
0
0
2
2

8
0
0
2

8
0
0
2

12

10

8

6

4

2

0
9
0
0
2

9
0
0
2

o
i
t
a
r
R

I
/

I

R
U

Target

Actual

Affecting and reinforcing the cultural change necessary 
to influence the people’s behaviour in safety awareness 
is a long term project. Over the past 10 years we 
have achieved a 10 fold reduction in injuries across 
Unusual incident report/injury report 
the company, improving from 13 injuries with lost 
vs LTIFR 2004-2009
LTIFR 2004-2009
time per million hours worked to a low of 1.6 in 2009.
12
14
5

12
4
10

Our current performance on key safety parameters 
places Nufarm in the top quartile of industrial 
companies in both Australia and Europe. 

3

8

10

8

6

4

6

2

Each year, the company sets new targets aimed  
at driving further improvements and supports 
management initiatives within our various global 
1
2
operations to meet those targets. These initiatives 
R
F
T
0
L

4

2

0

I

o
i
t
a
r
R

I
/

I

R
U

4
0
0
2

4
0
0
2

5
0
0
2

5
0
0
2

6
6
0
0
0
0
2
2

7
7
0
0
0
0
2
2

8
0
0
2

8
0
0
2

0
9
0
0
2

9
0
0
2

LTIFR

Target

UIR/IR ratio

Actual

Production volume 2004-2009
MTIFR 2004-2009
10

500

8

6

4
s
e
n
n
o
2
t
0
0
0
‘

0

450

400

350

300

250

4
0
0
2

4
0
0
2

5
0
0
2

5
0
0
2

6
0
0
2

6
0
0
2

7
0
0
2

7
0
0
2

8
0
0
2

8
0
0
2

9
0
0
2

9
0
0
2

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

14

Target

LTIFR

Actual

UIR/IR ratio

Target

Actual

Production volume 2004-2009
MTIFR 2004-2009
10

500

Water efficiency 2004-2009
Severity 2004-2009
4
0.10

8

6

4
s
e
n
n
o
2
t
0
0
0
‘

0

450

400

350

300

250

4
0
0
2

4
0
0
2

5
0
0
2

5
0
0
2

6
0
0
2

6
0
0
2

7
0
0
2

7
0
0
2

8
0
0
2

8
0
0
2

9
0
0
2

9
0
0
2

3

t
c
u
d
o
r
p
e
2
n
n
0.05
o
t
/
r
e
t
a
w
s
e
n
n
o
t

1

0
0

4
0
0
4
2
0
0
2

5
0
0
5
2
0
0
2

6
0
0
6
2
0
0
2

7
0
0
7
2
0
0
2

8
0
0
8
2
0
0
2

9
0
0
9
2
0
0
2

Target

Actual

Target

Actual

Water efficiency 2004-2009

Severity 2004-2009

CO2 released from energy use and 

processes 2004-2009

Unusual incident report/injury report 

220

vs LTIFR 2004-2009

12

10

8

6

4

2

0

o

i

t

a

r

9

R

0

I

/

0

R

2

I

U

4

0

4

0

0

2

0

2

5

0

5

0

0

2

0

2

6

0

6

0

0

2

0

2

7

0

7

0

0

2

0

2

8

0

8

0

0

2

0

2

9

0

9

0

0

2

0

2

Target

Actual

4

0

0

2

4

0

0

2

5

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

LTIFR

UIR/IR ratio

CO2 released from energy use and 

processes 2004-2009

Unusual incident report/injury report 

220

vs LTIFR 2004-2009

Production volume 2004-2009

4

0

0

2

4

0

0

2

5

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

LTIFR

UIR/IR ratio

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

Production volume 2004-2009

Water efficiency 2004-2009

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

Water efficiency 2004-2009

CO2 released from energy use and 

processes 2004-2009

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

CO2 released from energy use and 

processes 2004-2009

12

10

8

6

4

2

0

o

i

t

a

r

R

9

I

0

/

0

R

I

2

U

200

14

180

12

10

160

140

120

100

2

8

6

4

0

e

n

n

o

t

0

0

0

‘

R

F

I

T

L

500

450

400

350

300

250

s

e

n

n

o

t

0

0

0

‘

4

3

2

1

0

t

c

u

d

o

r

p

e

n

n

o

t

/

r

e

t

a

w

s

e

n

n

o

t

220

200

180

160

140

e

n

n

o

t

0

0

0

‘

120

100

0.10

4

3

2

1

0

0

0.05

o

t

c

u

d

o

r

p

e

n

n

t

/

r

e

t

a

w

s

e

n

n

o

t

200

14

12

180

10

160

140

120

100

2

8

6

4

0

e

n

n

o

t

0

0

0

‘

R

F

I

T

L

500

450

400

350

300

250

s

e

n

n

o

t

0

0

0

‘

4

3

2

1

0

t

c

u

d

o

r

p

e

n

n

o

t

/

r

e

t

a

w

s

e

n

n

o

t

220

200

180

160

140

e

n

n

o

t

0

0

0

‘

120

100

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
LTIFR 2004-2009

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

Target

Actual

MTIFR 2004-2009

10

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

Target

Actual

Severity 2004-2009

LTIFR 2004-2009

0

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

Target

Actual

Target

Actual

Unusual incident report/injury report 

vs LTIFR 2004-2009

LTIFR 2004-2009

MTIFR 2004-2009

5

4

3

2

1

0

8

6

4

2

0

0.10

0.05

5

14

12
4

10

3

8

5

4

3

2

1

0

10

8

6

12

10

8

health, safety and environment continued
2

6

4

6

4

2

0
9
0
0
2

9
0
0
2

o
i
t
a
r
R

I
/

I

R
U

2

0

4
0
0
2

5
0
0
2

6
0
0
2

7
0
0
2

8
0
0
2

9
0
0
2

4

2

0

1

R
F
I
T
0
L

4
0
0
2

4
0
0
2

5
0
0
2

5
0
0
2

6
6
0
0
0
0
2
2

7
7
0
0
0
0
2
2

8
0
0
2

8
0
0
2

LTIFR

Target

Actual

UIR/IR ratio

take various forms in different locations and local 
initiatives are supported by comprehensive internal 
audits to address local areas of improvement  
and change. 
Production volume 2004-2009
MTIFR 2004-2009
Our efforts to reduce the impact of our operations on 
10
the environment continue to show positive progress. 
While many of the ‘easy wins’ have been secured, 
we are continuing to identify ways to optimise our 
use of water and energy and to reduce our generation 
of waste and emissions. 

500

450

400

8

6

350

4
Nufarm 2010 targets
s
e
300
n
LTIFR  
n
2
o
t
MTIFR  
0
0
250
Severity 
0
‘
0

1.60
3.21
0.019

4
0
0
2

4
0
0
2

5
0
0
2

5
0
0
2

6
0
0
2

6
0
0
2

7
0
0
2

7
0
0
2

8
0
0
2

8
0
0
2

9
0
0
2

9
0
0
2

Target

Actual

Water efficiency 2004-2009
Severity 2004-2009
4
0.10

3

t
c
u
d
o
r
p
e
2
n
n
0.05
o
t
/
r
e
t
a
w
s
e
n
n
o
t

1

0
0

4
0
4
0
0
2
0
2

5
0
5
0
0
2
0
2

6
0
6
0
0
2
0
2

7
0
7
0
0
2
0
2

8
0
8
0
0
2
0
2

9
0
9
0
0
2
0
2

Target

Actual

LTIFR or ‘lost time injury frequency rate’ is the number 
of lost time injuries per million hours worked that 
result in one or more day’s absence from work.

MTIFR or ‘medical treatment injury frequency rate’  
Severity 2004-2009
is the number of lost time injuries plus those that  
0.10
did not result in lost time but required treatment  
by a qualified medical practitioner per million  
hours worked.

Severity is the number of days lost due to injuries 
per thousand hours worked. We include employees, 
0.05
contractors and visitors in our statistics.

0

Nufarm’s 11th annual health, safety and environment 
report may be downloaded from the corporate website, 
together with separate reports from manufacturing 
sites around the world. The report covers 2009 calendar 
year. The health and safety data includes permanent 
and casual employees, as well as contractors.

Actual

Target

8
0
0
2

6
0
0
2

5
0
0
2

9
0
0
2

4
0
0
2

7
0
0
2

Unusual incident report/injury report 
vs LTIFR 2004-2009

14

12

10

8

6

4

2

0

R
F
I
T
L

12

10

8

6

4

2

0

o
i
t
a
r
R

I
/

I

R
U

4
0
0
2

5
0
0
2

6
0
0
2

7
0
0
2

8
0
0
2

9
0
0
2

Target

Actual

LTIFR

UIR/IR ratio

‘

I

I
/

0

R
U

100
2

9
0
0
2

e
n
n
o
t

120
4

o
i
t
a
r
R

0
0
0
R
F
I
T
L

10
160
8
140
6

CO2 released from energy use and 
processes 2004-2009
Unusual incident report/injury report 
vs LTIFR 2004-2009

220

200
14

12
180

12

10

8

6

4

2

0

4
0
0
2

4
0
0
2

5
0
0
2

5
0
0
2

6
0
0
2

7
0
0
2

8
0
0
2

6
0
0
2

7
0
0
2

8
0
0
2

9
0
0
2

LTIFR

UIR/IR ratio

Production volume 2004-2009

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

15

4
0
0
2

5
0
0
2

6
0
0
2

7
0
0
2

8
0
0
2

9
0
0
2

500

450

400

350

300

250

s
e
n
n
o
t
0
0
0

‘

4

3

2

1

0

t

c

u

d

o

r

p

e

n

n

o

t

/

r

e

t

a

w

s

e

n

n

o

t

220

200

180

160

140

e

n

n

o

t

0

0

0

‘

120

100

Production volume 2004-2009

Water efficiency 2004-2009

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

Water efficiency 2004-2009

CO2 released from energy use and 

processes 2004-2009

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

CO2 released from energy use and 

processes 2004-2009

500

450

400

350

300

250

s

e

n

n

o

t

0

0

0

‘

4

3

2

1

0

t

c

u

d

o

r

p

e

n

n

o

t

/

r

e

t

a

w

s

e

n

n

o

t

220

200

180

160

140

e

n

n

o

t

0

0

0

‘

120

100

4

0

0

2

5

0

0

2

6

0

0

2

7

0

0

2

8

0

0

2

9

0

0

2

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
management team

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

16

Doug Rathbone AM

Managing director and chief executive 

Doug Rathbone’s background is chemical engineering 
and commerce and he has worked for Nufarm Australia 
Ltd for 37 years. Doug was appointed managing director 
of Nufarm Australia in 1982 and managing director of 
Nufarm Ltd in October 1999. He joined the board of 
directors in 1987. He was appointed to the board of 
CSIRO in 2007 and retired from the CSIRO board in 
September 2010.

Brian Benson

Group general manager agriculture 

Brian Benson joined Nufarm in 2000, bringing  
with him extensive experience in the crop protection 
industry in the areas of international marketing and 
strategy. He has degrees in agricultural science  
and business administration. Brian is responsible  
for Nufarm’s regional sales operations and  
commercial strategy. 

Rodney Heath

Group general manager corporate services  
and company secretary 

Rod Heath has a bachelor of law and joined the 
company in 1980, initially as legal officer, later 
becoming assistant company secretary. In 1989,  
Rod moved from New Zealand to Australia to become 
company secretary of Nufarm Australia Ltd. In 2000, 
Rod was appointed company secretary of Nufarm Ltd. 

Kevin Martin

Chief financial officer 

Kevin Martin is a chartered accountant with over  
27 years of experience in the professional and 
commercial arena. After joining Nufarm in 1994,  
he was responsible initially for the financial control  
of the crop protection business. Since 2000, Kevin 
has been responsible for all financial, treasury  
and taxation matters for the group. 

Dale Mellody

Group general manager marketing and president  
North America

Dale Mellody joined Nufarm as a territory manager  
in 1995, having completed his bachelor of agricultural 
science. Promoted to head office in 1997, he has  
had various roles in the global marketing group and 
has assisted with a number of company acquisitions. 
Dale was promoted to the senior management group 
in July 2005 and is responsible for Nufarm’s global 
marketing. 

 
 
 
 
 
management team continued

Bob Ooms

Group general manager chemicals 

Bob Ooms joined the company in 1999. An industrial 
chemist by training, he has more than 40 years 
experience in the chemical industry in a variety of 
positions, including many years in senior management. 
Bob has executive management responsibility for 
global supply chain issues.

Mike Pointon

Group general manager innovation  
and development

Mike Pointon joined Nufarm in 2001 and was 
responsible for Nufarm’s southern European  
business based in France. He has a degree in 
agricultural science and over 25 years experience  
in the crop protection industry. Most recently based 
in Melbourne with responsibility for Nufarm’s global 
glyphosate business, Mike was appointed to the 
executive team in July 2008. He is responsible  
for the group’s product development and  
regulatory affairs activities.

David Pullan

Group general manager operations 

David Pullan joined the company in 1985. A mechanical 
engineer, David has extensive experience in chemical 
synthesis and manufacturing, having held a variety  
of operational and management positions in the oil 
and chemical industries. David is responsible for all of 
Nufarm’s global manufacturing and production sites. 

Robert Reis

Group general manager corporate strategy  
and external affairs 

A former journalist, political adviser and lobbyist, 
Robert joined Nufarm in 1991. Robert is responsible 
for global issues management, investor relations, 
media, government and stakeholder relations. Robert 
also has executive management responsibility  
for corporate strategy, human resources and  
organisational development. 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

17

 
 
 
 
 
board of directors

Pictured from left to right: Donald McGauchie AO (Chairman, appointed 13 July 2010), Bob Edgar, John Stocker AO, 
Kerry Hoggard (Chairman, retired 13 July 2010), Doug Rathbone AM (Managing director and chief executive),  
Doug Curlewis (Deputy chairman), Bruce Goodfellow, Garry Hounsell.

Donald McGauchie AO 

Kerry Hoggard 

Chairman (appointed 13 July 2010)

Chairman (retired 13 July 2010)

DG (Donald) McGauchie AO, 60, joined the board in 
2003 and was appointed chairman on 13 July 2010. 

Kerry Hoggard, 69, joined the board in 1987. 

He has a financial background, beginning his  
career with the company in 1957 as office junior  
and rising, through a number of accounting, financial 
and commercial promotions to be chief executive 
officer in 1987. He was appointed chairman of the 
board in October 1999 and retired on 13 July 2010.

He has wide commercial experience within the  
food processing, commodity trading, finance and 
telecommunication sectors. He also has extensive 
public policy experience, having previously held 
several high-level advisory positions to the government 
including the Prime Minister’s Supermarket to Asia 
Council, the Foreign Affairs Council and the Trade 
Policy Advisory Council. Donald is chairman  
of Australian Agricultural Company Ltd. He is  
a director of James Hardie Industries SE and  
Graincorp Ltd. In the past three years Donald  
has been a director of Telstra Ltd (11 years).

Donald is chairman of the nomination committee 
(effective 28 September 2010) and a member  
of the remuneration committee.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

18

 
 
 
 
 
board of directors continued

Doug Curlewis

Deputy chairman

GDW (Doug) Curlewis, 69, joined the board in 
January 2000. 

He has a master of business administration and was 
formerly managing director of National Consolidated 
Ltd. In the past three years Doug has been a director 
of Pacifica Group Ltd (nine years), Remunerator 
Australia Pty Ltd (seven years), GUD Holdings Ltd  
(six years), Graincorp Ltd (three years) and Sigma 
Pharmaceuticals Ltd (three years). 

Doug is deputy chairman of the board and a member 
of the audit, remuneration and nomination committees.

Doug Rathbone AM

Managing director and chief executive

Doug Rathbone AM, 64, joined the board in 1987. 

His background is chemical engineering and  
commerce and he has worked for Nufarm Australia 
Ltd for 37 years. Doug was appointed managing 
director of Nufarm Australia in 1982 and managing 
director of Nufarm Ltd in October 1999.

He was appointed to the board of the CSIRO in 2007 
and retired from the CSIRO board in September 2010.

Bob Edgar

Dr RJ (Bob) Edgar, 64, joined the board on 1 June 2009.

Dr Edgar holds a bachelor of economics (hons)  
from University of Adelaide and a PhD from Ohio 
State University. Bob was deputy chief executive 
officer of ANZ Banking Group, where he also held  
the positions of chief operating officer, managing 
director, institutional financial services and chief 
economist. Bob is a director of Transurban Holdings 
Ltd, Transurban Infrastructure Management Ltd, 
Asciano Ltd and Linfox Armaguard Pty Ltd. He is  
also chairman of the Prince Henry’s Institute of  
Medial Research.

Bob is chairman of the remuneration committee 
(effective 28 September 2010) and a member  
of the audit committee.

Bruce Goodfellow

Dr WB (Bruce) Goodfellow, 58, joined the board 
representing the holders of the ‘C’ shares in 1991. 
Following the conversion of the ‘C’ shares into 
ordinary shares, he was elected a director in 1999. 

He has a doctorate in chemical engineering and 
experience in the chemical trading business and 
financial and commercial business management 
experience. Bruce is chairman of Refrigeration 
Engineering Co Ltd and a director of Sanford Ltd, 
Sulkem Co Ltd, and Cambridge Clothing Co Ltd.

Bruce is a member of the nomination committee.

Garry Hounsell

GA (Garry) Hounsell, 54, joined the board in October 
2004. 

He has a bachelor of business (accounting) and  
is a former senior partner with Ernst & Young  
and a former Australian country-managing partner  
with Arthur Andersen. He has extensive experience 
across a range of areas, relating to management  
and corporate finance and has worked with some of 
Australia’s leading companies in consulting and audit 
roles, with a particular emphasis in the manufacturing 
sector. Garry is chairman of Pan Aust Ltd and deputy 
chairman of Mitchell Communication Group Ltd and  
a director of Qantas Airways Ltd, Orica Ltd and Dulux 
Group Ltd.

Garry is chairman of the audit committee.

John Stocker AO

Dr JW (John) Stocker AO, 64, joined the board  
in 1998. 

He has a medical, scientific and management 
background and was formerly chief scientist  
of the Commonwealth of Australia and formerly  
the chairman of CSIRO. He is a principal of Foursight 
Associates Pty Ltd and is a director of Telstra 
Corporation Ltd. 

In the past three years John has been chairman of 
Sigma Pharmaceuticals Ltd (four years) and a director 
of Sigma Company Ltd (eight years), Cambridge 
Antibody Technology Group plc (11 years) and 
Circadian Technologies Ltd (12 years).

John is a member of the audit committee.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

19

 
 
 
 
 
0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

20

 
 
 
 
 
corporate governance 

Introduction

Management and oversight of Nufarm

Nufarm’s board processes are under constant review 
to ensure our systems protect the interests of all 
stakeholders.

As part of this review, we consider the Corporate 
Governance Principles and Recommendations  
(‘the ASX principles’) 2nd Edition, published by  
the Australian Securities Exchange Limited’s (ASX) 
Corporate Governance Council. The board is also 
cognisant of the recent amendments to the ASX 
principles.

Copies of our corporate governance practices are 
publicly available in the corporate governance section 
of our website: www.nufarm.com

Compliance with ASX Principles

The ASX Listing Rules require Nufarm to disclose  
in our annual report the extent to which we have 
adopted the 27 best practice recommendations 
during our reporting period and, where we do not 
comply, to explain why not.

Nufarm believes it complies with all the ASX  
principles. 

We note that recommendation 2.2 recommends  
that the chairman should be an independent director. 
The chairman is elected annually at the directors’ 
meeting immediately following the annual general 
meeting (AGM). Until his retirement on 13 July 2010, 
Kerry Hoggard was chairman of the board. 

Kerry Hoggard was not deemed an independent 
director in accordance with the tests set out  
in principle 2 of the ASX principles. However,  
the board unanimously re-elected Kerry as chairman 
following the 2009 AGM believing this to be clearly  
in the best interest of all stakeholders. 

Consequent upon Kerry’s retirement on 13 July, 
Donald McGauchie was elected chairman. Donald  
is an independent director.

Doug Curlewis, an independent director, is deputy 
chairman of the board.

The board

The governing body of the company is the board  
of directors. Its clear responsibility is to oversee the 
company’s operations and ensure that Nufarm carries 
out its business in the best interests of all shareholders 
and with proper regard to the interests of all other 
stakeholders. 

The board charter clearly defines the board’s individual 
and collective responsibilities and describes those 
delegated to the managing director and senior 
executives.

The board has set specific limits to management’s 
ability to incur expenditure, enter contracts or acquire 
or dispose of assets or businesses without full board 
approval.

The board’s specific responsibility is to: 

•  ratify, monitor and review strategic plans  
for the company and its business units; 

•  approve financial and dividend policy;

•  review the company’s accounts; 

•  approve and review operating budgets; 

•  approve major capital expenditure, acquisitions, 

divestments and corporate funding; 

•  oversee risk management and internal  

compliance; and

•  control codes of conduct and legal compliance.

The board is also responsible for: 

•  the appointment and remuneration of the managing 

director; 

•  ratifying the appointment of the chief financial 

officer and the company secretary; and 

•  reviewing remuneration policy for senior executives 
and Nufarm’s general remuneration policy framework.

The board annually reviews its composition and terms 
of reference for the board, chairman, board committees 
and managing director. 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

21

 
 
 
 
 
 
 
 
corporate governance continued

There are seven scheduled board meetings board 
each year. When necessary, additional meetings are 
convened to deal with specific issues that require 
attention before the next scheduled meeting. Each 
year the board also reviews the strategic plan and 
direction of the company. 

At 31 July 2010, there are three board committees: 
audit; remuneration; and nomination. All directors  
are entitled to attend any committee meeting.

Details of the attendances at meetings of board  
and committees during the reporting period appear 
on page 30 of this report.

Evaluating the performance of senior executives

Nufarm’s senior executive team comprises a group  
of long serving career Nufarm or crop protection 
executives. The performance of the senior executive 
team is reviewed by the managing director, and then 
the remuneration committee and the board, as part  
of the annual remuneration review. In the case of the 
managing director, the remuneration committee and 
the board conduct his review.

A key consideration for the board is the company’s 
return on funds employed (ROFE) performance.

ROFE is, and has been for some 20 years, a core 
feature of Nufarm’s culture, involving many aspects 
of the company’s financial management. ROFE 
provides the senior executive with guidance as to 
how shareholder value can be increased by improving 
operating income and using capital more efficiently. 
We believe that if management concentrates on 
improving ROFE, then sustained shareholder  
value will result.

For this reason, and the profile of the senior executive 
described on pages 16 to 17, the board believes 
ROFE is the appropriate performance condition for 
the company’s senior executive incentive program. 
However, the board also reviews the company’s total 
shareholder return (TSR) performance with that of 
other peer group companies.

In the reporting period, a performance evaluation of 
senior executive was undertaken in accordance with 
this process.

The company is managed according to the  
recommendations of ASX Principle 1.

A summary of the board charter is available on  
the corporate governance section of the company’s 
website.

Board of directors

Composition

There are seven members of the board with  
a majority of independent non-executive directors  
who have an appropriate range of proficiencies, 
experience and skills to ensure that it discharges  
its responsibilities with the best possible  
management of the company in mind. 

The company’s constitution specifies that the  
number of directors may be neither less than  
three, nor more than 11. At present there are six 
non-executive directors and one executive director, 
namely the managing director, and the board has 
decided at this time that no other company  
executive will be invited to join the board.

Independence

Directors are expected to bring independent views 
and judgment to the board. The board applies the 
framework set out in ASX Principle 2 to determine 
the independence of directors. To decide whether a 
director has a material relationship with the company 
that may compromise independence, the board 
considers all relevant circumstances. 

The board reviewed the ASX principles and the 
circumstances of individual directors and believes  
it is unnecessary to define any specific materiality 
limits, except that a substantial shareholder is  
defined as one who holds or is associated directly 
with a shareholder controlling in excess of five  
per cent of the company’s equity.

Tenure

The board believes that the way directors  
discharge their responsibilities and their contribution  
to the success of the company determines their  
independence and justifies their positions.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

22

 
 
 
 
 
corporate governance continued

The nomination committee reviews the performance 
of directors who seek to offer themselves for 
re-election at a company annual general meeting 
(AGM). That committee then recommends to the 
board whether or not it should continue to support 
the nomination of the retiring directors.

The board conducts an annual review of the  
independence of directors, and at the date of this 
report, it has determined that the status of directors 
is as follows:

Independent non-executive directors

GDW Curlewis
Dr RJ Edgar
GA Hounsell 
DG McGauchie 
Dr JW Stocker 

Non-independent non-executive directors

KM Hoggard*
Dr WB Goodfellow

Executive director (chief executive officer)

DJ Rathbone

Profiles of each board member, including terms  
in office, are on pages 18 to 19 of this report.

Chairman of the board

The chairman is elected annually at the directors’ 
meeting immediately following the company’s annual 
general meeting.

As noted earlier in this report, Kerry Hoggard retired 
as chairman and a director on 13 July 2010. Donald 
McGauchie, an independent director, was then 
elected chairman. Doug Curlewis, an independent 
director, is deputy chairman.

The Nufarm board has stipulated that the role of the 
chairman and chief executive officer may not be filled 
by the same person.

The board structure is consistent with ASX Principle 2.

The nomination committee

Donald McGauchie is chairman of the nomination 
committee (effective 28 September 2010) and Doug 
Curlewis and Bruce Goodfellow are members, with  
a majority of independent directors. The committee  
is chaired by an independent director.

The formal charter setting out the committee’s 
membership requirements includes the  
responsibilities to: 

•  assess competencies of board members; 

*  Kerry Hoggard retired as chairman and a director  

•  review board succession plans; 

on 13 July 2010. 

•  evaluate board performance; and

Access to independent advice

•  recommend the appointment of new directors 

To help directors discharge their responsibilities,  
any director can appoint legal, financial or other 
professional consultants, at the expense of the 
company with the chairman’s prior approval,  
which may not be unreasonably withheld. 

The board charter provides that non-executive 
directors may meet without management present.

Conflicts of interest

Board members must identify any conflict of interest 
they may have in dealing with the company’s affairs 
and then refrain from participating in any discussion 
or voting on these matters. Directors and senior 
executives must disclose any related party  
transactions in writing.

when appropriate.

The performance of the board, its committees and 
individual directors is reviewed annually, and the 
board has utilised a variety of review processes, 
including a review by external consultants and  
a review by the chairman.

For recent reporting periods, the board has completed 
a purpose-designed questionnaire, the results of 
which were discussed with the chairman, and the 
chairman of the nomination committee, and then  
by the board as a team.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

23

 
 
 
 
 
 
 
 
 
corporate governance continued

The board ensures that new directors are introduced 
to the company appropriately, including relevant 
industry knowledge, visits to specific company 
operations and briefings by key executives.

The current share trading policy prohibits directors 
and management from dealing in the company’s 
shares at any time the directors or employees are 
aware of unpublished, price-sensitive information.

All directors may obtain independent professional 
advice and have direct access to the company 
secretary, who is appointed by, and accountable  
to, the board on all governance matters.

The operation of the board is in accordance with  
the recommendations of ASX Principle 2. 

A copy of the nomination committee charter and a 
summary of the policy and procedure for appointment 
of directors is available on the corporate governance 
section of the company’s website.

Ethical and responsible decision-making

Ethical standards

Nufarm operates in many countries and does so  
in accordance with the social and cultural beliefs  
of each country.

It is politically impartial except where the board 
believes it is necessary to comment due to any 
perceived major impact on the company, its  
business or any of its stakeholders.

We require directors, senior executives and all 
employees to adopt standards of business conduct 
that are ethical and in compliance with all legislation. 
Where there are no legislative requirements, the 
company develops policy statements relating to the 
business stakeholders to ensure appropriate standards 
and carefully selects and promotes employees.

The board endorses the principles of the Code of 
Conduct for Directors, issued by the Australian 
Institute of Company Directors.

Our formal code of conduct is available on the 
corporate governance section of the company’s 
website.

Purchase and sale of company shares 

The Nufarm board has longstanding policies about  
the purchase and sale of company shares by directors 
and key executives. 

Subject to this prohibition, directors and senior 
executives may buy or sell shares at any time except 
during the following periods:

•  six weeks before the release of the company’s  

half year results to the ASX, ending 24 hours after 
the release; 

•  six weeks before the release of the company’s year 
end results to the ASX, ending 24 hours after the 
release; and

•  two weeks before the company’s AGM, ending  

24 hours after the AGM.

Before any trading activity in company shares, 
directors and senior executives must complete  
an application form which contains a declaration 
confirming they have no relevant knowledge pertaining 
to the company that is not available to the public. On 
receipt of the application form the company secretary 
will discuss the application with the chairman to obtain 
approval to trade. No trading can be undertaken 
before the application receives the approval  
of the company secretary. 

A copy of the trading policy is available on the 
corporate governance section of the company’s 
website.

The company’s code of conduct and share trading 
policy is consistent with ASX Principle 3.

Safeguard integrity in financial reporting

Financial reports

The company has put in place a structure of review 
and authorisation to independently verify and safeguard 
the integrity of financial reporting. 

The audit committee reviews the company’s financial 
statements and the independence of the external 
auditors.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

24

 
 
 
 
 
corporate governance continued

Audit committee

Garry Hounsell is chairman of the board audit  
committee with Doug Curlewis, John Stocker and 
Bob Edgar as members. The committee comprises 
independent non-executive directors and is chaired 
by an independent director. 

Details of attendances at meetings of the audit 
committee are set out on page 30.

Garry Hounsell has a bachelor of business (accounting) 
and is a former senior partner with Ernst & Young  
and a former Australian country managing partner 
with Arthur Andersen. He has extensive experience 
across a range of areas, relating to management  
and corporate finance and has worked with some of 
Australia’s leading companies in consulting and audit 
roles, with a particular emphasis in the manufacturing 
sector. He is chairman of Pan Aust Ltd, deputy chairman 
of Mitchell Communication Group Ltd and a director 
of Qantas Airways Ltd, Orica Ltd and Dulux Group 
Ltd. Garry is also chairman of the audit committee  
at Qantas.

Doug Curlewis has an MBA and is a former managing 
director of National Consolidated Ltd, chief executive 
(Europe) of ICI Paints and managing director of Dulux 
Australia. Doug has been a director of a number of 
listed entities and has broad commercial experience.

Dr Bob Edgar holds a bachelor of economics (hons) 
from University of Adelaide and a PhD from Ohio 
State University.

Bob was deputy chief executive officer of the ANZ 
Banking Group. Bob is a director of Transurban Holdings 
Ltd, Transurban Infrastructure Management Ltd, 
Asciano Ltd and Linfox Armaguard Pty Ltd. He is also 
Chairman of the Prince Henry’s Institute of Medical 
Research.

Dr John Stocker has a medical, scientific and  
management background and was formerly chief 
scientist of the Commonwealth of Australia and 
formerly the chairman of CSIRO. He is a principal  
of Foursight Associates Pty Ltd and a director  
of Telstra Corporation Ltd. 

The committee reviews its charter annually.

The charter sets out membership requirements for 
the committee, its responsibilities and provides that the 
committee shall annually assess the external auditor’s 
actual or perceived independence by reviewing the 
services provided by the auditor. 

The charter also identifies those services that: 

•  the external auditor may and may not provide; and 

•  require specific audit committee approval. 

The committee has recommended that any former 
lead engagement partner of the firm involved in the 
company’s external audit should not be invited to fill  
a vacancy on the board and the lead engagement 
audit partner will be required to rotate off the audit 
after a maximum five years involvement and it will  
be at least two years before that partner can again  
be involved in the company’s audit.

A copy of the audit committee charter and its duties 
is available on the corporate governance section of 
the company’s website.

The financial reporting system of the company  
is consistent with ASX Principle 4.

Disclosure

The company has a detailed written policy and 
procedure to ensure compliance with both the  
ASX Listing Rules and Corporations Act. This policy  
is reviewed regularly with the company’s legal 
advisers, in line with best practice.

The company secretary prepares a schedule of 
compliance and disclosure matters for directors  
to consider at each board meeting.

A summary of the disclosure policy is available on  
the corporate governance section of the company’s 
website.

The company’s disclosure policy is consistent with 
ASX Principle 5.

Rights of shareholders

Communication

We are committed to timely, open and effective 
communication with our shareholders and the general 
investment community.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

25

 
 
 
 
 
corporate governance continued

Our communication policy aims to:

•  ensure that shareholders and the financial markets 
are provided with full and timely information about 
our activities;

•  comply with our continuous disclosure obligations;

•  ensure equality of access to briefings, presentations 
and meetings for shareholders, analysts and media; 
and

•  encourage attendance and voting at shareholder 

meetings.

Postal and electronic communication with  
shareholders includes:

•  half year and annual reports;

•  proxy voting;

•  notices of annual general meeting; 

•  relevant market announcements and related 

information; and

•  copies of webcasts and teleconferences.

Our formal communications policy is available on  
the corporate governance section of the company’s 
website.

ensure compliance with risk management controls, 
and requires management to monitor, manage and 
report on business risks.

The board has delegated the oversight of financial 
and treasury risk, including credit, liquidity and market 
risks to the audit committee which will refer any 
relevant matters to the full board. The year end 
exposure to these risks is described in note 31 
of the financial statements. 

The audit committee has approved a global risk 
management charter that specifies the responsibilities 
of the general manager global risk management 
(which includes the internal audit function). The 
charter provides authority to conduct internal audits, 
risk reviews and system-based analyses of the 
internal controls in major business systems. 

The general manager global risk management  
reports directly to the managing director, and provides 
a written report of his activities at each meeting of 
the audit committee. In so doing he has continual 
access to the chairman and members of the audit 
committee. The internal audit function is independent 
of the external auditor.

The company’s policy in relation to the rights of 
shareholders is consistent with ASX Principle 6.

All board committees report to the board on risk 
management issues within their areas of responsibility.

Identifying and managing risk

The board is committed to identifying, assessing, 
monitoring and managing its material business risks.

Nufarm’s policies and procedures relating to the 
management and oversight of risk provide effective 
management of material risks at a level appropriate  
to Nufarm’s global business.

The board annually, at its strategy review meeting, 
comprehensively reviews the material risks faced  
by the company. In so doing, it considers the interests 
of all relevant stakeholders. In addition, at each board 
meeting, management report on specific issues  
of risk and compliance, including legal compliance, 
health safety and environmental compliance and 
financial reporting.

The board has retained responsibility for the oversight 
of the company’s risk management system. The board 
ensures that appropriate policies are in place to 

The company recognises a number of operational 
risks related to its crop protection business including:

•  climate conditions and seasonality;

•  regulatory, freedom to operate, product registration, 

product use and sustainability;

•  relationships with key suppliers and customers; and 

•  licences and operating permits for manufacturing 

facilities.

The managing director and the company’s senior 
management (group general managers [GGMs]  
who report directly to the managing director) are 
responsible for the management of material risks  
in their respective areas of responsibility.

The managing director’s and GGMs’ regular reports, 
submitted for review to each board meeting, will 
include relevant commentary on any material risk. 
The board also requires the managing director and 
GGMs to provide the board, for its annual strategy 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

26

 
 
 
 
 
The committee’s formal charter includes responsibility 
to:

•  review and recommend to the board the  

remuneration packages and policies applicable  
to key executives and directors; and

•  ensure remuneration packages and policies attract, 

retain and motivate high calibre executives.

The committee reports to the board on all matters 
and the board makes all decisions, except when 
power to act is delegated expressly to the committee.

Remuneration of non-executive directors

The board’s policy with regard to non-executive 
directors remuneration is set out in the remuneration 
report on page 35.

A copy of the remuneration committee charter and 
the company policy on prohibiting senior executives 
from hedging any shares offered under the executive 
share plan are available on the corporate governance 
section of the company’s website. Nufarm’s  
remuneration policies are consistent with  
ASX Principle 8.

corporate governance continued

meeting, with a report and assurance that all material 
risks are being effectively managed. Such a report 
was received in the current reporting period.

Local and regional financial controllers complete  
half yearly certificates, which are reviewed by the 
chief financial officer and the audit committee as  
part of the company’s half year reporting to the 
market and to achieve compliance with section 295A 
of the Corporations Act. In accordance with section 
295A, the board procedures to safeguard the integrity 
of the company’s financial reporting require the chief 
executive officer and the chief financial officer to 
state in writing to the board that:

•  the company’s financial reports present a true and 
fair view, in all material respects, of the company’s 
financial condition and operational results and are in 
accordance with relevant accounting standards; and

•  the statement is founded on a sound system of risk 
management and internal compliance and control, 
which is operating effectively in all material 
respects in relation to financial reporting risks.

The board received in the current reporting period  
an assurance from the chief executive officer and 
chief financial officer that the declaration relating to 
the company’s financial reports has been made with 
due regard to appropriate risk management controls. 

A summary of the company’s policies on risk oversight 
and management of material business risks is available 
in the corporate governance section of the company’s 
website. Nufarm’s management of risk is consistent 
with ASX Principle 7.

Remuneration

The board has procedures to ensure that the level 
and structure of remuneration for executives and 
directors is appropriate.

Remuneration committee

Bob Edgar is chairman of the remuneration committee 
(effective 28 September 2010) and Donald McGauchie 
and Doug Curlewis are members, with a majority of 
independent directors. The committee is chaired by 
an independent director.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

27

 
 
 
 
 
financial statements

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

28

 
 
 
 
 
directors’ report

The directors present their report together with the financial report of Nufarm Limited (‘the company’) and of the 
group, being the company and its subsidiaries and the group’s interests in associates and jointly controlled entities, 
for the financial year ended 31 July 2010 and the auditor’s report thereon.

Directors

The directors of the company at any time during or since the end of the financial year are:

KM Hoggard* (Chairman) (retired 13 July 2010)
DG McGauchie AO* (Chairman) (appointed 13 July 2010)
GDW Curlewis (Deputy chairman)
DJ Rathbone AM (Managing director)
Dr RJ Edgar 
Dr WB Goodfellow
GA Hounsell
Dr JW Stocker AO

*  KM Hoggard retired as chairman and a director of the company on 13 July 2010. DG McGauchie was appointed chairman  

on 13 July 2010.

Unless otherwise indicated, all directors held their position as a director throughout the entire period and up to 
the date of this report. Details of the qualifications, experience and responsibilities and other directorships of the 
directors are set out on pages 18 to 19.

Company secretary

The company secretary is R Heath.

Details of the qualifications and experience of the company secretary are set out on page 16.

Directors’ interests in shares and Step-up Securities

Relevant interests of the directors in the shares and Step-up Securities issued by the company and related bodies 
corporate are, at the date of this report, as notified by the directors to the Australian Securities Exchange in 
accordance with S205G(1) of the Corporations Act 2001, as follows:

Nufarm Ltd 
ordinary shares 

Nufarm Finance (NZ) Ltd
Step-up Securities

GDW Curlewis1 
DJ Rathbone 
Dr RJ Edgar 
Dr WB Goodfellow1,2 
GA Hounsell1 
DG Mc Gauchie1 
Dr JW Stocker1 
1  The shareholdings of GDW Curlewis, Dr WB Goodfellow, GA Hounsell, DG McGauchie and Dr JW Stocker include shares 

45,913 
16,144,890 
– 
1,120,551 
43,723 
31,239 
41,521 

–
–
–
47,723
–
–
–

issued under the company’s non-executive director share plan and held by Pacific Custodians Pty Ltd as trustee of the plan.

2  The holding of Dr WB Goodfellow includes his relevant interest in:

(i) 

 St Kentigern Trust Board (430,434 shares and 19,727 Step-up Securities) – Dr Goodfellow is chairman of the Trust Board. 
Dr Goodfellow does not have a beneficial interest in these shares or Step-up Securities.

(ii)  Sulkem Company Limited (120,000 shares).

(iii)  531 Trust (400,861 shares). Dr Goodfellow and EW Preston are trustees of 531 Trust.

(iv)   Auckland Medical Research Foundation (26,558 Step-up Securities). Dr Goodfellow does not have a beneficial interest  

in these Step-up Securities.

(v)   Trustees of the Goodfellow Foundation (33,854 shares and 1,338 Step-up Securities). Dr Goodfellow is chairman of the 

Trust Board and does not have a beneficial interest in these shares or Step-up Securities.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

29

 
 
 
 
 
 
 
 
 
 
 
 
directors’ report continued

Directors’ meetings

During the financial period numerous board meetings were convened at short notice to consider issues related  
to the Sinochem takeover proposal, the Sumitomo proposal to acquire 20 per cent of the shareholding of Nufarm, 
the Extraordinary General Meeting held on 2 March 2010, the Sumitomo Tender Offer and the Accelerated Rights 
Entitlement Offer. Some directors were unable to attend some of these meetings due to prior commitments.

The number of directors’ meetings (including meetings of board committees) and number of meetings attended  
by each of the directors of the company during the financial year are:

Committees

Director

Board

Audit

Remuneration

Nomination

KM Hoggard1,2,3

GDW Curlewis 

DJ Rathbone3

Dr RJ Edgar2

Dr WB Goodfellow3

GA Hounsell3

DG McGauchie 

Dr JW Stocker3

A

16

19

19

19

19

19

19

19

B

15

18

19

18

19

19

16

18

A

1

3

–

2

–

3

–

3

B

3

3

2

2

1

3

–

3

A

2

2

–

–

–

–

2

–

B

2

2

2

–

2

2

1

–

A

–

2

–

–

2

–

2

–

B

2

2

2

–

2

2

1

–

Column A: indicates the number of meetings held during the period the director was a member of the board  
and/or committee.

Column B: indicates the number of meetings attended during the period the director was a member of the board
and/or committee.

Other meetings of committees of directors are convened as required to discuss specific issues or projects.

1  KM Hoggard retired as a director on 13 July 2010.

2  Dr RJ Edgar was appointed a member of the audit committee in September 2009. KM Hoggard retired as a member of the 

audit committee in September 2009.

3  Attended meeting although not a member of the committee. All directors are entitled to attend any committee meetings.

Principal activities and changes

Nufarm manufactures and supplies a range of agricultural chemicals used by farmers to protect crops from damage 
caused by weeds, pests and disease. The company has production and marketing operations throughout the 
world and sells products in more than 100 countries. Nufarm’s crop protection products enjoy a reputation for 
high quality and reliability and are supported by strong brands, a commitment to innovation and a focus on close 
customer relationships.

Nufarm employs in excess of 3,000 people at its various locations in Australasia, Africa, the Americas and Europe. 
The company is listed on the Australian Securities Exchange (symbol NUF). Its head office is located at Laverton 
in Melbourne.

Results

The net loss attributable to members of the group for the 12 months to 31 July 2010 is $22.6 million. The 
comparable figure for the 12 months to 31 July 2009 was a profit of $79.9 million.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

30

 
 
 
 
 
directors’ report continued

Dividends

The following dividends have been paid, declared or recommended since the end of the preceding financial year:

The final dividend for 2008–09 of 15 cents paid 13 November 2009 

Nufarm Step-up Securities distribution payment

The following Nufarm Step-up Securities distribution payments have been  
paid since the end of the preceding financial year:

Distribution payment for the period 15 April 2009 – 15 October 2009 at the rate  
of 5.0167 per cent per annum paid 15 October 2009 

Distribution payment for the period 16 October 2009 – 15 April 2010  
at the rate of 6.08 per cent per annum paid 15 April 2010 

Review of operations

$000

32,709

6,313

7,609

The review of the operations during the financial year and the results of those operations are set out in the 
managing director’s review on pages 3 to 6 and the business review on pages 9 to 12.

State of affairs

The state of the company’s affairs are set out in the managing director’s review on pages 3 to 6 and the business 
review on pages 9 to 12.

Operations, financial position, business strategies and prospects

The directors believe that information on the company, which enables an informed assessment of its operations, 
financial position, strategies and prospects, is contained in the financial accounts, managing director’s review and 
the business review.

Events subsequent to reporting date

At 31 July 2010, the group was in breach of certain covenants under the deed of negative pledge, which  
contains the covenants and other terms common to all bankers. On 27 September 2010, the group obtained 
written waivers from all parties to the deed in respect of these covenant breaches. At the same time, the  
parties to the deed confirmed that any undrawn facility amounts are no longer available to the group. The group 
has contractually obtained additional secured funding through to 15 December 2010, subject to certain conditions 
and obligations. The group is currently evaluating its options regarding the nature and terms of a new financing 
facility beyond 15 December 2010. Further details are set out in note 2(b) of the financial report.

Likely developments

The directors believe that likely developments in the company’s operations and the expected results of those 
operations are contained in the managing director’s review and the business review.

Environmental performance

Details of Nufarm’s performance in relation to environmental regulations are set out on pages 14 to 15. The company 
did not incur any prosecutions or fines in the financial period relating to environmental performance. The company 
publishes annually a health, safety and environment report. This report can be viewed on the company’s website  
or a copy will be made available upon request to the company secretary.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

31

 
 
 
 
 
 
directors’ report continued

Non-audit services

During the year KPMG, the company’s auditor, has performed certain other services in addition to their statutory 
duties. Details of the audit fee and non-audit services are set out in note 42 of the financial report.

The board has considered the non-audit services provided during the year by the auditor and in accordance with 
written advice provided by resolution of the audit committee, is satisfied that the provision of those non-audit 
services during the year by the auditor is compatible with, and did not compromise, the auditor independence 
requirements of the Corporations Act 2001 for the reason that all non-audit services were subject to the corporate 
governance procedures adopted by the company and have been reviewed by the audit committee to ensure they 
do not impact the integrity and objectivity of the auditor.

Remuneration report – audited

Remuneration committee 

The remuneration committee reviews and makes recommendations to the board on remuneration policies  
and packages applicable to key management personnel and directors and ensures that remuneration policies  
and packages retain and motivate high calibre executives and that remuneration policies demonstrate a clear 
relationship between executive remuneration and company performance.

For the financial year ended 31 July 2010, the board has resolved:

•	 the	company	did	not	achieve	the	performance	conditions	for	the	cash	component	of	the	incentive	program	 

and therefore no cash bonuses were paid to executives for the period ended 31 July 2010. Certain key executives 
were paid a ‘retention’ payment in the financial period. This retention payment was made as a consequence  
of the Sinochem proposal to acquire Nufarm. Whilst the Sinochem proposal did not ultimately proceed, it was  
a fundamental condition of the proposal that all key executives were retained. It was a condition of the retention 
payment that the executive remain in employment as at 30 August 2010, failing which the payment be repaid;

•	 the	company	did	not	achieve	the	performance	condition	for	the	share	component	of	the	incentive	program	and	

therefore no shares will be delivered to executives for the period ended 31 July 2010; and

•	 there	will	be	no	increase	in	directors’	fees	for	the	period	ending	31	July	2011.

Key management personnel include the five most highly remunerated executives in accordance with S300A of the 
Corporations Act.

The remuneration levels of the managing director and key management personnel are recommended by the 
remuneration committee and approved by the board, having taken advice from independent external advisors.

Principles of compensation 

Executives

The Nufarm remuneration policy has been developed to ensure the company attracts and retains the highly skilled 
people required to successfully manage and create shareholder value from a large diversified internationally-based 
company.

The company has adopted a remuneration policy based on total target reward (TTR), which comprises two 
components:

•	 fixed	reward	(TEC)	–	cash	and	benefits	that	reflect	local	market	conditions	and	individual	contribution.	The	reward	
level is set relative to pertinent and prevailing executive employment market conditions for high calibre talent  
in the geographies where Nufarm operates. The company’s policy position for TEC for Australian executives  
is benchmarked with reference to the 62nd percentile of similar sized companies within Mercer’s executive 
remuneration database; and

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

32

 
 
 
 
 
directors’ report continued

•	 an	incentive	program	–	upon	achievement	of	the	performance	condition	over	six	monthly	periods,	50	per	cent	
of the incentive will be paid in cash. Upon achievement of the performance condition for the full year, 50 per 
cent of the incentive will be delivered by way of shares, which, for the key management personnel, ensures  
a longer term focus to achieve benefits consistent with the delivery of sustained growth of shareholder value. 
The exception is the current managing director who is paid in cash because of the very substantial shareholding 
he currently controls in the company. 

Management personnel are not permitted to hedge any shares issued to them under the incentive program whilst 
they remain held in trust.

If the company’s financial objectives are achieved and the incentive program is paid at 100 per cent, the TTR will 
meet the company’s TTR policy position of the upper quartile of similar sized companies within Mercer’s executive 
remuneration database. Set out below are details of the maximum payment of the incentive program where there 
has been above target achievement of the incentive program performance condition.

The performance condition for the incentive program is based on return on funds employed (ROFE) in the business. 
Return is calculated on the group’s earnings before interest and taxation and adjusted for any non-operating items. 
Funds employed are represented by shareholders’ funds plus total interest bearing debt. 

The company believes ROFE is an appropriate performance condition for the following reasons:

•	 for	many	years	the	board	has	measured	the	company’s	performance	using	an	‘economic	value	added’	methodology.	
It is believed that if the company can consistently add economic value (a satisfactory margin above the cost of 
capital), then this will be recognised in share value; and

•	 ROFE	ensures	management	is	focused	on	the	efficient	use	of	capital	and	the	measure	remains	effective	

regardless of the mix of equity and debt, which may change from time to time.

The remuneration committee and the board review the level of the performance condition on an annual basis.

Whilst it believes ROFE is an appropriate performance condition for the company’s incentive program, the board 
also reviews the company’s total shareholder return (TSR) with relevant comparator groups.

Each	year,	the	board	reviews	and	establishes	the	performance	hurdle	for	the	incentive	program.	The	hurdle	reflects	
targets for specific objectives and increasing company value, consistent with the company’s business and 
investment strategies. 

The target ROFE hurdle for the incentive program for the financial period was 17.25 per cent.

At the end of each half year and financial year the board assesses company performance against target ROFE  
to determine the percentage of any offer to be made under the cash component of the incentive program.

At the end of each financial year, the board:

•	 assesses	company	performance	against	the	target	ROFE	hurdle	to	determine	the	percentage	of	any	offer	to	 

be made under the share component of the incentive program; and 

•	 reviews	target	ROFE	for	the	incentive	program	for	the	following	financial	period.

For the incentive program, 25 per cent of the incentive will be payable on achievement of 90 per cent of target 
ROFE with a linear progression to 100 per cent of the incentive on achievement of target ROFE and a maximum 
of 175 per cent of the incentive on achievement of 110 per cent of target ROFE.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

33

 
 
 
 
 
directors’ report continued

If less than 90 per cent of target ROFE is achieved, no incentive will be paid.

The following table shows the proportion of incentive as a percentage of TTR.

Managing director

Key management personnel other than non-executive directors

Consequences of performance on shareholders’ wealth

Percentage (%) target ROFE achieved

<90

0

0

90

20

14

100

110

50

40

64

54

The executive remuneration policy is designed to align remuneration with the creation of shareholder wealth. The 
incentive program links executive reward with company performance.

Target ROFE for the incentive program was not achieved for the year ended 31 July 2010 and therefore executives 
received no bonuses under the cash component of the incentive program and no shares under the share component 
of the incentive program. As set out above, key executives received a ‘retention’ payment related to the Sinochem 
takeover proposal.

Set out below is a table which summarises the company’s performance and shareholder wealth statistics over the 
last five years.

In considering the consolidated entity’s performance and benefits for shareholders’ wealth, the remuneration 
committee and the board have regard to the following indices in respect of the current financial year and the 
previous four financial years.

Operating 
EBIT
$m

ROFE 
achieved
%

EPS

Dividend 
rate
cents per share

Dividends 
paid
 $000

*Change in 
share price
 $

Share price 
31 July
$

**Total  
shareholder 
return
%

2006
2007
2008
2009
2010

 211.2
217.8
311.2 
280.3
135.2

17.8
16.6
17.2
11.7
5.5

 60.3
59.2
69.7
33.5
(15.0)

27
31
33
35
15

45,879
53,145
58,332
65,297
32,709

(1.37)
4.31
4.05
(5.86)
(7.04)

8.80
13.10
16.85
10.84
3.82

(2.3)
40
17
(41)
(37.8)

*	 This	column	reflects	the	change	in	share	price	from	1	August	to	31	July	in	the	relevant	financial	year.

**  Source: Goldman Sachs JB Were – total shareholder return as at 30 June.

Service contracts

The company has employment contracts with the managing director and the key management personnel. These 
contracts formalise the terms and conditions of employment. The contracts are for an indefinite term.

The company may terminate the contracts upon, in the case of the managing director, 12 months, and in the case 
of key management personnel, six months notice, in which case a termination payment equivalent to, in the case 
of the managing director, 24 months, and in the case of key management personnel, 12 months, total employment 
cost (base salary plus value of benefits such as motor vehicle and superannuation and any fringe benefits tax in 
relation to those benefits) will be paid. The company may terminate the employment contracts immediately for 
serious misconduct. The contracts for the managing director and key management personnel named in this report 
were entered into prior to the announcement of legislation to change termination payment limits for executives.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

34

 
 
 
 
 
directors’ report continued

Non-executive directors (NED)

The board’s policy with regard to non-executive directors remuneration is to position board remuneration at the 
market median with comparable sized listed entities.

The board determines the fees payable to non-executive directors within the aggregate amount approved from 
time to time by shareholders. At the company’s 2009 AGM, shareholders approved an aggregate of $1,600,000 
per year (including superannuation costs).

Set out below are details of the annual fees payable at 31 July 2010 (excluding superannuation costs).

 $

Chairman1 
Deputy chairman1 
Director board fees 
Chairman audit committee 
Chairman other board committees 
Member audit committee 
Member other board committees2 

290,000
170,000
115,000
25,000
10,000
5,000
2,500

The board has resolved that there will be no increases in these fees for the period ending 31 July 2011.

1  The chairman and the deputy chairman receive no fees as members of any committee.

2  There is some common membership on the remuneration committee and nomination committee. Only one fee is paid where 

a director is a member of both committees.

Remuneration of directors and executives

Details of the nature and amount of each major element of remuneration in respect of key management personnel, 
which includes each director of the company and each of the five most highly remunerated executives and relevant 
group executives who receive the highest remuneration are: 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

35

 
 
 
 
 
directors’ report continued

In AUD 
Directors 
Non-executive

KM Hoggard3 (Chairman)

GDW Curlewis (Deputy chairman) 

Dr RJ Edgar4

Dr WB Goodfellow 

GA Hounsell 

DG McGauchie 

Dr JW Stocker 

Executive director

DJ Rathbone (Managing director)

Executive officers

DA Pullan (Group general manager operations)

KP Martin (Chief financial officer) 

B Benson (Group general manager marketing) 

RF Ooms (Group general manager chemicals) 

RG Reis (Group general manager corporate 
strategy and external affairs) 

DA Mellody (Group general manager global 
marketing) 

MJ Pointon (Group general manager innovation  
and development)

R Heath (Company secretary) 

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010
2009

2010
2009

2010
2009
2010

2009

Short term

Salary and fees  
$

Cash bonus 
(vested2) 
$

Non-monetary 
benefits 
$

Post-employment

Share based  

payments

Other long term

Superannuation 

Equity settled 

Total

Total  

$

remuneration 

1

275,967

290,000

170,000

116,500

119,264

–

117,500

100,250

140,000

122,750

125,846

117,500

120,000

102,750

1,339,490

1,251,350

628,936

539,456

595,120

508,708

594,236

511,820

529,141

470,017

521,288
452,278

408,801
482,846

283,703
246,643
236,018

228,780

–

–

–

–

–

–

–

–

–

–

–

–

–

–

843,000

923,000

230,000

57,500

215,000

55,000

220,000

55,000

198,333

49,583

178,333
45,833

166,667
38,922

116,667
53,534
101,667

25,417

–

–

–

–

–

–

–

–

–

–

–

–

–

–

34,432

64,029

27,454

25,890

28,594

27,063

24,339

29,859

12,064

13,595

34,877
39,401

–
–

26,691
28,761
25,495

26,630

Total 

$

275,967

290,000

170,000

116,500

119,264

–

117,500

100,250

140,000

122,750

125,846

117,500

120,000

102,750

2,216,922

2,238,379

886,390

622,846

838,714

590,771

838,575

596,679

739,538

533,195

734,498

537,512

575,468

521,768

427,061

328,938

363,180

280,827

$

27,596

29,000

17,000

45,000

11,926

–

11,750

11,750

14,000

14,000

12,584

11,750

12,000

12,000

24,102

18,332

48,150

94,104

48,000

94,006

48,900

94,866

49,600

90,010

24,219

46,897

26,325

47,430

49,100

44,853

46,784

44,983

$

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

25,500

17,250

17,250

17,250

208,333

200,000

200,000

188,333

166,667

150,000

74,866

96,667

80,247

114,567

2,321,271

2,371,278

$

–

–

–

–

–

–

–

–

–

–

–

–

–

–

19,554

23,943

22,155

27,007

19,594

19,813

14,952

15,865

28,941

21,282

14,510

15,074

9,209

15,409

10,468

9,408

303,563

319,000

187,000

187,000

131,190

–

129,250

129,250

154,000

154,000

138,430

129,250

132,000

132,000

954,094

949,226

908,869

911,784

907,069

911,358

804,090

827,403

787,658

772,358

616,303

734,272

485,370

464,066

420,432

431,885

1  Represents total remuneration paid in the financial year.

2  The ‘retention’ payment made to key executives arising from the Sinochem takeover proposal is included in this item of cash  
bonus. It was a condition of the retention payment that the key executives remain in employment until 30 August 2010 prior  
to it vesting. If an executive ceased employment prior to 30 August 2010 then the retention payment was to be repaid in full.  
All executives remained in employment as at 30 August 2010 and therefore all cash bonuses were fully vested.

3  KM Hoggard retired as chairman and a director on 13 July 2010.

4  Dr RJ Edgar was appointed a director on 1 July 2009.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

36

 
 
 
 
 
Short term

Salary and fees  

(vested2) 

benefits 

Cash bonus 

Non-monetary 

In AUD 

Directors 

Non-executive

KM Hoggard3 (Chairman)

GDW Curlewis (Deputy chairman) 

Dr RJ Edgar4

Dr WB Goodfellow 

GA Hounsell 

DG McGauchie 

Dr JW Stocker 

Executive director

DJ Rathbone (Managing director)

Executive officers

DA Pullan (Group general manager operations)

KP Martin (Chief financial officer) 

B Benson (Group general manager marketing) 

RF Ooms (Group general manager chemicals) 

RG Reis (Group general manager corporate 

strategy and external affairs) 

DA Mellody (Group general manager global 

marketing) 

MJ Pointon (Group general manager innovation  

and development)

R Heath (Company secretary) 

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

1,339,490

1,251,350

$

275,967

290,000

170,000

116,500

119,264

–

117,500

100,250

140,000

122,750

125,846

117,500

120,000

102,750

628,936

539,456

595,120

508,708

594,236

511,820

529,141

470,017

521,288

452,278

408,801

482,846

283,703

246,643

236,018

228,780

$

–

–

–

–

–

–

–

–

–

–

–

–

–

–

843,000

923,000

230,000

57,500

215,000

55,000

220,000

55,000

198,333

49,583

178,333

45,833

166,667

38,922

116,667

53,534

101,667

25,417

$

–

–

–

–

–

–

–

–

–

–

–

–

–

–

34,432

64,029

27,454

25,890

28,594

27,063

24,339

29,859

12,064

13,595

34,877

39,401

–

–

26,691

28,761

25,495

26,630

1  Represents total remuneration paid in the financial year.

2  The ‘retention’ payment made to key executives arising from the Sinochem takeover proposal is included in this item of cash  

bonus. It was a condition of the retention payment that the key executives remain in employment until 30 August 2010 prior  

to it vesting. If an executive ceased employment prior to 30 August 2010 then the retention payment was to be repaid in full.  

All executives remained in employment as at 30 August 2010 and therefore all cash bonuses were fully vested.

3  KM Hoggard retired as chairman and a director on 13 July 2010.

4  Dr RJ Edgar was appointed a director on 1 July 2009.

directors’ report continued

Post-employment

Share based  
payments

Other long term

Total 
$

Superannuation 
$

Equity settled 
$

275,967

290,000

170,000

116,500

119,264

–

117,500

100,250

140,000

122,750

125,846

117,500

120,000

102,750

2,216,922

2,238,379

886,390

622,846

838,714

590,771

838,575

596,679

739,538

533,195

734,498
537,512

575,468
521,768

427,061
328,938
363,180

280,827

27,596

29,000

17,000

45,000

11,926

–

11,750

11,750

14,000

14,000

12,584

11,750

12,000

12,000

24,102

18,332

48,150

94,104

48,000

94,006

48,900

94,866

49,600

90,010

24,219
46,897

26,325
47,430

49,100
44,853
46,784

44,983

–

–

–

25,500

–

–

–

17,250

–

17,250

–

–

–

17,250

–

–

–

208,333

–

200,000

–

200,000

–

188,333

–
166,667

–
150,000

–
74,866
–

96,667

Total

Total  
1
remuneration 
$

303,563

319,000

187,000

187,000

131,190

–

129,250

129,250

154,000

154,000

138,430

129,250

132,000

132,000

$

–

–

–

–

–

–

–

–

–

–

–

–

–

–

80,247

114,567

2,321,271

2,371,278

19,554

23,943

22,155

27,007

19,594

19,813

14,952

15,865

28,941
21,282

14,510
15,074

9,209
15,409
10,468

9,408

954,094

949,226

908,869

911,784

907,069

911,358

804,090

827,403

787,658
772,358

616,303
734,272

485,370
464,066
420,432

431,885

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

37

 
 
 
 
 
directors’ report continued

Remuneration options: granted and vested during the year

During the year there were no options granted to directors or executives, nor were any options vested or 
exercised by the specified executives.

Shares issued as a result of the exercise of options

There were no shares issued as a result of the exercise of options during the year.

Unissued shares under option

There are no unissued shares under option.

Indemnities and insurance for directors and officers

The company has entered into insurance contracts which indemnify directors and officers of the company, and  
its controlled entities, against liabilities. In accordance with normal commercial practices, under the terms of the 
insurance contracts, the nature of the liabilities insured against and the amount of premiums paid are confidential.

An indemnity agreement has been entered into between the company and each of the directors named earlier in 
this report. Under the agreement, the company has agreed to indemnify the directors against any claim or for any 
expenses or costs which may arise as a result of the performance of their duties as directors. There are no 
monetary limits to the extent of this indemnity.

Lead auditor’s independence declaration

The lead auditor’s independence declaration is set out on page 39 and forms part of the directors’ report for the 
financial year ended 31 July 2010.

Rounding of amounts

The company is of a kind referred to in Australian Securities and Investment Commission Class Order 98/100 
dated 10 July 1998 and, in accordance with that class order, amounts in the financial statements and the directors’ 
report have been rounded off to the nearest thousand dollars, unless otherwise stated.

This report has been made in accordance with a resolution of directors.

DG McGauchie
Director

DJ Rathbone
Director

Melbourne
28 September 2010

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

38

 
 
 
 
 
 
 
lead auditor’s independence declaration 
under Section 307C of the Corporations Act 2001

To: the directors of Nufarm Limited

I declare that, to the best of my knowledge and belief, in relation to the audit for the financial year ended  
31 July 2010 there have been:

(i)  no contraventions of the auditor independence requirements as set out in the Corporations Act 2001  

in relation to the audit; and

(ii) no contraventions of any applicable code of professional conduct in relation to the audit.

KPMG

BW Szentirmay
Partner

Melbourne
28 September 2010

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

39

 
 
 
 
 
income statement
for the year ended 31 July 2010

Continuing operations
Revenue 
Cost of sales 

Gross profit 

Other income 
Sales, marketing and distribution expenses 
General and administrative expenses 
Research and development expenses 
Share of net profits of associates 

Operating result 

Note 

7 

19 

Consolidated

2010 
$000 

2009
$000

2,168,630 
(1,698,717) 

2,677,083
(2,121,446)

469,913 

555,637

8,641 
(217,617) 
(156,285) 
(38,529) 
47 

11,054
(210,914)
(162,018)
(45,375)
3,080

66,170 

151,464

Net non-cash revaluation profit/(loss) on proceeds from  
Nufarm Step-up Securities financing 

6 

3,323 

(431)

Profit before net financing costs and income tax 

69,493 

151,033

Financial income 
Financial expenses 

Net financing costs 

10 
10 

6,014 
(62,790) 

(56,776) 

8,177
(100,253)

(92,076)

Profit before income tax 

12,717 

58,957

Income tax (expense)/benefit 

11 

(35,369) 

21,585

Profit/(loss) for the period from continuing operations 

(22,652) 

80,542

Attributable to:
Equity holders of the company 
Non-controlling interest 

Profit/(loss) for the period 

Earnings per share
Basic earnings/(loss) per share 
Diluted earnings/(loss) per share 

Continuing operations
Basic earnings/(loss) per share 
Diluted earnings/(loss) per share 

(23,990) 
1,338 

79,877
665

(22,652) 

80,542

30 
30 

30 
30 

(15.0) 
(15.0) 

(15.0) 
(15.0) 

33.5
33.5

33.5
33.5

The income statement is to be read in conjunction with the attached notes.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

40

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
statement of comprehensive income 
for the year ended 31 July 2010

Net profit/(loss) for the period 

Other comprehensive income 
Foreign exchange translation differences for foreign operations 
Actuarial gains/(losses) on defined benefit plans 
Income tax on share issue costs recognised directly in equity 

Other comprehensive income/(loss) for the period,  
net of income tax 

Note 

Consolidated

2010 
$000 

2009
$000

(22,652) 

80,542

(58,698) 
(2,280) 
777 

(19,788) 
(8,454)
1,683

(60,201) 

(26,559)

Total comprehensive income/(loss) for the period 

(82,853) 

53,983

Attributable to: 
Equity holders of the company 
Non-controlling interest 

(82,875) 
22 

53,895
88

Total comprehensive income/(loss) for the period 

(82,853) 

53,983

The amounts recognised directly in equity are disclosed net of tax – see note 11 for tax effect. 

The statement of comprehensive income is to be read in conjunction with the attached notes. 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

41

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
balance sheet
as at 31 July 2010

Assets
Cash and cash equivalents 
Trade and other receivables 
Inventories 
Current tax assets 
Assets held for sale 

Total current assets 

Non-current assets
Trade and other receivables 
Investments in equity accounted investees 
Other investments 
Deferred tax assets 
Property, plant and equipment 
Intangible assets 
Other financial assets 

Total non-current assets 

TOTAL ASSETS 

Current liabilities
Bank overdraft 
Trade and other payables 
Loans and borrowings 
Employee benefits 
Current tax payable 
Provisions 

Total current liabilities 

Non-current liabilities
Payables 
Loans and borrowings 
Deferred tax liabilities 
Employee benefits 

Total non-current liabilities 

TOTAL LIABILITIES 

NET ASSETS 

Equity
Share capital 
Reserves 
Retained earnings 

Equity attributable to equity holders of the company 
Nufarm Step-up Securities 
Non-controlling interests 

TOTAL EQUITY 

The balance sheet is to be read in conjunction with the attached notes.

Note 

15 
16 
17 
18 
13 

16 
19 
20 
18 
22 
23 
21 

15 
24 
25 
26 
18 
28 

24 
25 
18 
26 

Consolidated

2010 
$000 

188,741 
852,986 
553,432 
42,461 
7,677 

2009
$000

84,312
787,760
797,383
48,973
–

1,645,297 

1,718,428

19,342 
11,964 
6,879 
150,323 
413,235 
846,759 
43 

33,125
12,468
7,442
194,960
435,468
848,739
967

1,448,545 

1,533,169

3,093,842 

3,251,597

28,036 
393,868 
766,128 
22,330 
5,565 
11,763 

35,669
407,421
584,692
20,671
17,772
26,091

1,227,690 

1,092,316

15,849 
13,633 
47,890 
38,889 

116,261 

17,695
402,327
64,215
43,105

527,342

1,343,951 

1,619,658

1,749,891 

1,631,939

1,058,578 
(71,704) 
515,242 

1,502,116 
246,932 
843 

812,844
(13,006)
584,348

1,384,186
246,932
821

1,749,891 

1,631,939

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

42

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
statement of cash flows 
for the year ended 31 July 2010 

Consolidated

2010 
$000 

2009
$000

Note 

Cash flows from operating activities 
Cash receipts from customers 
Cash paid to suppliers and employees 

Cash generated from operations 
Interest received 
Dividends received 
Interest paid 
Income tax paid 

Net cash from operating activities 

38 

Cash flows from investing activities 
Proceeds from sale of property, plant and equipment 
Proceeds from sale of businesses and investments 
Payments for plant and equipment 
Payment for investments 
Purchase of businesses, net of cash acquired 
Payments for acquired intangibles and major product  
development expenditure 

Net investing cash flows 

Cash flows from financing activities 
Shares issue proceeds (net of costs) 
Shares issue proceeds under share purchase plan 
Proceeds from borrowings 
Repayment of borrowings 
Repayment of receivables securitisation program 
Distribution to Nufarm Step-up Security holders 
Dividends paid 

Net financing cash flows 

Net increase (decrease) in cash and cash equivalents 
Cash at the beginning of the year 
Exchange	rate	fluctuations	on	foreign	cash	balances	

Cash and cash equivalents at 31 July 

15 

The	statement	of	cash	flows	is	to	be	read	in	conjunction	with	the	attached	notes.	

2,160,601 
(1,894,590) 

2,874,917
(2,799,092)

266,011 
6,014 
292 
(62,790) 
(14,916) 

194,611 

1,498 
5,014 
(45,918) 
– 
(43,628) 

75,825
8,177
423
(100,252)
(37,298)

(53,125)

284
12,821
(54,317)
(8,321)
(14,454)

(45,486) 

(48,257)

(128,520) 

(112,244)

245,881 
– 
48,784 
(201,930) 
– 
(14,469) 
(34,025) 

44,241 

110,332 
48,643 
1,730	

160,705 

294,764
35,691
56,022
(43,799)
(94,728)
(21,908)
(53,208)

172,834

7,465
38,302
2,876

48,643

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

43

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
	
 
 
statement of changes in equity 
for the year ended 31 July 2010 

Consolidated 

Share 
capital 
$000 

Translation 
reserve 
$000 

Capital profit 
reserve 
$000 

Other 

reserve 

$000 

Retained 

earnings 

$000 

Nufarm Step-up 

Securities 

$000 

Total 

$000 

Non-controlling 

interest 

$000 

Total

equity

$000

Balance at 1 August 2008  

453,824 

(26,805) 

33,627 

3,046 

593,558 

246,932 

1,304,182 

1,036 

1,305,218 

Foreign exchange translation differences  
Actuarial gains/(losses) on defined benefit plans 
Shares issued to employees  
Accrual and issue of shares under global share plan  

Shares issued under private placement (net of costs)  
Shares issued under share purchase plan  
Shares issued as consideration for business acquisition  
Dividend reinvestment plan  
Tax benefit on share issue costs  

Profit for the period  

Dividends paid to shareholders  
Distributions to Nufarm Step-up Security holders  
Non-controlling interest acquired 

– 
 – 
3,078 
784 

294,764 
35,691 
7,975 
12,705 
1,683 

– 

– 
– 
– 

(19,828) 
– 
– 
– 

– 
– 
– 
– 
– 

– 

– 
– 
– 

– 
– 
– 
– 

– 
– 
– 
– 
– 

– 

– 
– 
– 

Balance at 31 July 2009  

810,504 

(46,633) 

33,627 

2,340 

584,348 

246,932 

1,631,118 

821 

1,631,939 

Balance at 1 August 2009  

810,504 

(46,633) 

33,627 

2,340 

584,348 

246,932 

1,631,118 

821 

1,631,939 

Foreign exchange translation differences  
Actuarial gains/(losses) on defined benefit plans  
Shares issued to employees  
Accrual and issue of shares under global share plan  

Shares issued under institutional offer (net of costs)  
Shares issued under retail offer (net of costs)  
Tax benefit on share issue costs  

Profit/(loss) for the period  

Dividends paid to shareholders  
Distributions to Nufarm Step-up Security holders  

– 
– 
699 
– 

140,951 
104,930 
777 

– 

– 
– 

(58,698) 
– 
– 
– 

– 
– 
– 

– 

– 
– 

– 
– 
– 
– 

– 
– 
– 

– 

– 
– 

Balance at 31 July 2010  

1,057,861 

(105,331) 

33,627 

717 

515,242 

246,932 

1,749,048 

843 

1,749,891 

(8,454) 

(706) 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

(1,623) 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

79,877 

(65,297) 

(15,336) 

– 

(2,280) 

(23,990) 

(32,709) 

(10,127) 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

(19,828) 

(8,454) 

3,078 

78 

294,764 

35,691 

7,975 

12,705 

1,683 

79,877 

(65,297) 

(15,336) 

– 

(58,698) 

(2,280) 

699 

(1,623) 

140,951 

104,930 

777 

(23,990) 

(32,709) 

(10,127) 

48 

79,925 

(303) 

40 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

(19,788)

(8,454)

3,078 

78 

294,764 

35,691 

7,975 

12,705 

1,683 

(65,297)

(15,336)

(303)

(58,698)

(2,280)

699 

(1,623)

140,951 

104,930 

777 

(32,709)

(10,127)

22 

(23,968)

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

44

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
statement of changes in equity continued
for the year ended 31 July 2010 

Consolidated 

Share 

capital 

$000 

Translation 

Capital profit 

reserve 

$000 

reserve 

$000 

Other 
reserve 
$000 

Retained 
earnings 
$000 

Nufarm Step-up 
Securities 
$000 

Total 
$000 

Non-controlling 
interest 
$000 

Total
equity
$000

Balance at 1 August 2008  

453,824 

(26,805) 

33,627 

3,046 

593,558 

246,932 

1,304,182 

1,036 

1,305,218 

– 
– 
– 
(706) 

– 
– 
– 
– 
– 

– 

– 
– 
– 

– 
(8,454) 
– 
– 

– 
– 
– 
– 
– 

79,877 

(65,297) 
(15,336) 
– 

– 
– 
– 
– 

– 
– 
– 
– 
– 

– 

– 
– 
– 

(19,828) 
(8,454) 
3,078 
78 

294,764 
35,691 
7,975 
12,705 
1,683 

79,877 

(65,297) 
(15,336) 
– 

40 
– 
– 
– 

– 
– 
– 
– 
– 

(19,788)
(8,454)
3,078 
78 

294,764 
35,691 
7,975 
12,705 
1,683 

48 

79,925 

– 
– 
(303) 

(65,297)
(15,336)
(303)

Balance at 31 July 2009  

810,504 

(46,633) 

33,627 

2,340 

584,348 

246,932 

1,631,118 

821 

1,631,939 

Balance at 1 August 2009  

810,504 

(46,633) 

33,627 

2,340 

584,348 

246,932 

1,631,118 

821 

1,631,939 

– 
– 
– 
(1,623) 

– 
– 
– 

– 

– 
– 

– 
(2,280) 
– 
– 

– 
– 
– 

(23,990) 

(32,709) 
(10,127) 

– 
– 
– 
– 

– 
– 
– 

– 

– 
– 

(58,698) 
(2,280) 
699 
(1,623) 

140,951 
104,930 
777 

(23,990) 

(32,709) 
(10,127) 

– 
– 
– 
– 

– 
– 
– 

(58,698)
(2,280)
699 
(1,623)

140,951 
104,930 
777 

22 

(23,968)

– 
– 

(32,709)
(10,127)

Balance at 31 July 2010  

1,057,861 

(105,331) 

33,627 

717 

515,242 

246,932 

1,749,048 

843 

1,749,891 

Foreign exchange translation differences  

Actuarial gains/(losses) on defined benefit plans 

Shares issued to employees  

Accrual and issue of shares under global share plan  

Shares issued under private placement (net of costs)  

Shares issued under share purchase plan  

Shares issued as consideration for business acquisition  

Dividend reinvestment plan  

Tax benefit on share issue costs  

Profit for the period  

Dividends paid to shareholders  

Distributions to Nufarm Step-up Security holders  

Non-controlling interest acquired 

Foreign exchange translation differences  

Actuarial gains/(losses) on defined benefit plans  

Shares issued to employees  

Accrual and issue of shares under global share plan  

Shares issued under institutional offer (net of costs)  

Shares issued under retail offer (net of costs)  

Tax benefit on share issue costs  

Profit/(loss) for the period  

Dividends paid to shareholders  

Distributions to Nufarm Step-up Security holders  

– 

 – 

3,078 

784 

294,764 

35,691 

7,975 

12,705 

1,683 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

699 

140,951 

104,930 

777 

(19,828) 

(58,698) 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

45

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements

1. Reporting entity

Nufarm Limited (the ‘company’) is domiciled in Australia. The address of the company’s registered office is 
103-105 Pipe Road, Laverton North, Victoria, 3026. The consolidated financial statements of the company as  
at and for the year ended 31 July 2010 comprise the company and its subsidiaries (together referred to as the 
‘group’ and individually as ‘group entities’) and the group’s interest in associates and jointly controlled entities. 
The group is primarily involved in the manufacture and sale of crop protection products used by farmers to 
protect crops from damage caused by weeds, pests and disease.

2. Basis of preparation

(a) Statement of compliance

The financial report is a general purpose financial report which has been prepared in accordance with Australian 
Accounting Standards (AASBs) (including Australian interpretations) adopted by the Australian Accounting 
Standards Board (AASB) and the Corporations Act 2001. The consolidated financial report of the group complies 
with International Financial Reporting Standards (AIFRS) and interpretations adopted by the International Accounting 
Standards Board (IASB).

The consolidated financial statements were authorised for issue by the board of directors on 28 September 2010.

(b) Basis of measurement

The consolidated financial statements have been prepared on the historical cost basis except for derivative 
financial instruments, which are measured at fair value. The methods used to measure fair values are discussed 
further in note 4.

The main bilateral bankers to the group are parties to a deed of negative pledge dated 24 October 1996 (the 
‘deed’) (last amendment 30 January 2009), which contains the covenants and other terms common to all 
bankers. These covenants include an interest cover covenant, a net debt to EBITDA covenant and a gearing 
covenant. At 31 July 2010, the group was not in compliance with the first two covenants.

Despite there being a breach of certain banking covenants that were applicable at 31 July 2010, the group  
has prepared its financial report on a going concern basis, which contemplates the realisation of assets and 
extinguishment of liabilities in the ordinary course of business, as the directors and management are confident 
that there will be sufficient funds available to meet the group’s financial obligations until new longer term banking 
arrangements are established.

As a consequence of these covenant breaches, the main bankers to the group had the right, but not the obligation, 
to request immediate repayment of all amounts borrowed under the deed which as at 31 July 2010 totalled  
$701 million. Accordingly, all borrowings have been classified as current in the balance sheet.

Subsequent to 31 July 2010, the group obtained written waivers from all parties to the deed in respect to these 
covenant breaches. At the same time, the parties to the deed confirmed that any undrawn facility amounts under 
the deed were no longer available to the group.

Subsequent to 31 July, the group has contractually obtained additional secured funding totalling $176 million for 
the period through to 15 December 2010. Of this amount, $55 million is immediately available, with the balance 
available on satisfaction of normal terms and conditions, and also the following:

•	 provision	by	the	group	of	a	strategic	plan	and	a	management	plan;	

•	 provision	of	a	financial	advisor’s	report	that	is	satisfactory	to	the	lenders;

•	 providing	security	to	the	lenders	within	an	acceptable	time	period;

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

46

 
 
 
 
 
 
 
notes to the financial statements continued

2. Basis of preparation (continued)

(b) Basis of measurement (continued)

•	 the	achievement	of	forecast	profitability	and	cash	flow	targets	will	be	subject	to	regular	review	by	the	financial	

advisor. Variances outside agreed levels have to be approved by a majority of lenders (by value); and 

•	 the	adherence	to	newly	established	covenant	levels.

The agreements provide the lenders with certain rights and impose certain obligations and restrictions on the 
group, with the exception of where a majority of lenders (by value) otherwise provide their consent. These 
obligations and restrictions include:

•	 restrictions	on	the	disposal	of	assets;	and

•	 progress	against	the	strategic	plan	and	the	management	plan	to	be	reported	in	writing.

The directors and management are confident that the group can comply with the above obligations and restrictions.

The agreements provide each individual lender with the ability to revoke its waiver and request immediate repayment 
of total indebtedness to that lender in certain circumstances, including in the event that adverse variances between 
actual	and	forecast	EBIT	and	cash	flows	exceed	specified	limits.	Based	on	current	forecasts,	the	directors	and	
management are confident that these limits will not be breached for the duration of the agreements.

The agreements provide a majority of lenders (by value) with the right to revoke their waivers and request 
immediate repayment of total indebtedness to that lender in certain circumstances, including: 

•	 if	certain	ratio	requirements	in	respect	of	interest	coverage	and	cash	flow	are	not	satisfied;	

•	 if	the	lenders	are	not	satisfied	with	the	strategic	plan	or	the	management	plan	prepared	by	the	group,	 

or are not satisfied with the progress in implementing the plans; and

•	 if	adverse	findings	are	reported	by	the	financial	advisor	as	part	of	the	conditions	precedent	to	drawing	down	

new loans.

Based on current forecasts, intended actioning of the plans referred to above and the anticipated findings of  
the lenders’ financial advisor, the directors and management are confident that such events are not expected  
to occur for the duration of the agreement.

The group is currently evaluating its options regarding the nature and term of a new financing facility beyond  
15 December 2010. This facility may take the form of a secured syndicated facility or a similar arrangement. 
Management and the directors are confident that new banking arrangements on mutually agreeable terms  
and conditions can be established prior to this date.

(c) Functional and presentation currency

These consolidated financial statements are presented in Australian dollars, which is the company’s functional 
currency. The company is of a kind referred to in ASIC Class Order 98/100 dated 10 July 1998 and in accordance 
with that Class Order, all financial information presented in Australian dollars has been rounded to the nearest 
thousand unless otherwise stated.

(d) Use of estimates and judgements

The preparation of financial statements in conformity with AASBs requires management to make judgements, 
estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, 
liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying 
assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the  
period in which the estimate is revised and in any future periods affected.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

47

 
 
 
 
 
notes to the financial statements continued

2. Basis of preparation (continued)

(d) Use of estimates and judgements (continued)

Information about significant areas of estimation uncertainty and critical judgements in applying accounting 
policies that have the most significant impact on the amount recognised in the financial statements are  
described below.

(i) Business combinations

Fair valuing assets and liabilities acquired in a business combination involves making assumptions about the 
timing	of	cash	inflows	and	outflows,	growth	assumptions,	discount	rates	and	cost	of	debt.	Refer	to	note	14	 
for details of acquisitions made during the period. 

(ii) Impairment testing

The group determines whether goodwill and intangibles with indefinite useful lives are impaired on an annual 
basis. This requires an estimation of the recoverable amount of the cash-generating units, using a value in use 
discounted	cash	flow	methodology.	The	estimation	of	future	cash	flows	requires	management	to	make	significant	
estimates and judgements concerning the identification of impairment indicators, earnings before interest and 
tax, growth rates, applicable discount rates and useful lives. Further details can be found in note 23 on intangibles.

(iii) Income taxes 

The group is subject to income taxes in Australia and overseas jurisdictions. There are many transactions and 
calculations undertaken during the ordinary course of business for which the ultimate tax determination is uncertain. 
Where the final tax outcome of these matters is different from the amounts initially recorded, such differences 
will impact the current and deferred tax provisions in the period in which the tax determination is made. Deferred 
tax assets are recognised only to the extent that it is probable that future taxable profits will be available against 
which the assets can be utilised. The assessment of probability involves estimation of a number of factors 
including future taxable income. 

(iv) Defined benefit plans 

A liability in respect of defined benefit pension plans is recognised in the balance sheet, and is measured as  
the present value of the defined benefit obligation at the reporting date less the fair value of the pension plan’s 
assets. The present value of the defined benefit obligation is based on expected future payments which arise 
from membership of the fund at the reporting date, calculated annually by independent actuaries. Consideration 
is given to expected future salary levels, experience of employee departures and periods of service. Refer note 
26 for details of the key assumptions used in determining the accounting for these plans. 

(v) Valuation of inventories 

Inventories of finished goods, raw materials and work in progress are valued at lower of cost and net realisable 
value. The net realisable value of inventories is the estimated market price at the time the product is expected  
to be sold. 

(vi) Valuation of receivables 

Nufarm and a major supplier are currently in dispute with respect to a claim that the supplier is liable for a 
relevant share of losses attributable to the sale of product during the 2009 and 2010 financial years. 

The parties entered into an agreement in 2002 that provides for the sharing of costs and proceeds associated 
with Nufarm’s sale of products. Nufarm’s claim, for approximately $52.7 million (2009: $39.9 million), is being 
contested by the supplier. This matter is currently subject to arbitration proceedings. Nufarm is confident it will 
recover all of this amount and will vigorously pursue its claim.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

48

 
 
 
 
 
 
notes to the financial statements continued

2. Basis of preparation (continued)

(e) Changes in accounting policies

Overview

Starting as of 1 August 2009, the group has changed its accounting policies in the following areas:

•	 accounting	for	business	combinations;

•	 accounting	for	acquisitions	of	non-controlling	interests;

•	 accounting	for	borrowing	costs;

•	 determination	and	presentation	of	operating	segments;	and

•	 presentation	of	financial	statements.

3. Significant accounting policies

The accounting policies set out below have been applied consistently to all periods presented in these consolidated 
financial statements, and have been applied consistently by group entities.

Certain comparative amounts have been reclassified to conform with the current year’s presentation. 

(a) Basis of consolidation 

(i) Business combinations

Change in accounting policy

The group has adopted revised AASB 3 Business Combinations (2008) and amended AASB 127 Consolidated and 
Separate Financial Statements (2008) for business combinations occurring in the financial year starting 1 August 
2009. All business combinations occurring on or after 1 August 2009 are accounted for by applying the acquisition 
method. The group has applied the acquisition method for the business combinations disclosed in note 14. The 
change in accounting policy is applied prospectively and had no material impact on earnings per share.

For every business combination, the group identifies the acquirer, which is the combining entity that obtains 
control of the other combining entities or businesses. Control is the power to govern the financial and operating 
policies of an entity so as to obtain benefits from its activities. In assessing control, the group takes into consideration 
potential voting rights that currently are exercisable. The acquisition date is the date on which control is transferred 
to the acquirer. Judgement is applied in determining the acquisition date and determining whether control is 
transferred from one party to another.

Measuring goodwill

The group measures goodwill as the fair value of the consideration transferred including the recognised amount 
of any non-controlling interest in the acquiree, less the net recognised amount (generally fair value) of the identifiable 
assets acquired and liabilities assumed, all measured as of the acquisition date.

Contingent liabilities

A contingent liability of the acquiree is assumed in a business combination only if such a liability represents a 
present obligation and arises from a past event, and its fair value can be measured reliably.

Non-controlling interest

The group measures any non-controlling interest at its proportionate interest in the identifiable net assets of the 
acquiree.

Transaction costs

Transaction costs that the group incurs in connection with a business combination, such as finder’s fees, legal 
fees, due diligence fees, and other professional and consulting fees, are expensed as incurred.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

49

 
 
 
 
 
notes to the financial statements continued

3. Significant accounting policies (continued)

(a) Basis of consolidation (continued)

(ii) Accounting for acquisitions of non-controlling interests

The group has adopted AASB 3 Business Combinations (2008) and AASB 127 Consolidated and Separate 
Financial Statements (2008) for acquisitions of non-controlling interests occurring in the financial year starting  
1 August 2009. Under the new accounting policy, acquisitions of non-controlling interests are accounted for as 
transactions with equity holders in their capacity as equity holders and therefore no goodwill is recognised as a 
result of such transactions. Previously, goodwill was recognised on the acquisition of a non-controlling interest in  
a subsidiary, and that represented the excess of the cost of the additional investment over the carrying amount  
of the interest in the net assets acquired at the date of exchange. The change in accounting policy was applied 
prospectively and had no impact on earnings per share.

(iii) Subsidiaries

Subsidiaries are entities controlled by the group. The financial statements of subsidiaries are included in the 
consolidated financial statements from the date that control commences until the date that control ceases. The 
accounting policies of subsidiaries have been changed where necessary to align them with the policies adopted  
by the group.

(iv) Investments in associates and jointly controlled entities (equity accounted investees)

Associates	are	those	entities	in	which	the	group	has	significant	influence,	but	not	control,	over	the	financial	and	
operating	policies.	Significant	influence	is	presumed	to	exist	when	the	group	holds	between	20	and	50	per	cent	 
of the voting power of another entity. Jointly controlled entities are those entities over whose activities the group 
has joint control, established by contractual agreement and requiring unanimous consent for strategic financial 
and operating decisions.

Investments in associates and jointly controlled entities are accounted for using the equity method (equity 
accounted investments) and are initially recognised at cost. The group’s investment includes goodwill identified 
on acquisition, net of any accumulated impairment losses. The consolidated financial statements include the 
group’s share of the income and expenses and equity movements of equity accounted investees, after adjustments 
to	align	the	accounting	policies	with	those	of	the	group,	from	the	date	that	significant	influence	or	joint	control	
commences	until	the	date	that	significant	influence	or	joint	control	ceases.	When	the	group’s	share	of	losses	
exceeds its interest in an equity accounted investment, the carrying amount of that interest, including any long 
term investments, is reduced to nil, and the recognition of further losses is discontinued except to the extent  
that the group has an obligation or has made payments on behalf of the investee.

(v) Transactions eliminated on consolidation

Intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions, 
are eliminated in preparing the consolidated financial statements. Unrealised gains arising from transactions with 
equity accounted investees are eliminated against the investment to the extent of the group’s interest in the investee. 
Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no 
evidence of impairment. 

Gains and losses are recognised when the contributed assets are consumed or sold by the equity accounted 
investee or, if not consumed or sold by the equity accounted investee, when the group’s interest in such entities 
is disposed of.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

50

 
 
 
 
 
notes to the financial statements continued

3. Significant accounting policies (continued)

(b) Foreign currency

(i) Foreign currency transactions

Transactions in foreign currencies are translated to the respective functional currencies of group entities at exchange 
rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the 
reporting date are retranslated to the functional currency at the foreign exchange rate at that date. Non-monetary 
assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated to the functional 
currency at the exchange rate at the date that the fair value was determined. Foreign currency differences arising 
on retranslation are recognised in profit or loss. Non-monetary items that are measured in terms of historical cost 
in a foreign currency are translated using the exchange rate at the date of the transaction. Foreign currency gains 
and losses are included in cost of sales as they mostly relate to the purchase of raw materials from overseas  
suppliers.

(ii) Foreign operations

The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, 
are translated to Australian dollars at exchange rates at the reporting date. The income and expenses of foreign 
operations are translated to Australian dollars at exchange rates at the dates of the transactions.

Foreign currency differences are recognised in other comprehensive income. Since 1 August 2004, the group’s 
date of transition to AIFRS, such differences have been recognised in the foreign currency translation reserve 
(FCTR). When a foreign operation is disposed of, in part or in full, the relevant amount in the FCTR is transferred 
to profit or loss as part of the profit or loss on disposal.

When the settlement of a monetary item receivable or payable to a foreign operation is neither planned or likely 
in the foreseeable future, foreign exchange gains and losses arising from such a monetary item are considered to 
form part of a net investment in a foreign operation and are recognised in other comprehensive income, and are 
presented within equity in the FCTR.

(c) Financial instruments

(i) Non-derivative financial assets

The group initially recognises loans and receivables and deposits on the date that they are originated. All other 
financial assets (including assets designated at fair value through profit or loss) are recognised initially on the 
trade date at which the group becomes a party to the contractual provisions of the instrument.

The	group	derecognises	a	financial	asset	when	the	contractual	rights	to	the	cash	flows	from	the	asset	expire,	or	
it	transfers	the	rights	to	receive	the	contractual	cash	flows	on	the	financial	asset	in	a	transaction	in	which	substantially	
all the risk and rewards of ownership of the financial asset are transferred. Any interest in transferred financial 
assets that is created or retained by the group is recognised as a separate asset or liability.

Financial assets and liabilities are offset and the net amount presented in the balance sheet when, and only 
when, the group has the legal right to offset the amounts and intends to settle on a net basis or to realise the 
asset and settle the liability simultaneously.

The group has the following non-derivative financial assets: financial assets at fair value through profit or loss, 
loans and receivables and available-for-sale financial assets.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

51

 
 
 
 
 
 
 
 
 
notes to the financial statements continued

3. Significant accounting policies (continued)

(c) Financial instruments (continued)

(i) Non-derivative financial assets (continued)

Financial assets at fair value through profit or loss

A financial asset is classified as at fair value through profit or loss if it is classified as held for trading or is designated 
as such upon initial recognition. Financial assets are designated at fair value through profit or loss if the group 
manages such investments and makes purchases and sale decisions based on their fair value in accordance with 
the group’s documented risk management or investment strategy. Upon initial recognition attributable transaction 
costs are recognised in profit and loss when incurred. Financial assets at fair value through profit or loss are 
measured at fair value, and changes therein are recognised in profit or loss.

Loans and receivables

Loans and receivables are financial assets with fixed or determinable payments that are not quoted in an active 
market. Such assets are recognised initially at fair value plus any direct attributable transaction costs. Subsequent 
to initial recognition loans and receivables are measured at amortised cost using the effective interest method, 
less any impairment losses. Loans and receivables comprise trade and other receivables.

Cash and cash equivalents comprise cash balances and call deposits with original maturities of three months or 
less. Bank overdrafts that are repayable on demand and form an integral part of the group’s cash management 
are	included	as	a	component	of	cash	and	cash	equivalents	for	the	purposes	of	the	statement	of	cash	flows.

(ii) Non-derivative financial liabilities

The group initially recognises debt securities and subordinated liabilities on the date they are originated. All  
other financial liabilities (including liabilities designated at fair value through profit or loss) are recognised initially 
on the trade date at which the group becomes a party to the contractual provisions of the instrument. The group 
derecognises a financial liability when its contractual obligations are discharged or cancelled or expire. Financial 
assets and liabilities are offset and the net amount presented in the balance sheet when, and only when, the 
group has the legal right to offset the amounts and intends to settle on a net basis or to realise the asset and 
settle the liability simultaneously.

The group has the following non-derivative financial liabilities: loans and borrowings, bank overdrafts and trade 
and other payables. Such financial liabilities are recognised initially at fair value plus any directly attributable 
transaction costs. Subsequent to initial recognition these financial liabilities are measured at amortised cost  
using the effective interest method.

(iii) Share capital

Ordinary shares

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares are 
recognised as a deduction from equity, net of any related income tax benefit. Dividends on ordinary shares are 
recognised as a liability in the period in which they are declared.

Hybrid securities

The group has on issue a hybrid security called Nufarm Step-up Securities (NSS). The NSS are classified as equity 
instruments and after-tax distributions thereon are recognised as distributions within equity.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

52

 
 
 
 
 
 
 
notes to the financial statements continued

3. Significant accounting policies (continued)

(c) Financial instruments (continued)

(iv) Derivative financial instruments, including hedge accounting

The group holds derivative financial instruments to manage its foreign currency and interest rate risk exposures.

Derivatives are recognised initially at fair value, with attributable transaction costs recognised in profit or loss as 
incurred. Subsequent to initial recognition, derivatives continue to be measured at fair value, with changes 
therein accounted for in profit or loss.

Cash flow hedges

The	group	has	not	entered	into	any	cash	flow	hedging	transactions	in	the	current	or	comparative	periods.

(d) Property, plant and equipment

(i) Recognition and measurement

Items of property, plant and equipment are measured at cost less accumulated depreciation and impairment 
losses.

Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed 
assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the asset 
to a working condition for its intended use, and the costs of dismantling and removing the items and restoring 
the site on which they are located, and capitalised borrowing costs (see below). Purchased software that is 
integral to the functionality of the related equipment is capitalised as part of that equipment.

When parts of an item of property, plant and equipment have different useful lives, they are accounted for as 
separate items (major components) of property, plant and equipment.

Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the 
proceeds from disposal with the carrying amount of property, plant and equipment and are recognised net in 
general and administrative expenses.

Change in accounting policy

In respect of borrowing costs relating to qualifying assets for which the commencement date for capitalisation is 
on or after 1 August 2009, the group capitalises borrowing costs directly attributable to the acquisition, construction 
or production of a qualifying asset as part of the cost of that asset. Previously the group immediately recognised all 
borrowing costs as an expense. This change in accounting policy was due to the adoption of AASB 123 Borrowing 
Costs (2007) and in accordance with the transitional provisions of that standard, comparative figures have not 
been restated. The change in accounting policy had no material impact on earnings per share.

(ii) Subsequent costs

The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the 
item	if	it	is	probable	that	the	future	economic	benefits	embodied	within	the	part	will	flow	to	the	group	and	its	
cost can be measured reliably. The carrying amount of the replaced part is derecognised. The costs of day-to-day 
servicing of property, plant and equipment are recognised in profit or loss as incurred.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

53

 
 
 
 
 
notes to the financial statements continued

3. Significant accounting policies (continued)

(d) Property, plant and equipment (continued)

(iii) Depreciation

Depreciation is calculated over the depreciable amount, which is the cost of an asset, less its residual value. 
Depreciation is recognised in profit or loss on a straight-line basis over the estimated useful lives of each part of  
an	item	of	property,	plant	and	equipment,	since	this	most	closely	reflects	the	expected	pattern	of	consumption	of	
the future economic benefits embodied in the asset. Leased assets are depreciated over the shorter of the lease 
term and their useful lives, unless it is reasonably certain that the group will obtain ownership by the end of the 
lease term. Land is not depreciated. 

The estimated useful lives for the current and comparative periods are as follows:

•	 buildings	

15–50	years

•	 leasehold	improvements	

5	years

•	 plant	and	equipment	

10–15	years

•	 motor	vehicles	

•	 computer	equipment	

5	years

3	years

Depreciation methods, useful lives and residual values are reassessed at each reporting date.

(e) Intangible assets

(i) Goodwill

Change in accounting policy

As from 1 August 2009, the group has adopted the revised AASB 3 Business Combinations (2008) and the amended 
AASB 127 Consolidated and Separate Financial Statements (2008). Revised AASB 3 and amended AASB 127 have 
been applied prospectively to business combinations with an acquisition date on or after 1 August 2009. 

The change in accounting policy had no material impact on earnings per share. For details on the initial recognition 
and measurement of goodwill related to business combinations that occurred during the financial year ended  
31 July 2010, see note 14.

Acquisitions of non-controlling interests

Acquisitions of non-controlling interests are accounted for as transactions with equity holders in their capacity as 
equity holders and therefore no goodwill is recognised as a result of such transactions.

Subsequent measurement

Goodwill is measured at cost less accumulated impairment losses. In respect of equity accounted investees, the 
carrying amount of goodwill is included in the carrying amount of the investment, and an impairment loss on such 
an investment is not allocated to any asset, including goodwill, that forms part of the carrying amount of the 
equity accounted investee.

(ii) Research and development

Expenditure on research activities, undertaken with the prospect of gaining new scientific or technical knowledge 
and understanding, is recognised in profit or loss when incurred.

Development activities involve a plan or design for the production of new or substantially improved products  
and processes. Development expenditure is capitalised only if development costs can be measured reliably, the 
product or process is technically and commercially feasible, future economic benefits are probable and the group 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

54

 
 
 
 
 
notes to the financial statements continued

3. Significant accounting policies (continued)

(e) Intangible assets (continued)

(ii) Research and development (continued)

has sufficient resources to complete development and to use or sell the asset. The expenditure capitalised 
includes the cost of materials, direct labour and overhead costs that are directly attributable to preparing the 
asset for its intended use and capitalised borrowing costs. Development expenditure that does not meet the 
above criteria is recognised in profit or loss as incurred. 

Capitalised development expenditure is measured at cost less accumulated amortisation and accumulated  
impairment losses.

(iii) Intellectual property

Intellectual property consists of product registrations, product access rights, trademarks, task force seats, 
product distribution rights and product licences acquired from third parties. Generally, product registrations, 
product access rights, trademarks and task force seats, if purchased outright, are considered to have an indefinite 
life. Other items of acquired intellectual property are considered to have a finite life in accordance with the terms 
of the acquisition agreement. Intellectual property intangibles acquired by the group are measured at cost less 
accumulated amortisation and impairment losses. Expenditure on internally generated goodwill and brands  
is expensed when incurred.

(iv) Other intangible assets

Other intangible assets that are acquired by the group, which have finite useful lives, are measured at cost less 
accumulated amortisation and accumulated impairment losses.

(v) Subsequent expenditure

Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the 
specific asset to which it relates. All other expenditure is recognised in profit or loss when incurred.

(vi) Amortisation

Amortisation is calculated over the cost of the asset, less its residual asset. For those intangibles with a finite life, 
amortisation is recognised in profit or loss on a straight-line basis over the estimated useful lives of the intangible 
assets	from	the	date	that	they	are	available	for	use,	since	this	most	closely	reflects	the	expected	pattern	of	
consumption of the future economic benefits embodied in the asset. The estimated useful life for intangible 
assets with a finite life, in the current and comparative periods, are as follows:

•	 capitalised	development	costs	

5	years

•	 intellectual	property	–	finite	life	

over	the	useful	life	in	accordance	with	the	acquisition	agreement	terms

•	 computer	software	

3	to	7	years

Amortisation methods, useful lives and residual values are reassessed at each reporting date.

(f) Leased assets

Leases in terms of which the group assumes substantially all of the risks and rewards of ownership are classified 
as finance leases. Upon initial recognition, the leased asset is measured at an amount equal to the lower of its 
fair value and the present value of the minimum lease payments. Subsequent to initial recognition, the asset is 
accounted for in accordance with the accounting policy applicable to that asset. 

Other leases are operating leases and the leased assets are not recognised in the group’s balance sheet.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

55

 
 
 
 
 
 
 
notes to the financial statements continued

3. Significant accounting policies (continued)

(g) Inventories

Inventories are measured at the lower of cost and net realisable value. The cost of inventories is based on the 
first-in first-out principle and includes expenditure incurred in acquiring the inventories, production or conversion 
costs and other costs incurred in bringing them to their existing location and condition. In the case of manufactured 
inventories and work in progress, cost includes an appropriate share of overheads based on normal operating 
capacity. 

Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs  
of completion and selling expenses.

(h) Impairment

(i) Financial assets

A financial asset, not carried at fair value through profit or loss, is assessed at each reporting date to determine 
whether there is any objective evidence that it is impaired. A financial asset is impaired if objective evidence 
indicates that a loss event has occurred after the initial recognition of the asset, and that the loss event had  
a	negative	effect	on	the	estimated	future	cash	flows	of	that	asset	that	can	be	estimated	reliably.

An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference 
between	its	carrying	amount,	and	the	present	value	of	estimated	future	cash	flows	discounted	at	the	original	
effective interest rate.

(ii) Non-financial assets

The carrying amounts of the group’s non-financial assets, other than inventories and deferred tax assets, are 
reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication 
exists, then the asset’s recoverable amount is estimated. For goodwill and intangible assets that have indefinite 
lives or that are not yet available for use, the recoverable amount is estimated each year at reporting date.

The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less 
costs	to	sell.	In	assessing	value	in	use,	the	estimated	future	cash	flows	are	discounted	to	their	present	value	using	
a	pre-tax	discount	rate	that	reflects	current	market	assessments	of	the	time	value	of	money	and	the	risks	specific	
to the asset. For the purpose of impairment testing, assets are grouped together into the smallest group of assets 
that	generates	cash	flows	from	continuing	use	that	are	largely	independent	of	the	cash	inflows	of	other	assets	 
or groups of assets (the ‘cash-generating unit’). The goodwill acquired in a business combination, for the purpose 
of impairment testing, is allocated to cash-generating units that are expected to benefit from the synergies  
of the combination.

An impairment loss is recognised if the carrying amount of an asset or its cash-generating unit exceeds its 
estimated recoverable amount. Impairment losses are recognised in profit or loss. Impairment losses recognised  
in respect of cash-generating units are allocated first to reduce the carrying amount of any goodwill allocated  
to the units and then to reduce the carrying amount of other assets in the unit on a pro rata basis.

An impairment loss in respect of goodwill is not reversed. In respect of other assets, impairment losses recognised 
in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer 
exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable 
amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the 
carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss  
had been recognised.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

56

 
 
 
 
 
notes to the financial statements continued

3. Significant accounting policies (continued)

(h) Impairment (continued)

(ii) Non-financial assets (continued)

Goodwill that forms part of the carrying amount of an investment in an associate is not recognised separately, 
and therefore is not tested for impairment separately. Instead, the entire amount of the investment in an associate 
is tested for impairment as a single asset when there is objective evidence that the investment in an associate 
may be impaired.

(i) Non-current assets held for sale

Non-current assets, or disposal groups comprising assets and liabilities, that are expected to be recovered primarily 
through sale rather than continuing use are classified as held for sale. Immediately before classification as held 
for sale, the assets, or components of a disposal group, are remeasured in accordance with the group’s accounting 
policies. Thereafter generally the assets, or disposal group, are measured at the lower of their carrying amount 
and fair value less cost to sell. Any impairment loss on a disposal group is allocated first to goodwill, and then  
to the remaining assets and liabilities on a pro rata basis, except that no loss is allocated to inventories, financial 
assets, deferred tax assets and employee benefit assets, which continue to be measured in accordance with  
the group’s accounting policies. Impairment losses on initial classification as held for sale and subsequent gains 
or losses on remeasurement are recognised in profit or loss. Gains are not recognised in excess of any cumulative 
impairment loss.

(j) Employee benefits

(i) Defined contribution plans

A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into 
a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions 
to defined contribution plans are recognised as an employee benefit expense in profit or loss in the periods during 
which services are rendered by employees. Prepaid contributions are recognised as an asset to the extent that a 
cash refund or a reduction in future payments is available.

(ii) Defined benefit plans

A defined benefit plan is a post-employment benefit plan other than a defined contribution plan. The group’s net 
obligation in respect of defined benefit plans is calculated separately for each plan by estimating the amount of 
future benefit that employees have earned in return for their service in the current and prior periods; that benefit 
is discounted to determine its present value. Any unrecognised past service costs and the fair value of any plan 
assets are deducted. The discount rate is the yield at the reporting date on government bonds that have maturity 
dates approximating the terms of the group’s obligations and that are denominated in the same currency in which 
the benefits are expected to be paid. The calculation is performed annually by a qualified actuary using the projected 
unit credit method. When the calculation results in a benefit to the group, the recognised asset is limited to the 
net total of any unrecognised past service costs and the present value of any future refunds from the plan or 
reductions in future contributions to the plan. In order to calculate the present value of economic benefits, 
consideration is given to any minimum funding requirements that may apply to any plan in the group. An economic 
benefit is available to the group if it is realisable during the life of the plan, or on settlement of the plan liabilities.

When the benefits of a fund are improved, the portion of the increased benefit relating to past service by employees 
is recognised in profit or loss on a straight-line basis over the average period until the benefits become vested.  
To the extent that the benefits vest immediately, the expense is recognised immediately in profit or loss.

The group recognises all actuarial gains and losses arising from the defined benefit plans directly in other  
comprehensive income.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

57

 
 
 
 
 
notes to the financial statements continued

3. Significant accounting policies (continued)

(j) Employee benefits (continued)

(iii) Other long term employee benefits

The group’s net obligation in respect of long term employee benefits, other than defined benefit plans, is the 
amount of future benefit that employees have earned in return for their service in the current and prior periods 
plus related on-costs; that benefit is discounted to determine its present value, and the fair value of any related 
assets is deducted. The discount rate is the yield at the reporting date on government bonds that have maturity 
dates approximating the terms of the group’s obligations. The calculation is performed using the projected unit 
credit method. Any actuarial gains or losses are recognised in profit or loss in the period in which they arise.

(iv) Termination benefits

Termination benefits are recognised as an expense when the group is demonstrably committed, without a realistic 
possibility of withdrawal, to a formal detailed plan to either terminate employment before the normal retirement 
date, or to provide termination benefits as a result of an offer made to encourage voluntary redundancy. Termination 
benefits for voluntary redundancies are recognised as an expense if the group has made an offer encouraging 
voluntary redundancy, it is probable that the offer will be accepted and the number of acceptances can be 
estimated reliably. If benefits are payable more than twelve months after the reporting period, then they  
are discounted to their present value.

(v) Short term benefits

Short term employee benefit obligations are measured on an undiscounted basis and are expensed as the related 
service is provided.

A liability is recognised for the amount expected to be paid under short term cash bonus or profit-sharing plans  
if the group has a present legal or constructive obligation to pay this amount as a result of past service provided 
by the employee and the obligation can be estimated reliably.

(vi) Share-based payment transactions

The group has a global share plan for employees whereby matching and loyalty shares are granted to employees.  
The fair value of matching and loyalty shares granted is recognised as expense in the profit or loss over the 
respective service period, with a corresponding increase in equity, rather than as the matching and loyalty  
shares are issued. Refer note 27 for details of the global share plan.

(k) Provisions

A provision is recognised if, as a result of a past event, the group has a present legal or constructive obligation 
that	can	be	estimated	reliably,	and	it	is	probable	that	an	outflow	of	economic	benefits	will	be	required	to	settle	
the	obligation.	Provisions	are	determined	by	discounting	the	expected	future	cash	flows	at	a	pre-tax	rate	that	
reflects	current	market	assessments	of	the	time	value	of	money	and	the	risks	specific	to	the	liability.	The	unwinding	
of the discount is recognised as finance cost.

A provision for restructuring is recognised when the group has approved a detailed and formal restructuring plan, 
and the restructuring either has commenced or has been announced publicly. Future operating losses are not 
provided for.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

58

 
 
 
 
 
notes to the financial statements continued

3. Significant accounting policies (continued)

(l) Revenue

Goods sold

Revenue from the sale of goods is measured at the fair value of the consideration received or receivable, net  
of returns, trade discounts and volume rebates. Revenue is recognised when persuasive evidence exists, usually in 
the form of an executed sales agreement, that the significant risks and rewards of ownership have been transferred 
to the buyer, recovery of the consideration is probable, the associated costs and possible return of goods can be 
estimated reliably, there is no continuing management involvement with the goods and the amount of revenue 
can be measured reliably. If it is probable that discounts will be granted and the amount can be measured reliably, 
then the discount is recognised as a reduction of revenue as the sales are recognised.

(m) Lease payments

Payments made under operating leases are recognised in profit or loss on a straight-line basis over the term of 
the lease. Lease incentives received are recognised as an integral part of the total lease expense, over the term 
of the lease.

Minimum lease payments made under finance leases are apportioned between the finance expense and  
the reduction of the outstanding liability. The finance expense is allocated to each period during the lease term  
so as to produce a constant periodic rate of interest on the remaining balance of the liability. Contingent lease 
payments are accounted for by revising the minimum lease payments over the remaining term of the lease  
when the lease adjustment is confirmed. 

Determining whether an arrangement contains a lease

At the inception of an arrangement, the group determines whether such an arrangement is or contains a lease.  
A specific asset is the subject of a lease if fulfilment of the arrangement is dependent on the use of that specified 
asset. An arrangement conveys the right to use the asset if the arrangement conveys to the group the right  
to control the use of the underlying asset. At inception or upon reassessment of the arrangement, the group 
separates payments and other considerations required by such an arrangement into those for the lease and those  
for other elements on the basis of their relative fair values. If the group concludes for a finance lease that it is 
impracticable to separate the payments reliably, an asset and liability are recognised at an amount equal to the 
fair value of the underlying asset. Subsequently the liability is reduced as payments are made and an imputed 
finance charge on the liability is recognised using the group’s incremental borrowing rate.

(n) Finance income and expense

Finance income comprises interest income on funds invested, dividend income, changes in the fair value of financial 
assets at fair value through profit or loss, and gains on hedging instruments that are recognised in profit or loss. 
Interest income is recognised as it accrues in profit or loss, using the effective interest method. Dividend income 
is recognised in profit or loss on the date that the group’s right to receive payment is established.

Finance expense comprises interest expense on borrowings, unwinding of the discount on provisions, changes 
in the fair value of financial assets classified as ‘fair value through profit or loss’, dividends on preference shares 
classified as liabilities, impairment losses recognised on financial assets and losses on hedging instruments that 
are recognised in profit or loss. Borrowing costs that are not directly attributable to the acquisition, construction 
or production of a qualifying asset are recognised in profit or loss using the effective interest rate method.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

59

 
 
 
 
 
notes to the financial statements continued

3. Significant accounting policies (continued)

(o) Income tax

Income tax expense comprises current and deferred tax. Current and deferred taxes are recognised in profit  
or loss except to the extent that it relates to a business combination, or items recognised directly in equity  
or in other comprehensive income.

Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates 
enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous 
years.

Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities 
for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for 
the following temporary differences: the initial recognition of assets or liabilities in a transaction that is not a 
business combination and that affects neither accounting nor taxable profit or loss, and differences relating to 
investments in subsidiaries and jointly controlled entities to the extent that they will probably not reverse in the 
foreseeable future. In addition, deferred tax is not recognised for taxable temporary differences arising on the 
initial recognition of goodwill. Deferred tax is measured at the tax rates that are expected to be applied to the 
temporary differences when they reverse, based on the laws that have been enacted or substantively enacted  
by the reporting date. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset 
current tax liabilities and assets, and they relate to income taxes levied by the same tax authority on the same 
taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis 
or their tax assets and liabilities will be realised simultaneously.

A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences, to the 
extent that it is probable that future taxable profits will be available against which they can be utilised. The group 
will not recognise deferred tax assets related to tax losses where the estimated recovery period extends beyond 
eight years, even if there is no statutory time limit on the recoupment of these losses. The effect of this change 
is identified in note 6. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that 
it is no longer probable that the related tax benefit will be realised.

Additional income taxes that arise from the distribution of cash dividends are recognised at the same time as the 
liability to pay the related dividend is recognised. The group does not distribute non-cash assets as dividends to 
its shareholders.

(i) Tax consolidation

The company and its wholly-owned Australian resident entities are part of a tax-consolidated group. As a  
consequence, all members of the tax-consolidated group are taxed as a single entity. The head entity within  
the tax-consolidated group is Nufarm Limited.

Current tax expense/income, deferred tax liabilities and deferred tax assets arising from temporary differences of 
the members of the tax-consolidated group are recognised in the separate financial statements of the members 
of the tax-consolidated group using the ‘separate taxpayer within group’ approach by reference to the carrying 
amounts of assets and liabilities in the separate financial statements of each entity and the tax values applying 
under tax consolidation.

Any current tax liabilities (or assets) and deferred tax assets arising from unused tax losses of the subsidiaries are 
assumed by the head entity in the tax-consolidated group and are recognised by the company as amounts payable/ 
(receivable) to/(from) other entities in the tax-consolidated group in conjunction with any tax funding arrangement 
amounts (refer below). Any difference between these amounts is recognised by the company as an equity 
contribution or distribution.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

60

 
 
 
 
 
notes to the financial statements continued

3. Significant accounting policies (continued)

(o) Income tax (continued)

(i) Tax consolidation (continued)

The company recognises deferred tax assets arising from unused tax losses of the tax-consolidated group to the 
extent that it is probable that future taxable profits of the tax-consolidated group will be available against which 
the asset can be utilised.

Any subsequent period adjustments to deferred tax assets arising from unused tax losses as a result of revised 
assessments of the probability of recoverability is recognised by the head entity only.

(ii) Nature of tax funding arrangements and tax sharing agreements

The head entity, in conjunction with other members of the tax-consolidated group, has entered into a tax funding 
arrangement which sets out the funding obligations of members of the tax-consolidated group in respect of tax 
amounts. The tax funding arrangements require payments to/from the head entity equal to the current tax liability/ 
(asset) assumed by the head entity and any tax-loss deferred tax asset assumed by the head entity, resulting in 
the head entity recognising an inter-entity receivable/(payable) equal in amount to the tax liability/(asset) assumed. 
The inter-entity receivables/(payables) are at call.

Contributions	to	fund	the	current	tax	liabilities	are	payable	as	per	the	tax	funding	arrangement	and	reflect	the	
timing of the head entity’s obligation to make payments for tax liabilities to the relevant tax authorities.

The head entity, in conjunction with other members of the tax-consolidated group, has also entered a tax sharing 
agreement. The tax sharing agreement provides for the determination of the allocation of the income tax liabilities 
between the entities should the head entity default on its tax payment obligations. No amounts have been 
recognised in the financial statements in respect of this agreement as payment of any amounts under the  
tax sharing agreement is considered remote.

(p) Goods and services tax

Revenue, expenses and assets are recognised net of the amount of goods and services tax (GST or equivalent), 
except where the GST incurred is not recoverable from the taxation authority. In these circumstances, the GST  
is recognised as part of the cost of acquisition of the asset or as part of the expense.

Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from, 
or payable to, the ATO is included as a current asset or liability in the balance sheet.

Cash	flows	are	included	in	the	statement	of	cash	flows	on	a	gross	basis.	The	GST	components	of	cash	flows	arising	
from investing and financing activities which are recoverable from, or payable to, the relevant tax authorities are 
classified	as	operating	cash	flows.

(q) Discontinued operations

A discontinued operation is a component of the group’s business that represents a separate major line of 
business or geographical area of operations that has been disposed of or is held for sale, or is a subsidiary 
acquired exclusively with a view to resale. Classification as a discontinued operation occurs upon disposal or 
when the operation meets the criteria to be classified as held for sale, if earlier. When an operation is classified 
as a discontinued operation, the comparative income statement is re-presented as if the operation had been 
discontinued from the start of the comparative period.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

61

 
 
 
 
 
notes to the financial statements continued

3. Significant accounting policies (continued)

(r) Earnings per share

The group presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated 
by dividing the profit or loss attributable to ordinary shareholders of the company by the weighted average number 
of ordinary shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable 
to ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of all 
potential dilutive ordinary shares, which comprise convertible notes and share options granted to employees.

(s) Segment reporting

Determination and presentation of operating segments

As of 1 August 2009, the group determines and presents operating segments based on the information that internally 
is provided to the chief executive officer (CEO), who is the group’s chief operating decision maker. This change  
in accounting policy is due to the adoption of IFRS 8 Operating Segments. Previously, operating segments were 
determined and presented in accordance with AASB 114 Segment Reporting. The new accounting policy in 
respect of segment reporting disclosures is presented as follows.

Comparative segment information has been re-presented in conformity with the transitional requirements of such 
standard. Since the change in accounting policy only impacts presentation and disclosure aspects, there is no 
impact on earnings per share.

An operating segment is a component of the group that engages in business activities from which it may earn 
revenue and incur expenses, including revenues and expenses that relate to transactions with any of the group’s 
other components. All operating segments’ operating results are regularly reviewed by the group’s CEO to make 
decisions about resources to be allocated to the segment and assess its performance, and for which discrete 
financial information is available.

Segment results that are reported to the CEO include items directly attributable to a segment as well as those 
that can be allocated on a reasonable basis. Unallocated items comprise mainly loans and borrowings and related 
expenses, corporate assets and head office expenses, and income tax assets and liabilities.

Segment capital expenditure is the total cost incurred during the period to acquire property, plant and equipment 
and intangible assets other than goodwill.

(t) Presentation of financial statements

The group applies revised AASB 101 Presentation of Financial Statements (2007), which became effective for the 
financial year beginning after 1 January 2009. As a result, the group presents in the consolidated statement of 
changes in equity all owner changes in equity, whereas all non-owner changes in equity are presented in the 
consolidated statement of comprehensive income.

Comparative information has been re-presented so that it is also in conformity with the revised standard. Since 
the change in accounting policy only impacts presentation aspects, there is no impact on earnings per share.

(u) New standards and interpretations not yet adopted

The following standards, amendments to standards and interpretations have been identified as those which may 
impact the entity in the period of initial application. They are available for early adoption at 31 July 2010, but have 
not been applied in preparing this financial report:

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

62

 
 
 
 
 
notes to the financial statements continued

3. Significant accounting policies (continued)

(u) New standards and interpretations not yet adopted (continued)

•	 AASB	9	Financial Instruments includes requirements for the classification and measurement of financial assets 
resulting from the first part of Phase 1 of the project to replace AASB 139 Financial Instruments: Recognition and 
Measurement. AASB 9 will become mandatory for the group’s 31 July 2014 financial statements. Retrospective 
application is generally required, although there are exceptions, particularly if the entity adopts the standard for 
the year ended 31 July 2012 or earlier. The group has not yet determined the potential effect of the standard.

•	 AASB	124 Related Party Disclosures (revised December 2009) simplifies and clarifies the intended meaning  

of the definition of a related party and provides a partial exemption from the disclosure requirements for 
government-related entities. The amendments, which will become mandatory for the group’s 31 July 2012 
financial statements, are not expected to have any impact on the financial statements.

•	 AASB	2009-5	Further Amendments to Australian Accounting Standards arising from the Annual Improvements 
Process affect various AASBs resulting in minor changes for presentation, disclosure, recognition and measurement 
purposes. The amendments, which become mandatory for the group’s 31 July 2011 financial statements, are 
not expected to have a significant impact on the financial statements.

•	 AASB	2009-8	Amendments to Australian Accounting Standard – Group Cash-settled Share-based Payment 
Transactions resolves diversity in practice regarding the attribution of cash-settled share-based payments 
between different entities within a group. As a result of the amendments AI 8 Scope of AASB 2 and AI AASB 2 
– Group and Treasury Share Transactions will be withdrawn from the application date. The amendments, which 
become mandatory for the group’s 31 July 2011 financial statements, are not expected to have a significant 
impact on the financial statements.

•	 AASB	2009-10	Amendments to Australian Accounting Standard – Clarification of Rights Issue [AASB 132] 
(October 2010) clarify that rights, options or warrants to acquire a fixed number of an entity’s own equity 
instruments for a fixed amount in any currency are equity instruments if the entity offers the rights, options  
or warrants pro rata to all existing owners of the same class of its own non-derivative equity instruments.  
The amendments, which will become mandatory for the group’s 31 July 2011 financial statements, are not 
expected to have a significant impact on the financial statements.

•	 AASB	2009-14	Amendments to Australian Accounting Standard – Prepayments of a Minimum Funding Requirement 
– AASB 14 make amendments to Interpretation 14 AASB 119 – The Limit on a Defined Benefit Asset, Minimum 
Funding Requirements removing an unintended consequence arising from the treatment of the prepayments 
of future contributions in some circumstances when there is a minimum funding requirement. The amendments 
will become mandatory for the group’s 31 July 2012 financial statements, with retrospective application 
required. The amendments are not expected to have any impact on the financial statements.

•	 IFRIC	19	Extinguishing Financial Liabilities with Equity Instruments addresses the accounting by an entity when 
the terms of a financial liability are renegotiated and result in the entity issuing equity instruments to a creditor 
of the entity to extinguish all or part of the financial liability. IFRIC 19 will become mandatory for the group’s  
31 July 2011 financial statements. The group has not yet determined the potential effect of the amendment.

4. Determination of fair values

A number of the group’s accounting policies and disclosures require the determination of fair value, for both 
financial and non-financial assets and liabilities. Fair values have been determined for measurement and/or disclosure 
purposes based on the following methods. When applicable, further information about the assumptions made  
in determining fair values is disclosed in the notes specific to that asset or liability.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

63

 
 
 
 
 
notes to the financial statements continued

4. Determination of fair values (continued)

(i) Property, plant and equipment

The fair value of property, plant and equipment recognised as a result of a business combination is based on 
market values. The market value of property is the estimated amount for which a property could be exchanged 
on the date of valuation between a willing buyer and a willing seller in an arm’s length transaction after proper 
marketing wherein the parties had each acted knowledgeably, and willingly. The market value of items of plant, 
equipment, fixtures and fittings is based on the market approach and cost approaches quoted market prices  
for similar items when available and replacement cost when appropriate.

(ii) Intangibles assets

The fair value of patents and trademarks acquired in a business combination is based on the discounted estimated 
royalty payments that have been avoided as a result of the patent or trademark being owned. The fair value of 
other	intangible	assets	is	based	on	the	discounted	cash	flows	expected	to	be	derived	from	the	use	and	eventual	
sale of the assets.

(iii) Inventories

The fair value of inventories acquired in a business combination is determined based on its estimated selling 
price in the ordinary course of business less the estimated costs of completion and sale, and a reasonable profit 
margin based on effort required to complete and sell the inventories.

(iv) Trade and other receivables

The	fair	value	of	trade	and	other	receivables	is	estimated	as	the	present	value	of	future	cash	flows,	discounted	 
at the market rate of interest at the reporting date. This fair value is determined for disclosure purposes.

(v) Derivatives

The fair value of forward exchange contracts is based on their listed market price, if available. If a listed market 
price is not available, then fair value is estimated by discounting the difference between the contractual forward 
price and the current forward price for the residual maturity of the contract using a risk-free interest rate (based 
on government bonds).

The fair value of interest rate swaps is based on broker quotes. Those quotes are tested for reasonableness  
by	discounting	estimated	future	cash	flows	based	on	the	terms	and	maturity	of	each	contract	and	using	market	
interest rates for a similar instrument at the measurement date.

(vi) Non-derivative financial liabilities

Fair value, which is determined for disclosure purposes, is calculated based on the present value of future 
principal	and	interest	cash	flows,	discounted	at	the	market	rate	of	interest	at	the	reporting	date.	For	finance	
leases, the market rate of interest is determined by reference to similar lease agreements.

5. Operating segments 

Segment information is presented in respect of the group’s business and geographic segments. The primary 
format, geographic segments, is based on the group’s management and internal reporting structure. 

The group operates predominantly in one business segment, being the crop protection industry. The business  
is managed on a worldwide basis, with the major geographic segments for reporting being Australasia, Europe, 
North America and South America. The North America region includes Canada, US, Mexico and the Central 
American countries. The South America region includes Brazil, Argentina, Chile, Uruguay, Paraguay, Bolivia  
and the Andean countries. 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

64

 
 
 
 
 
 
 
notes to the financial statements continued

5. Operating segments (continued)

Information regarding the results of each reportable segment is included below. Performance is measured based 
on segment profit  as included in the internal management reports that are reviewed by the group’s CEO. Segment 
profit is used to measure performance as management believes that such information is the most relevant in 
evaluating the results of each segment. Segment revenue is based on the geographic location of customers. 
Segment results include items directly attributable to a segment as well as those that can be allocated on  
a reasonable basis. The corporate segment comprises mainly corporate expenses, interest-bearing loans,  
borrowings and corporate assets. 

Comparative segment information has been presented in conformity with the requirement of AASB 8 Operating 
Segments. 

Geographic segments 2010 

Revenue 
Total segment revenue 

Results 
Operating earnings 
Exchange gains/(losses) 
Share of net profit/(losses)  
of associates 

Australasia 
$000 

North 

South 
Europe  America  America  Corporate  Consolidated
$000
$000 

$000 

$000 

$000 

798,875  474,590 

553,653 

341,512 

– 

2,168,630 

92,248 
(4,516) 

54,422 
408 

34,468 
(1,244) 

(15,658) 
1,051 

(26,055) 
8 

139,425 
(4,293)

1,476 

(1,449) 

20 

– 

– 

47 

Segment result 

89,208 

53,381 

33,244 

(14,607) 

(26,047) 

135,179 

Material items of income/ 
(expense) (note 6) 
Net non-cash revaluation  
profit/(loss) on proceeds  
from Nufarm Step-up  
Securities financing (note 6) 

Segment result including  
material items 

Net financing costs 
Income tax benefit/(expense) 

Profit/(loss) for the period 

Assets 
Segment assets 
Investment in associates 

Total assets 

Liabilities 
Segment liabilities 

Total liabilities 

Other segment information 
Capital expenditure 
Depreciation 
Amortisation 

(11,446) 

(26,217) 

(30,970) 

(376) 

– 

(69,009)

– 

– 

– 

– 

3,323 

3,323 

77,762 

27,164 

2,274 

(14,983) 

(22,724) 

739,492  717,133 
180 

11,496 

483,768 
288 

687,515 
– 

453,970 
– 

69,493 

(56,776)
(35,369)

(22,652)

3,081,878 
11,964 

3,093,842 

155,381  156,270 

41,865 

99,501 

890,934 

1,343,951 

1,343,951 

16,238 
18,025 
4,415 

14,703 
15,232 
6,289 

32,047 
5,632 
2,878 

4,740 
3,204 
1,873 

– 
– 
– 

67,728 
42,093 
15,455

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

65

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

5. Operating segments (continued)

Geographic segments 2009 

Revenue 
Total segment revenue 

Results 
Operating earnings 
Exchange gains/(losses) 
Share of net profit/(losses)  
of associates 

Australasia 
$000 

North 

South 
Europe  America  America  Corporate  Consolidated
$000
$000 

$000 

$000 

$000 

850,211  636,928 

775,375 

414,569 

– 

2,677,083 

103,852  125,939 
(9,028) 

13,514 

109,664 
2,465 

(5,118) 
(35,009) 

(31,226) 
530 

303,111 
(27,528)

1,100 

1,934 

46 

– 

– 

3,080 

Segment result 

118,466  118,845 

112,175 

(40,127) 

(30,696) 

278,663 

Material items of income/  
(expense) (note 6) 
Net non-cash revaluation  
profit/(loss) on proceeds  
from Nufarm Step-up  
Securities financing 

Segment result including  
material items 

Net financing costs 
Income tax benefit/(expense) 

Profit/(loss) for the period 

Assets 
Segment assets 
Investment in associates 

Total assets 

Liabilities 
Segment liabilities 

Total liabilities 

Other segment information 
Capital expenditure 
Depreciation 
Amortisation 

– 

(18,259) 

(103,824) 

(753) 

(4,363) 

(127,199)

– 

– 

– 

– 

(431) 

(431)

118,466  100,586 

8,351 

(40,880) 

(35,490) 

151,033 

808,444  852,219 
1,812 

10,656 

580,115 
– 

653,988 
– 

344,363 
– 

(92,076)
21,585 

80,542 

3,239,129 
12,468 

3,251,597 

162,760  221,321 

55,593 

75,310  1,104,674 

1,619,658 

1,619,658 

32,408 
18,960 
5,360 

45,163 
21,177 
8,338 

21,570 
5,841 
2,558 

6,541 
2,434 
1,294 

– 
– 
– 

105,682 
48,412
17,550 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

66

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

6. Items of material income and expense 

The following material items of income/(expense)  
were included in the period result: 
Cost of sales items 
Net realisable value adjustment – year end inventories 
Net realisable value adjustment – product sold 
Restructuring costs 

General and administrative expense items 
Competition inquiries (AH Marks) 
Provision for non-collectability of sale proceeds 
Due diligence costs 
Restructuring costs and sale of equity investment 

Consolidated 

Consolidated

2010 
$000 
Pre-tax 

2010 
$000 
After-tax 

2009 
$000 
Pre-tax 

2009
$000 
After-tax

– 
(44,654) 
(15,323) 

– 
(30,074) 
(10,713) 

(67,611) 
(37,770) 
(16,421) 

(40,794)
(22,662)
(10,989)

(59,977) 

(40,787) 

(121,802) 

(74,445)

(569) 
(2,521) 
(5,464) 
(478) 

(9,032) 

(432) 
(1,690) 
(4,116) 
(321) 

(6,559) 

(10,567) 
(2,564) 
(1,859) 
9,593 

(10,182)
(1,709)
(1,364)
8,247 

(5,397) 

(5,008)

Material items included in operating result 

(69,009) 

(47,346) 

(127,199) 

(79,453)

Disclosed on face of income statement 
Net non-cash revaluation profit/(loss) on proceeds  
from Nufarm Step-up Securities financing 

Income tax expense 
Derecognition of tax losses 

3,323 

2,326 

(431) 

(302)

– 

(37,536) 

– 

– 

Items of material income and expense 

(65,686) 

(82,556) 

(127,630) 

(79,755)

7. Other income

Dividends received 
Rental income 
Sundry income 

Total other income 

Consolidated

2010 
$000 

52 
236 
8,353 

8,641 

2009
$000

–
383
10,671

11,054

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

67

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

8. Other expenses

The following expenses were included in the period result:

Depreciation and amortisation 
Impairment gain/(loss) on trade receivables1 
Movement in stock obsolescence provision 
Exchange gains/(losses) 

1 Excludes items set out in Note 6.

9. Personnel expenses

Wages and salaries 
Other associated personnel expenses 
Contributions to defined contribution superannuation funds 
Expenses related to defined benefit superannuation funds 
Annual leave expense 
Long-service leave expense 
Restructuring expense – Europe 

Personnel expenses 

The restructuring expense in Europe represents the redundancy costs  
associated with the shut down of the Belvedere UK site and two manufacturing  
units at the Gaillon plant in France. The restructuring costs are included in the  
material items in note 6.

10. Finance income and expense

Interest income – external 

Financial income 

Interest expense – external 
Lease expense – finance charges 
Costs of securitisation program 

Financial expenses 

Net financing costs 

Consolidated

2010 
$000 

2009
$000

(57,548) 
(375) 
(453) 
(4,293) 

(65,962)
(4,241)
(648)
(27,528)

(179,411) 
(31,146) 
(10,567) 
(3,106) 
(6,451) 
(1,690) 
(7,937) 

(203,969)
(37,214)
(10,847)
(457)
(6,319)
(1,886)
(23,403)

(240,308) 

(284,095)

6,014 

6,014 

(61,225) 
(1,565) 
– 

8,177

8,177

(98,796)
(1,887)
430

(62,790) 

(100,253)

(56,776) 

(92,076)

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

68

 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

11. Income tax expense/(benefit)

Recognised in the income statement
Current tax expense
Current period 
Adjustments for prior periods 

Current tax expense 

Deferred tax expense
Origination and reversal of temporary differences 
Reduction in tax rates 
Benefit of tax losses recognised 
Derecognition of tax losses 

Deferred tax expense 

Consolidated

2010 
$000 

2009
$000

(2,680) 
163 

(2,517) 

30,303 
124 
(30,077) 
37,536 

37,886 

6,161
(247)

5,914

(10,228)
2,604
(19,875)
–

(27,499)

Total income tax expense/(benefit) in income statement 

35,369 

(21,585)

Attributable to:
Continuing operations 

Total income tax expense/(benefit) in income statement 

Numerical reconciliation between tax expense/(benefit) and pre-tax net profit
Profit before tax – continuing operations 

Profit before tax 

Income tax using the local corporate tax rate of 30 per cent 
Increase in income tax expense due to:
Non-deductible expenses 
Other taxable income 
Effect of changes in the tax rate 
Effect of tax losses derecognised/(recognised) 
Decrease in income tax expense due to:
Effect on tax rate in foreign jurisdictions 
Tax exempt income 
Tax incentives not recognised in the income statement 

Under/(over) provided in prior years 

Income tax expense/(benefit) on pre-tax net profit 

Income tax recognised directly in equity
Relating to cost of issuing equity 
Nufarm Step-up Securities distribution 

Income tax recognised directly in equity 

Income tax recognised in other comprehensive income
Relating to actuarial gains on defined benefit plans 

Income tax recognised in other comprehensive income 

35,369 

35,369 

(21,585)

(21,585)

12,717 

12,717 

58,957

58,957

3,815 

17,687

3,222 
689 
124 
37,574 

(6,508) 
(347) 
(3,363) 

35,206 
163 

35,369 

(777) 
(3,795) 

(4,572) 

(835) 

(835) 

3,175
1,383
2,604
1,015

(38,850)
(1,225)
(7,127)

(21,338)
(247)

(21,585)

(1,683)
(6,572)

(8,255)

(3,363)

(3,363)

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

69

 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

12. Discontinued operation

There were no discontinued operations in the current or prior period.

13. Non-current assets held for sale

The Belvedere, UK manufacturing site has been shut down and is currently being prepared for sale. A sale 
agreement for the site has been executed with sales proceeds of £6.1 million. The site demolition has been 
completed, however, title cannot pass until remediation is complete and the necessary regulatory approvals  
are received. This is expected to occur before 31 December 2010. The following assets and liabilities related  
to the site are classified as assets held for sale.

Assets classified as held for sale 

Property, plant and equipment including costs incurred in preparing site for sale 

Total assets held for sale 

14. Acquisition of businesses

Consolidated

2010 
$000 

7,677 

7,677 

2009
$000

–

–

On 3 August 2009, the group acquired the shares in Richardson Seeds Pty Ltd and MMR Genetics. Richardson Seeds 
is a leading producer of sorghum seed hybrids and MMR Genetics is a global leader in the development of elite 
sorghum germplasm. Both businesses are based in Texas, US. On 30 March 2010, the group acquired the Druetto 
seed business based in Argentina. Druetto is focused on the breeding development, production, processing and 
sales of hybrid sorghum into the South American market. On 19 May 2010, the group acquired the oilseed and 
confection	sunflower	assets	of	California	based	Flower	Genetics	LLC.	Flower	Genetics	is	involved	in	the	breeding,	
production	and	marketing	of	elite	sunflower	hybrids.

In the period to 31 July 2010, these businesses contributed profit of $1,624,800 to the consolidated group after 
tax profit. If the above acquisition had occurred on 1 August 2009, the full-year contribution to group revenues 
would have been $45.093 million and to the consolidated entity’s profit after tax would have been $4.962 million. 

2010

Acquiree’s net assets at acquisition date 

Cash and cash equivalents 
Receivables 
Inventory 
Property, plant and equipment 
Other assets 
Trade and other payables 
Interest bearing loans and borrowings 
Other liabilities 

Net identifiable assets and liabilities 

Intangibles acquired on acquisition 
Goodwill on acquisition 

Consideration paid 
Cash acquired 

Net	cash	outflow	

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

70

Pre-acquisition  Preliminary  Recognised 
carrying 
values on 
fair value 
amounts  adjustments  acquisition 
$000

$000 

$000 

345 
5,997 
11,911 
3,982 
1,099 
(1,871) 
(7,480) 
(5,054) 

8,929 

– 
– 
496 
2,799 
81 
– 
– 
– 

3,376 

345
5,997
12,407
6,781
1,180
(1,871)
(7,480)
(5,054)

12,305

13,707
17,961

43,973
(345)

43,628

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
	
	
notes to the financial statements continued

14. Acquisition of businesses (continued)

Pre-acquisition carrying values were determined based on applicable AASBs immediately before the acquisition. 
The value of assets, liabilities and contingent liabilities recognised on acquisition are their estimated fair values 
(see note 4 for methods used in determining fair values).

Goodwill has arisen on the acquisitions above, mainly resulting from the technical expertise and know-how 
included in the acquired businesses and from the synergies that the acquisitions bring to the Nufarm group. 

On 1 October 2008, the group acquired the shares in Lefroy Seeds Pty Ltd. Lefroy Seeds specialises in hybrid 
breeding,	production	and	commercialisation	activities	in	sunflower	and	sorghum	with	facilities	located	in	 
Toowoomba, Queensland, Australia.

2009 

Acquiree’s net assets at acquisition date  

Cash and cash equivalents 
Receivables 
Inventory 
Property, plant and equipment 
Intangibles 
Other assets 
Trade and other payables 
Employee benefits 
Other liabilities 

Net identifiable assets and liabilities 

Acquisition costs  
Identifiable intangibles acquired on acquisition  
Goodwill on acquisition  

Consideration paid  
Cash acquired  
Consideration satisfied by issue of shares 

Net	cash	outflow		

15. Cash and cash equivalents

Bank balances 
Call deposits 

Cash and cash equivalents 
Bank overdrafts repayable on demand 

Cash	and	cash	equivalents	in	the	statement	of	cash	flows	

Recognised 

Fair value 
values  adjustments 
$000 

$000 

175 
353 
236 
167 
8 
621 
(113) 
(21) 
(68) 

1,358 

– 
– 
102 
– 
(8) 
– 
– 
(85) 
– 

9 

Carrying
amounts
$000

175 
353 
338 
167 
– 
621 
(113)
(106)
(68)

1,367 

(46)
5,074 
5,075 

11,470 
(175)
(7,975)

3,320	

Consolidated

2010 
$000 

113,922 
74,819 

188,741 
(28,036) 

160,705	

2009
$000

48,502 
35,810 

84,312 
(35,669)

48,643	

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

71

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
	
	
 
 
 
notes to the financial statements continued

16. Trade and other receivables

Current 
Trade receivables 
Provision for impairment losses 

Receivables due from associates 
Derivative financial instruments 
Proceeds receivable from sale of businesses 
Other receivables and prepayments 

Current receivables 

Non-current 
Receivables due from associates 
Other receivables 
Proceeds receivable from sale of businesses 
Provision for non-collectability of sale proceeds 

Non-current receivables 

Consolidated

2010 
$000 

2009
$000

755,475 
(26,677) 

728,798 

473 
43,801 
9,233 
70,681 

852,986 

38 
9,569 
9,735 
– 

19,342 

680,573 
(25,087)

655,486 

475 
16,118 
6,230 
109,451 

787,760 

38 
9,319 
27,101 
(3,333)

33,125 

Total trade and other receivables 

872,328 

820,885 

Nufarm and a major supplier are currently in dispute with respect to a claim that the supplier is liable for a 
relevant share of losses attributable to the sale of product during the 2009 and 2010 financial years. 

The parties entered into an Agreement in 2002 that provides for the sharing of costs and proceeds associated 
with Nufarm’s sale of products. Nufarm’s claim, for approximately $52.7 million (2009: $39.9 million), is being 
contested by the supplier. This matter is currently subject to arbitration proceedings. Nufarm is confident it  
will recover all of this amount and will vigorously pursue its claim. The claim is included in trade receivables. 

17. Inventories

Raw materials 
Work in progress 
Finished goods 

Provision for obsolescence of finished goods 

Total inventories 

Consolidated

2010 
$000 

155,707 
9,849 
391,119 

556,675 
(3,243) 

553,432 

2009
$000

223,461 
7,932 
571,003 

802,396 
(5,013)

797,383 

The finished goods and raw material values above are net of the net realisable value adjustments referred to in 
note 6. 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

72

 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

18. Tax assets and liabilities 

Current tax assets and liabilities 

The current tax asset for the group of $42,460,651 (2009: $48,973,455) represents the amount of income taxes 
recoverable in respect of prior periods and that arise from the payment of tax in excess of the amounts due to 
the relevant tax authority. The current tax liability for the group of $5,564,530 (2009: $17,771,673) represents  
the amount of income taxes payable in respect of current and prior financial periods. 

Deferred tax assets and liabilities

Recognised deferred tax assets and liabilities

Deferred tax assets and liabilities are attributable to the following:

Consolidated 

Property, plant and equipment 
Intangible assets 
Employee benefits 
Provisions 
Other items 
Tax value of losses carried  
forward 

Assets 

Liabilities 

Net

2010 
$000 

8,625 
6,629 
14,446 
9,641 
44,324 

2009 
$000 

9,467 
6,545 
14,889 
14,500 
35,541 

2010 
$000 

(22,188) 
(48,200) 
– 
– 
(10,032) 

2009 
$000 

(12,338) 
(52,275) 
– 
– 
(8,578) 

2010 
$000 

(13,563) 
(41,571) 
14,446 
9,641 
34,292 

2009
$000

(2,871)
(45,730)
14,889 
14,500 
26,963 

99,188 

122,994 

– 

– 

99,188 

122,994 

Tax assets/(liabilities) 
Set off of tax 

182,853 
(32,530) 

203,936 
(8,976) 

(80,420) 
32,530 

(73,191) 
8,976 

102,433 
– 

130,745 
– 

Net tax assets/(liabilities) 

150,323 

194,960 

(47,890) 

(64,215) 

102,433 

130,745 

Movement in temporary differences during the year

Consolidated 2010 

Property, plant and equipment 
Intangible assets 
Employee benefits 
Provisions 
Other items 
Tax value of losses carried  
forward 

Balance  Recognised  Recognised 
31.07.09 
$000 

Currency 
in equity  adjustment  movement 
$000 

in income 
$000 

Other  Balance
31.07.10
$000

$000 

$000 

(2,871) 
(45,730) 
14,889 
14,500 
26,963 

(27,563) 
(10,840) 
1,993 
(4,005) 
9,988 

122,994 

(7,459) 

– 
– 
835 
– 
777 

– 

130,745 

(37,886) 

1,612 

1,187 
3,615 
(1,131) 
(854) 
(2,327) 

(8,329) 

(7,839) 

15,684 
11,384 
(2,140) 
– 
(1,109) 

(13,563)
(41,571)
14,446 
9,641 
34,292 

(8,018) 

99,188 

15,801 

102,433 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

73

 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

18. Tax assets and liabilities (continued) 

Consolidated 2009 

Property, plant and equipment 
Intangibles assets 
Employee benefits 
Provisions 
Other items 
Tax value of losses carried  
forward 

Balance  Recognised  Recognised 
31.07.08 
$000 

Currency 
in equity  adjustment  movement 
$000 

in income 
$000 

Other  Balance
31.07.09
$000

$000 

$000 

(5,532) 
(33,100) 
11,956 
5,044 
9,095 

4,429 
(12,202) 
(2,601) 
9,654 
14,517 

48,568 

36,031 

24,750 

38,547 

– 
– 
3,363 
– 
1,683 

– 

5,046 

78 
(428) 
(293) 
(198) 
1,624 

(1,846) 
– 
2,464 
– 
44 

(2,871)
(45,730)
14,889 
14,500 
26,963 

(2,092) 

(1,309) 

51,768 

122,994 

52,430 

130,745 

Deferred tax assets and liabilities

Unrecognised deferred tax liability

At 31 July 2010, a deferred tax liability of $17,551,281 (2009: $18,450,432) relating to investments in subsidiaries 
has not been recognised because the company controls whether the liability will be incurred and it is satisfied 
that it will not be incurred in the foreseeable future. This amount represents the theoretical withholding tax 
payable if all overseas retained earnings were paid as dividends.

Unrecognised deferred tax assets

At 31 July 2010, there are unrecognised tax losses of $37,535,877 (2009: nil). These losses do not have an expiry 
date.

19. Investments accounted for using the equity method

The group accounts for investments in associates using the equity method. 

The group had the following significant investments in associates during the year:

Country 

Balance date 
of associate 

Percentage 
ownership and
voting interest
2009
2010 

Excel Crop Care Ltd  Agricultural chemicals manufacturer 
F&N joint ventures  Agricultural chemicals distributor 

31 March 
Eastern Europe  31 December 

India 

14.69 
50.00 

14.69
50.00

The 14.69 per cent investment in Excel Crop Care Ltd is equity accounted as Nufarm has two directors on the 
board	and,	together	with	an	unrelated	partner,	has	significant	influence	over	nearly	35	per	cent	of	the	shares	 
of the company. The relationship also extends to manufacturing and marketing collaborations.

The F&N joint ventures represents the group’s interest in three joint ventures with FMC Corporation, which 
operate in Poland, Czech Republic and Slovakia. The joint ventures sell Nufarm and FMC products within their 
country.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

74

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

19. Investments accounted for using the equity method (continued) 

Financial summary of material associates (at reporting date)

2010
Excel Crop Care Ltd 
F&N joint ventures 

2009
Excel Crop Care Ltd 
F&N joint ventures 

Profit 
Revenues  after tax 
(100%) 

(100%) 

Total 
assets 
(100%) 

Total 
liabilities 
(100%) 

  Net assets as 
reported by 
associates 
(100%) 

Share of
associate’s
net assets
equity
accounted

151,540 
61,568 

9,001 
(2,942) 

117,203 
61,973 

74,328 
61,613 

213,108 

6,059 

179,176 

135,941 

196,112 
77,347 

9,558 
649 

110,292 
70,070 

72,306 
66,429 

273,459 

10,207 

180,362 

138,735 

42,875 
360 

43,235 

37,986 
3,641 

41,627 

6,298 
180 

6,478 

5,580 
1,821 

7,401 

The financial summary information is from the financial statements as per the balance dates above.

Carrying value by major associate
Excel Crop Care Ltd 
F&N joint ventures 
Others 

Carrying value of associates 

Share of profit by major associate
Bayer CropSciences Nufarm Ltd 
Excel Crop Care Ltd 
F&N joint ventures 
Others 

Share of net profits of associates 

Consolidated

2010 
$000 

10,610 
180 
1,174 

11,964 

– 
1,447 
(1,449) 
49 

47 

2009
$000

9,803
1,812
853

12,468

1,837
1,090
97
56

3,080

The share of net profits has been derived from the latest management reports as at 31 July 2010 for the F&N 
joint ventures. The Excel Crop Care share of net profits is from the 30 June 2010 management accounts. Nufarm 
sold its 25 per cent share in Bayer CropSciences Nufarm Limited to Bayer CropSciences Limited at 31 July 2009.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

75

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

20. Other investments

Investments – available-for-sale
Balance at the beginning of the year 
New investments during the year 
Exchange valuation adjustment 

Balance at the end of the year 

Other investments
Other investments 

Total other investments 

The group’s investment in an unlisted entity is classified as available-for-sale.

21. Other non-current assets

Derivative financial instrument 

Consolidated

2010 
$000 

7,008 
– 
(527) 

6,481 

2009
$000

–
6,829
179

7,008

398 

434

6,879 

7,442

43 

43 

967

967

The derivative financial instrument is the market value of the interest rate cap relating to the NSS distribution 
base rate. 

22. Property, plant and equipment

Land 
and 

Leased 
plant and 
Plant and 
buildings  machinery  machinery 
$000 

$000 

$000 

Consolidated 

Cost
Balance at 1 August 2009  
Additions  
Additions through business combinations 
Disposals  
Transfer to assets held for sale  
Other transfers  
Exchange adjustment 

207,393 
2,079 
 6,382 
(3,639) 
(7,040) 
11,444 
(13,174) 

663,878 
8,281 
5,413 
(87,201) 
(6,431) 
38,684 
(57,999) 

2010 

14,469 
41 
– 
(963) 
– 
(505) 
(1,739) 

Capital 
work in 
progress 
$000 

35,876 
41,935 
– 
(13) 
– 
(49,623) 
(2,610) 

Total 
$000

921,616 
52,336 
11,795 
(91,816)
(13,471)
– 
(75,522)

Balance at 31 July 2010  

203,445 

564,625 

11,303 

25,565 

804,938 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

76

 
 
 
 
 
 
 
 
  
 
 
 
 
 
 
 
notes to the financial statements continued

22. Property, plant and equipment (continued) 

Land 
and 

Leased 
plant and 
Plant and 
buildings  machinery  machinery 
$000 

$000 

$000 

Consolidated 

Depreciation and impairment losses
Balance at 1 August 2009  
Depreciation charge for the year 
Additions through business combinations 
Disposals 
Transfer to assets held for sale 
Other transfers 
Exchange adjustment  

(65,103) 
(6,971) 
(1,328) 
3,317 
3,972 
15 
6,294 

(419,596) 
(34,791) 
(3,686) 
84,537 
3,082 
(205) 
39,292 

Balance at 31 July 2010  

(59,804) 

(331,367) 

2010 

(1,449) 
(331) 
– 
963 
– 
190 
95 

(532) 

Capital 
work in 
progress 
$000 

– 
– 
– 
– 
– 
– 
– 

– 

Total 
$000

(486,148)
(42,093)
(5,014)
88,817 
7,054 
– 
45,681 

(391,703)

Net property, plant and equipment  
at 31 July 2010 

143,641 

233,258 

10,771 

25,565 

413,235 

Land 
and 

Leased 
plant and 
Plant and 
buildings  machinery  machinery 
$000 

$000 

$000 

Capital 
work in 
progress 
$000 

Total 
$000

Consolidated 

Cost
Balance at 1 August 2008 
Additions 
Additions through business  
combinations 
Disposals 
Other transfers 
Exchange adjustment 

2009 

201,006 
3,039 

646,118 
12,196 

15,156 
166 

30,395 
44,437 

892,675 
59,838 

– 
(4,030) 
4,795 
2,583 

280 
(28,022) 
32,684 
622 

– 
(80) 
(104) 
(669) 

– 
(1,380) 
(37,375) 
(201) 

280 
(33,512)
– 
2,335 

Balance at 31 July 2009 

207,393 

663,878 

14,469 

35,876 

921,616 

Depreciation and impairment losses
Balance at 1 August 2008 
Depreciation charge for the year 
Additions through business combinations 
Disposals 
Other transfers 
Exchange adjustment 

(58,689) 
(7,460) 
– 
2,223 
(33) 
(1,144) 

(399,701) 
(40,525) 
(113) 
20,591 
(7) 
159 

Balance at 31 July 2009 

(65,103) 

(419,596) 

(1,173) 
(427) 
– 
55 
40 
56 

(1,449) 

– 
– 
– 
– 
– 
– 

– 

(459,563)
(48,412)
(113)
22,869 
– 
(929)

(486,148)

Net property, plant and equipment  
at 31 July 2009 

142,290 

244,282 

13,020 

35,876 

435,468 

Assets pledged as security for finance leases totalled $10.77 million (2009: $13.02 million). There were no 
impairment losses in the consolidated entity in the current financial year or the comparative year.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

77

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

23. Intangible assets

Consolidated 

Cost
Balance at 1 August 2009 
Additions 
Additions through business  
combinations 
Disposals 
Other transfers 
Exchange adjustment 

Intellectual property  
indefinite  definite  development  Computer 
software 
$000 

costs 
$000 

life 
$000 

life 
$000 

Capitalised 

Goodwill 
$000 

Total
$000

2010

358,570 
– 

454,582 
3,731 

84,547 
1,110 

98,142 
25,693 

21,745  1,017,586 
33,307 

2,773 

17,961 
– 
– 
(17,921) 

9,201 
(1,365) 
(2,956) 
(28,444) 

4,506 
(48) 
2,956 
(7,231) 

– 
(1,125) 
– 
(8,014) 

– 
– 
– 
(1,331) 

31,668 
(2,538)
– 
(62,941)

Balance at 31 July 2010 

358,610 

434,749 

85,840 

114,696 

23,187  1,017,082 

Amortisation and impairment  
losses
Balance at 1 August 2009 
Amortisation charge for the year 
Exchange adjustment 

(72,262) 
– 
5,160 

(10,468) 
– 
1,172 

(39,964) 
(7,133) 
3,283 

(32,008) 
(6,218) 
3,230 

(14,145) 
(2,104) 
1,134 

(168,847)
(15,455)
13,979 

Balance at 31 July 2010 

(67,102) 

(9,296) 

(43,814) 

(34,996) 

(15,115) 

(170,323)

Intangibles carrying amount  
at 31 July 2010 

291,508 

425,453 

42,026 

79,700 

8,072 

846,759 

Intellectual property  
indefinite  definite  development  Computer 
software 
$000 

costs 
$000 

life 
$000 

life 
$000 

Capitalised 

Goodwill 
$000 

Total
$000

Consolidated 

Cost
Balance at 1 August 2008 
Additions 
Additions through business  
combinations 
Disposals 
Exchange adjustment 

2009

360,327 
9,109 

441,333 
10,339 

75,941 
818 

75,586 
24,847 

18,164 
3,565 

971,351 
48,678 

5,075 
(10,824) 
(5,117) 

5,074 
(13,467) 
11,303 

– 
(35) 
7,823 

– 
(3,425) 
1,134 

– 
(4) 
20 

10,149 
(27,755)
15,163 

Balance at 31 July 2009 

358,570 

454,582 

84,547 

98,142 

21,745  1,017,586 

Amortisation and impairment  
losses
Balance at 1 August 2008 
Amortisation charge for the year 
Exchange adjustment 

(73,303) 
– 
1,041 

(10,207) 
– 
(261) 

(29,354) 
(8,776) 
(1,834) 

(25,243) 
(6,386) 
(379) 

(11,744) 
(2,388) 
(13) 

(149,851)
(17,550)
(1,446)

Balance at 31 July 2009 

(72,262) 

(10,468) 

(39,964) 

(32,008) 

(14,145) 

(168,847)

Intangibles carrying amount  
at 31 July 2009 

286,308 

444,114 

44,583 

66,134 

7,600 

848,739 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

78

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

23. Intangible assets (continued)

The major intangibles with an indefinite economic life are the product registrations that Nufarm owns. These 
registrations are considered to have an indefinite life because, based on past experience, they will be renewed  
by the relevant regulatory authorities and the underlying products will continue to be commercialised and available 
for sale in the foreseeable future. The company will satisfy all of the conditions necessary for renewal and the 
cost of renewal is minimal. In determining that the registrations have indefinite useful life, the principal factor that 
influenced	this	determination	is	the	expectation	that	the	existing	registration	will	not	be	subject	to	significant	
amendment in the foreseeable future.

The group has determined that legal entity by country is the appropriate method for determining the cash-generating
units	(CGU)	of	the	business.	This	level	of	CGU	aligns	with	the	cash	flows	of	the	business	and	the	management	
structure of the group. The goodwill and intellectual property with an indefinite life are CGU specific, as the 
acquisitions generating goodwill and the product registrations that are the major indefinite intangibles are  
country specific in nature. There is no allocation of goodwill between CGUs.

The major CGUs and their intangible value is as follows: Brazil $294 million, US $165 million, seeds business 
$102 million, UK and Holland $56 million, AH Marks business $37 million, Australia $53 million and France  
$24 million. The balance of intangibles is spread across multiple CGUs, with no individual amount being  
material relative to the total intangibles at balance date.

For the impairment testing of these assets, the carrying amount of relevant assets is compared to their recoverable 
amount at a CGU level. The group uses the value-in-use method to estimate the recoverable amount. In assessing 
value-in-use,	the	estimated	future	cash	flows	are	derived	from	the	five	year	plan	for	each	CGU	with	a	growth	factor	
applied	to	extrapolate	cash	flows	over	a	maximum	period	of	20	years.	The	20	year	time	limit	has	been	used	on	
the basis that this period most closely aligns with the product registration life in most geographies. The revenue 
and margin assumptions contained in the five year plans are based on a return to normal pricing and volume 
conditions within the relevant market from 2011, particularly in relation to sales of glyphosate which contributes 
significantly to forecast profitability in a number of CGUs including Australia, the US, Brazil and certain European 
countries. The growth rate assumed for each CGU is based on an assessment of historical and expected growth 
over	the	period,	ranging	from	zero	per	cent	to	10	per	cent.	The	cash	flows	are	then	discounted	to	a	present	value	
using a discount rate of 10.9 per cent, which is the group’s weighted average cost of capital. At 31 July 2010,  
the recoverable amount exceeded the carrying amount for all CGUs.

Sensitivity analysis on the impairment testing was performed on management’s valuation calculations using a zero 
growth rate for all CGUs. There were no impairment issues under this scenario. Sensitivity analysis was also done 
around the discount rate, assuming a one per cent increase and one per cent decrease in the discount rate. Again, 
no impairment issues arose.

Further impairment analysis was undertaken in relation to the Brazilian CGU, where a significant amount of the 
value-in-use supporting the CGU’s assets is expected to be derived outside of the five year plan period. The five 
year plan assumes a return to trading profitability in 2011, with significant annual growth in EBITDA over the five 
year period. A growth rate of five per cent was applied to years after 2015 based on observable market forecasts 
relevant to the country and the industry sector. A future impairment charge against the Brazilian CGU assets 
could arise should forecast profitability and/or growth rate assumptions not be achieved.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

79

 
 
 
 
 
notes to the financial statements continued

24. Trade and other payables 

Current payables – unsecured
Trade creditors and accruals – unsecured 
Payables due to associated entities 
Derivative financial instruments 
Payables – acquisitions 

Current payables 

Non-current payables – unsecured
Creditors and accruals 
Payables – acquisitions 

Non-current payables 

25. Interest-bearing loans and borrowings

This note provides information about the contractual terms of the group’s  
interest-bearing loans and borrowings.

Current liabilities
Bank loans – unsecured 
Other loans – unsecured 
Finance lease liabilities – secured 

Current liabilities 

Non-current liabilities
Bank loans – unsecured 
Other loans – unsecured 
Finance lease liabilities – secured 

Non-current liabilities 

Consolidated

2010 
$000 

2009
$000

383,332 
583 
306 
9,647 

393,868 

376,432 
608 
9,250 
21,131 

407,421 

9,523 
6,326 

9,452 
8,243 

15,849 

17,695 

765,277 
669 
182 

766,128 

117 
1,684 
11,832 

13,633 

583,961 
314 
417 

584,692 

387,048 
1,522 
13,757 

402,327 

Financing facilities
At 31 July 2010, the group had access to facilities of $1.247 billion under the deed of negative pledge (dated  
24 October 1996). However, at that date the group was in breach of certain covenants under the deed and the 
parties to the deed have subsequently confirmed that any undrawn facility amounts are no longer available to the 
group. The group has obtained its required funding through to 15 December 2010 on a secured basis. See note 
2(b) for further details.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

80

 
 
 
 
 
 
 
 
notes to the financial statements continued

25. Interest-bearing loans and borrowings (continued)

2010
Bank loan facilities 
Other facilities 

Total financing facilities 

2009
Bank loan facilities 
Other facilities 

Total financing facilities 

Financing arrangements

Bank loans

Repayment of borrowings (excluding finance leases) 

Period ending 31 July 2010 
Period ending 31 July 2011 
Period ending 31 July 2012 
Period ending 31 July 2013 
Period ending 31 July 2014 or later 

Finance lease liabilities

Finance leases are entered into to fund the acquisition of plant and equipment.  
Lease commitments for capitalised finance leases are payable as follows:

Not later than one year 
Later than one year but not later than two years 
Later than two years but not later than five years 
Later than five years 

Less future finance charges 

Finance lease liabilities 

Finance lease liabilities are secured over the relevant leased plant. 

Average interest rates 

Nufarm Step-up Securities 
Bank loans 
Other loans 
Finance lease liabilities – secured 

Consolidated

Accessible 
$000 

Utilised
$000

1,449,865 
2,353 

1,452,218 

793,430 
2,353 

795,783 

1,773,580 
1,836 

1,006,678 
1,836 

1,775,416 

1,008,514 

Consolidated

2010 
$000 

– 
793,982 
1,034 
745 
22 

2009
$000

619,944 
172,191 
137,571 
78,808 
–

1,500 
1,389 
4,017 
96,856 

103,762 
(91,748) 

1,854
1,704
4,618
113,111

121,287 
(107,113)

12,014 

14,174 

Consolidated

2010 
% 

5.55 
5.05 
6.00 
11.58 

2009
%

8.73 
5.03 
6.00 
11.69 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

81

 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

26. Employee benefits

Current
Liability for annual leave 
Liability for long service leave 

Current employee benefits 

Non-current
Present value of unfunded obligations 
Present value of funded obligations 
Fair value of fund assets – funded 

Recognised liability for defined benefit fund obligations 

Liability for annual leave 
Liability for long service leave 

Non-current employee benefits 

Total employee benefits 

Consolidated

2010 
$000 

15,950 
6,380 

22,330 

5,328 
112,438 
(87,900) 

29,866 

– 
9,023 

38,889 

61,219 

2009
$000

13,069 
7,602 

20,671 

5,114 
116,543 
(89,829)

31,828 

4,046 
7,231 

43,105 

63,776 

The consolidated entity makes contributions to defined benefit pension funds in the UK, Holland, France and 
Indonesia that provide defined benefit amounts for employees upon retirement.

  Consolidated 

2010 
$000 

2009 
$000 

2008 
$000 

2007 
$000 

2006
$000

Historical information 

Present value of defined benefit  
obligation 
Fair value of plan assets 

Surplus/(deficit) 

(29,866) 

(31,828) 

(24,902) 

(117,766) 
87,900 

(121,657) 
89,829 

(118,688) 
93,786 

(59,287) 
39,732 

(19,555) 

(62,587)
35,477 

(27,110)

Experience adjustments arising  
on plan liabilities 
Experience adjustments arising  
on plan assets 

1,103 

(1,223) 

700 

321 

6,013 

(8,058) 

(10,088) 

1,687 

961 

586 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

82

 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

26. Employee benefits (continued)

Changes in the present value of the defined benefit obligation are as follows:
Opening defined benefit obligation 
Service cost 
Interest cost 
Actuarial loss 
Past service cost 
Losses/(gains) on curtailment 
Contributions 
Benefits paid 
Exchange differences on foreign funds 

Closing defined benefit obligation 

Changes in the fair value of fund assets are as follows:
Opening fair value of fund assets 
Expected return 
Actuarial gains/(losses) 
Surplus taken to retained earnings 
Contributions by employer 
Distributions 
Exchange differences on foreign funds 

Closing fair value of fund assets 

The actual return on plan assets is the sum of the expected return and  
the actuarial gain/(loss).

Expense recognised in profit or loss
Current service costs 
Interest on obligation 
Expected return on fund assets 
Past service cost 
Losses/(gains) on curtailment 

Expense recognised in profit or loss 

The expense is recognised in the following line items in the income statement:
Cost of sales 
Sales, marketing and distribution expenses 
General and administrative expenses 
Research and development expenses 

Expense recognised in profit or loss 

Consolidated

2010 
$000 

2009
$000

121,657 
2,865 
6,297 
10,934 
11 
(799) 
261 
(6,660) 
(16,800) 

117,766 

89,829 
5,268 
8,382 
(333) 
3,813 
(6,499) 
(12,560) 

87,900 

2,865 
6,297 
(5,268) 
11 
(799) 

3,106 

1,784 
712 
323 
287 

3,106 

118,688 
3,692 
7,768 
5,516 
5 
(4,301)
414 
(5,901)
(4,224)

121,657 

93,786 
6,707 
(7,017)
–
4,928
(5,126)
(3,449)

89,829

3,692
7,768
(6,707)
5
(4,301)

457

(1,134)
754
449
388

457

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

83

 
 
 
 
 
 
 
 
notes to the financial statements continued

26. Employee benefits (continued)

Actuarial gains/(losses) recognised in other comprehensive income (net of tax)
Cumulative amount at 1 August 
Recognised during the period 

Cumulative amount at 31 July 

The major categories of fund assets as a percentage of total fund assets are  
as follows:
European equities 
European bonds 
Property 
Cash 
Principal actuarial assumptions at the reporting date (expressed as weighted  
averages):
Discount rate at 31 July 
Expected return on fund assets at 31 July 
Future salary increases 
Future pension increases 

Consolidated

2010 
$000 

(7,525) 
(2,280) 

(9,805) 

2009
$000

929 
(8,454)

(7,525)

Consolidated

2010 
% 

2009
%

60.6 
37.5 
1.6 
0.3 

5.3 
6.7 
3.3 
2.9 

58.7
39.3
1.6
0.4

6.0
6.6
3.5
3.1

The overall expected long term rate of return on assets is 6.7 per cent. The expected rate of return on plan assets 
reflects	the	average	rate	of	earnings	expected	on	the	funds	invested	to	provide	for	the	benefits	included	in	the	
projected benefit obligation.

The group expects to pay $3,299,000 in contributions to defined benefit plans in 2011.

27. Share-based payments

The Nufarm Executive Share Plan (2000) offers shares to executives. The executives may select an alternative 
mix of shares (at no cost) and options at a cost determined under the ‘Black Scholes’ methodology. These benefits 
are only given when a predetermined return on capital employed is achieved over the relevant period. The shares 
and options are subject to forfeiture and dealing restrictions. The executive cannot deal in the shares or options 
for a period of between three and ten years without board approval. An independent trustee holds the shares and 
options on behalf of the executives. At 31 July 2010 there were 72 participants (2009: 77 participants) in the scheme 
and 1,237,872 shares (2009: 1,714,045) were allocated and held by the trustee on behalf of the participants. The 
cost of issuing shares is expensed in the year of issue.

The global share plan commenced in 2001, and is available to all permanent employees. Participants contribute  
a proportion of their salary to purchase shares. The company will contribute an amount equal to 10 per cent of 
the number of ordinary shares acquired with a participant’s contribution in the form of additional ordinary shares. 
Amounts over 10 per cent of the participant’s salary can be contributed but will not be matched. For each year 
the shares are held, up to a maximum of five years, the company contributes a further 10 per cent of the value  
of the shares acquired with the participant’s contribution. An independent trustee holds the shares on behalf  
of the participants. At 31 July 2010 there were 747 participants (2009: 763 participants) in the scheme and 
1,356,706 shares (2009: 1,710,550) were allocated and held by the trustee on behalf of the participants.  

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

84

 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

27. Share-based payments (continued)

The impact of the global share plan for the year ended 31 July 2010 was a reduction of expenses by $755,007. 
The reduction results from the lower share price at 31 July 2010 compared to 31 July 2009. For 2009, the cost  
of the global share plan was an expense of $306,865.

The power of appointment and removal of the trustees for the share purchase schemes is vested in the company.

28. Provisions

Current
Restructuring 
Other 

Current provisions 

Consolidated 

Movement in provisions
Balance at 1 August 2009  
Provisions made during the year  
Provisions used during the year  
Exchange adjustment  

Balance at 31 July 2010  

Consolidated

2010 
$000 

7,698 
4,065 

11,763 

Restructuring 
$000 

Other
provisions 
$000 

21,958 
3,821 
(15,189) 
(2,892) 

7,698 

4,133 
– 
– 
(68) 

4,065 

2009
$000

21,958 
4,133 

26,091 

Total 
$000 

26,091
3,821
(15,189)
(2,960)

11,763 

The provision for restructuring is mainly relating to the shutdown of two French manufacturing units and the 
associated redundancy costs. The other provision consists of contingent liabilities recognised with the Agripec 
acquisition.

29. Capital and reserves

Share capital 

Balance at 1 August 
Issue of shares 

Balance at 31 July 

Parent company

Number 
of ordinary 
shares 
2010 

Number 
of ordinary  
shares 
2009 

218,061,199 
43,714,532 

185,882,333 
32,178,866 

261,775,731 

218,061,199 

The company does not have authorised capital or par value in respect of its issued shares.

On 17 December 2009, 65,519 shares at $10.67 were issued under the global share plan. On 6 May 2010, 
25,019,852 shares at a price of $5.75 were issued under the institutional component of the company’s one for 
five renounceable rights offer. The retail component of the offer was completed on 28 May 2010, under which 
18,629,161 shares were issued at the same price of $5.75. 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

85

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

29. Capital and reserves (continued)

On 1 October 2008, 527,585 shares at $15.12 were issued as part of the acquisition cost of Lefroy Seeds  
Pty Ltd. On 20 October 2008, 198,450 shares at a price of $15.51 were issued under the executive share plan.  
On 17 November 2008, 805,960 shares at a price of $10.35 were issued under the dividend reinvestment plan.  
On 19 December 2008, 82,000 shares at a price of $9.56 were issued under the global share plan. On 8 May 
2009, 358,866 shares at a price of $12.16 were issued under the dividend reinvestment plan. On 21 May 2009, 
26,700,000 shares were issued at a price of $11.25 under an institutional placement to provide the group with 
enhanced	financial	flexibility	and	to	strengthen	the	balance	sheet.	On	30	June	2009,	3,506,005	shares	were	
issued at $10.18 under a share purchase plan to existing shareholders.

The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled  
to one vote per share at meetings of the company.

Nufarm Step-up Securities

In the year ended 31 July 2007 Nufarm Finance (NZ) Limited, a wholly owned subsidiary of Nufarm Limited, issued 
a new hybrid security called Nufarm Step-up Securities (NSS). The NSS are perpetual Step-up Securities and on 
24 November 2006, 2,510,000 NSS were allotted at an issue price of $100 per security raising $251 million. The 
NSS are listed on the ASX under the code ‘NFNG’ and on the NZDX under the code ‘NFFHA’. The after-tax costs 
associated with the issue of the NSS, totalling $4.1 million, have been deducted from the proceeds.

Distributions	on	the	NSS	are	at	the	discretion	of	the	directors	and	are	floating	rate,	unfranked,	non-cumulative	
and subordinated. However, distributions of profits and capital by Nufarm Limited are curtailed if distributions  
to NSS holders are not made, until such time that Nufarm Finance (NZ) Limited makes up the arrears. The first 
distribution	date	for	the	NSS	was	16	April	2007	and	on	a	six-monthly	basis	after	this	date.	The	floating	rate	is	the	
average mid-rate for bills with a term of six months plus a margin of 1.90 per cent. The step-up date is five years 
from issue date, and provides the issuer with the following options: (a) keep the NSS on issue whereby the 
margin will be reset or stepped up by the step-up margin; or (b) redeem the NSS for face value, or (c) change 
them for a number of ordinary shares in Nufarm Limited. The exchange ratio is calculated based on the average 
market price of Nufarm ordinary shares for 20 business days prior to exchange date less a 2.5 per cent discount.

Translation reserve

The translation reserve comprises all foreign exchange differences arising from the translation of the financial 
statements of foreign operations where their functional currency is different to the presentation currency of  
the reporting entity.

Capital profit reserve

This reserve is used to accumulate realised capital profits.

Dividends

Dividends recognised in the current year by the company are:

2010

Interim 2010 ordinary 
Final 2009 ordinary 

Total amount 

per share 

0.0 
15.0 

–

32,709  Unfranked  13 Nov 2009

32,709

Cents  Total amount 

Franked/ 
$000  unfranked 

Payment
date

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

86

 
 
 
 
 
 
 
 
notes to the financial statements continued

29. Capital and reserves (continued)

2009

Interim 2009 ordinary 
Final 2008 ordinary 

Total amount 

Cents  Total amount 

Franked/ 
$000  unfranked 

Payment
date

per share 

12.0 
23.0 

22,469  Unfranked  8 May 2009
Franked  17 Nov 2008
42,828 

65,297

Distributions recognised in the current year by Nufarm Finance (NZ) Ltd on the Nufarm Step-up Securities are:

2010
Distribution 
Distribution 

2009
Distribution 
Distribution 

Distribution 
rate 

Total amount 
$000 

Payment 
date

6.08% 
5.02% 

7,609  15 Apr 2010
6,313  15 Oct 2009

13,922

7.48% 
9.97% 

9,361  15 Apr 2009
12,547  15 Oct 2008

21,908

The distribution on the Nufarm Step-up Securities reported on the equity movement schedule has been reduced 
by the tax benefit on the gross distribution, giving an after-tax amount of $10.127 million (2009: $15.336 million).

Consolidated

2010 
$000 

2009
$000

Franking credit/(debit) balance 
The amount of franking credits available for the subsequent financial year are:

Franking account balance as at the end of the year at 30 per cent (2009: 30 per cent) 

18,871 

(1,374) 

Franking credits/(debits) that will arise from the payment of income tax payable/ 
(refund) as at the end of the year 

Balance at 31 July 

(2,939) 

15,932 

6,452 

5,078 

The impact on the dividend franking account of dividends proposed after the balance sheet date is zero as there 
is no dividend proposed for 2010. In accordance with the tax consolidation legislation, the company as the head 
entity in the tax-consolidated group has also assumed the benefit of $15,931,794 (2009: $5,078,270) franking credits.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

87

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

30. Earnings per share

Net profit/(loss) for the year 
Net profit/(loss) attributable to minority interest 

Net profit/(loss) attributable to equity holders of the parent 
Nufarm Step-up Securities distribution 

Earnings/(loss) used in the calculations of basic and diluted earnings per share 

Earnings/(loss) from continuing operations 

Consolidated

2010 
$000 

(22,652) 
(1,338) 

(23,990) 
(10,127) 

(34,117) 

(34,117) 

(34,117) 

2009
$000

80,542 
(665)

79,877 
(15,336)

64,541 

64,541 

64,541 

Subtract items of material income/(expense) (refer note 6) 

(82,556) 

(79,755)

Earnings excluding items of material income/(expense) used in the calculation  
of earnings per share excluding material items 

48,439 

144,296 

For the purposes of determining basic and diluted earnings per share, the after-tax distributions on NSS are 
deducted from net profit.

Number of shares

2010 

2009

Weighted average number of ordinary shares used in calculation of basic  
earnings per share 
Weighted average number of ordinary shares used in calculation of diluted  
earnings per share 

227,263,338 

192,664,368

227,263,338 

192,664,368

There have been no conversions to, calls of, or subscriptions for ordinary shares or issues of ordinary shares 
since the reporting date and before the completion of this financial report.

Earnings per share for continuing and discontinued operations
Basic earnings/(loss) per share
From continuing operations 

Diluted earnings/(loss) per share
From continuing operations 

Earnings per share (excluding items of material income/expense – see note 6)
Basic earnings per share 
Diluted earnings per share 

Cents per share

2010 

2009

(15.0) 

(15.0) 

(15.0) 

(15.0) 

21.3 
21.3 

33.5

33.5

33.5

33.5

74.9
74.9

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

88

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

31. Financial risk management and financial instruments

The group has exposure to the following financial risks:

•	 credit	risk;

•	 liquidity	risk;	and

•	 market	risk.

This note presents information about the group’s exposure to each type of the above risks, their objectives, 
policies and processes for measuring and managing risk, and the management of capital. 

The board of directors has responsibility to identify, assess, monitor and manage the material risks facing the 
group and to ensure that adequate identification, reporting and risk minimisation mechanisms are established and 
working effectively. To support and maintain this objective, the audit committee has established detailed policies 
on risk oversight and management by approving a global risk management charter that specifies the responsibilities 
of the general manager global risk management (which includes responsibility for the internal audit function). This 
charter also provides comprehensive global authority to conduct internal audits, risk reviews and system-based 
analyses of the internal controls in major business systems operating within all significant company entities 
worldwide.

The general manager global risk management reports to the chief executive officer and provides a written report 
of his activities at each meeting of the audit committee. In doing so he has direct and continual access to the 
chairman and members of the audit committee.

Credit risk

Credit risk is the risk of financial loss to the group if a customer or counterparty to a financial instrument fails  
to meet its contractual obligations, and arises principally from the group’s receivables from customers and other 
financial assets.

Exposure to credit risk

The	group’s	exposure	to	credit	risk	is	influenced	mainly	by	the	individual	characteristics	of	each	customer.	The	
demographics of the group’s customer base, including the default risk of the industry and country in which the 
customers	operate,	has	less	of	an	influence	on	credit	risk.

The group has credit policies in place and the exposure to credit risk is monitored on an ongoing basis. Credit 
evaluations are performed on all customers before the group’s standard payment and delivery terms and conditions 
are offered. Purchase limits are established for each customer, which represent the maximum open amount 
without requiring further management approval.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

89

 
 
 
 
 
notes to the financial statements continued

31. Financial risk management and financial instruments (continued)

The group’s maximum exposure to credit risk at the reporting date was:

Carrying amount
Trade and other receivables 
Cash and cash equivalents 
Interest rate cap:
Assets 
Forward exchange contracts:
Assets 

The group’s maximum exposure to credit risk for trade and other receivables  
at the reporting date by geographic region was:

Carrying amount
Australasia 
Europe 
North America 
South America 

Trade and other receivables 

The group’s top five customers account for $174.5 million of the trade receivables  
carrying amount at 31 July 2010 (2009: $139.4 million). These top five customer  
represent 22 per cent (2009: 19 per cent) of the total receivables.

Impairment losses

The ageing of the group’s trade receivables at the reporting date was:

Receivables ageing
Current 
Past due – 0 to 90 days 
Past due – 90 to 180 days 
Past due – 180 to 360 days 
Past due – more than one year 

Provision for impairment 

Trade receivables 

Consolidated

2010 
$000 

2009
$000

828,527 
188,741 

804,767 
84,312 

43 

967 

43,801 

16,118 

 1,061,112 

906,164

276,515 
253,224 
48,815 
249,973 

828,527 

276,653 
238,432 
44,284 
245,398 

804,767 

568,843 
53,941 
23,237 
72,610 
36,844 

755,475 
(26,677) 

728,798 

504,313 
130,284 
6,405 
11,877 
27,694 

680,573 
(25,087)

655,486 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

90

 
 
 
 
 
 
 
 
 
  
notes to the financial statements continued

31. Financial risk management and financial instruments (continued)

Some of the past due receivables are secured by collateral such as directors guarantees, bank guarantees and 
charges on fixed assets. The past due receivables not impaired relate to customers that have a good credit history 
with the group. Historically, the bad debt write-off from trade receivables has been very low. Over the past seven 
years, the bad debt write-off amount has averaged 0.02 per cent of sales, with no greater than 0.50 per cent of 
sales written off in any one year.

In the crop protection industry, it is normal practice to vary the terms of sales depending on the climatic conditions 
experienced in each country.

The movement in the allowance for impairment in respect of trade receivables during the year was as follows:

Balance at 1 August 
Provisions made during the year 
Provisions used during the year 
Provisions acquired through business combinations 
Exchange adjustment 

Balance at 31 July 

Consolidated

2010 
$000 

25,087 
3,007 
(536) 
114 
(995) 

26,677 

2009
$000

23,339 
12,201 
(9,139)
– 
(1,314)

25,087 

The allowance account for trade receivables is used to record the impairment losses unless the group is satisfied 
that no recovery of the amount owing is possible: at that point the amount is considered irrecoverable and is 
written off against the receivable directly. 

Liquidity risk

Liquidity risk is the risk that the group will not be able to meet its financial obligations as they fall due. The group’s 
approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet 
its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or 
risking damage to the group’s reputation.

Most group entities have entered into a deed of negative pledge dated 24 October 1996 (last amendment dated 
30 January 2009) with the group lenders which provides that all parties to the deed will guarantee to each creditor 
payment in full of any debt of each company participating in the deed. See note 35 for listing of entities who are 
a party to the deed. The deed of negative pledge allows all borrowings with group lenders to be on an unsecured 
basis.

At 31 July 2010, the group had access to facilities of $1.247 billion under the deed of negative pledge (dated  
24 October 1996). However, at that date the group was in breach of certain covenants under the deed and the 
parties to the deed have subsequently confirmed that any undrawn facility amounts are no longer available to the 
group. The group has obtained its required funding through to 15 December 2010 on a secured basis. See note 
2(b) for further details.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

91

 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

31. Financial risk management and financial instruments (continued)

The following are the contractual maturities of the group’s financial liabilities:

Carrying  Contractual 
cash flows 
amount 
$000 
$000 

Less than 
1 year 
$000 

1–2  More than
2 years
$000

years 
$000 

Consolidated 

Non-derivative financial liabilities
Bank overdrafts 
Trade and other payables 
Bank loans – unsecured 
Other loans – unsecured 
Finance lease liabilities – secured 

28,036 
409,411 
765,394 
2,353 
12,014 

28,036 
409,411 
765,394 
2,353 
12,014 

2010

28,036 
393,562 
765,277 
669 
182 

– 
6,326 
95 
1,012 
49 

– 
9,523 
22 
672 
11,783 

Derivative financial liabilities
Forward exchange contracts:
Outflow	
Inflow	

Derivative financial assets
Forward exchange contracts:
Outflow	
Inflow	

Consolidated 

Non-derivative financial liabilities
Bank overdrafts 
Trade and other payables 
Bank loans – unsecured 
Other loans – unsecured 
Finance lease liabilities – secured 

Derivative financial liabilities
Forward exchange contracts:
Outflow	
Inflow	

Derivative financial assets
Forward exchange contracts:
Outflow	
Inflow	

306	
–	

18,674	
(18,368)	

18,674	
(18,368)	

–	
–	

–	
(43,801)	

232,151	
(275,952)	

8,160	
(8,472)	

223,991	
(267,480)	

–	
–	

–	
–	

1,173,713 

1,173,713 

1,187,720 

(36,007) 

22,000 

Carrying  Contractual 
cash flows 
amount 
$000 
$000 

Less than 
1 year 
$000 

1–2  More than
2 years
$000

years 
$000 

35,669 
415,866 
971,009 
1,836 
14,174 

35,669 
415,866 
971,009 
1,836 
14,174 

2009

35,669 
398,171 
583,961 
314 
417 

– 
8,243 
171,605 
586 
186 

– 
9,452 
215,443 
936 
13,571 

9,250	
–	

111,290	
(102,040)	

111,290	
(102,040)	

–	
(16,118)	

295,046	
(311,164)	

40,021	
(40,488)	

–	
–	

–	
–	

–	
–	

255,025	
(270,676)

1,431,686 

1,431,686 

1,027,315 

180,620 

223,751 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

92

 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
 
  
notes to the financial statements continued

31. Financial risk management and financial instruments (continued)

Interest	on	borrowings	is	denominated	in	currencies	that	match	the	cash	flows	generated	by	the	underlying	
operations of the group. This provides an economic hedge and no derivatives are entered into.

Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity 
prices will affect the group’s income or the value of its holdings of financial instruments. The objective of market 
risk management is to manage and control market risk exposures within acceptable parameters, while optimising 
the return.

Currency risk

The group uses derivative financial instruments to manage specifically identified foreign currency risk on sales, 
purchases and borrowings that are denominated in a currency other than the functional currency of the individual 
group entity. The currencies giving rise to this risk are primarily the US Dollar, the Euro, the British Pound and the 
Brazilian Real. The consolidated entity uses forward exchange contracts to hedge its foreign currency risk. Most 
of the forward exchange contracts have maturities of less than three months after reporting date.

The group uses foreign exchange contracts to manage the foreign currency exposures between the Nufarm 
Step-up Securities issued in Australia and New Zealand, and related group funding to several jurisdictions to 
which the funds were advanced. The foreign exchange contracts primarily cover the exposure on the principal 
advanced to group companies in US Dollars, the Euro and the British Pound.

The	group	does	not	have	any	cash	flow	hedges	with	all	movements	in	fair	value	recognised	in	profit	or	loss	during	
the period. The net fair value of forward exchange contracts in the group used as economic hedges of forecast 
transactions at 31 July 2010 was $43,495,711 (2009: $6,867,549) comprising assets of $43,801,271 (2009: 
$16,118,071) and liabilities of $305,560 (2009: $9,250,522) that were recognised as derivatives measured  
at fair value.

Exposure to currency risk

The group’s exposure to major foreign currency risks at balance date was as follows, based on notional amounts: 

Consolidated 
31.07.2010 

Cash and cash equivalents 
Trade and other receivables 
Bank overdraft 
Trade and other payables 
Loans and borrowings 

Gross balance sheet exposure 

Forward exchange contracts 

Net exposure 

AUD 
$000 

74 
404 
– 
(267) 
– 

211 

USD 
$000 

30,531 
66,279 
(5,777) 
(86,797) 
(7) 

Euro 
$000 

964 
8,017 
– 
(12,039) 
(2,828) 

GBP
$000

13,767
35
(341)
–
–

4,229 

(5,886) 

13,461

– 

211 

(14,441) 

(10,212) 

2,636 

–

(3,250) 

13,461

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

93

 
 
 
 
 
notes to the financial statements continued

31. Financial risk management and financial instruments (continued)

Currency risk (continued)

Exposure to currency risk (continued)

Consolidated 
31.07.2009 

Cash and cash equivalents 
Trade and other receivables 
Bank overdraft 
Trade and other payables 
Loans and borrowings 

AUD 
$000 

80 
275 
– 
(1,122) 
– 

USD 
$000 

7,328 
88,947 
(4,431) 
(28,936) 
(86,521) 

Euro 
$000 

2,263 
4,477 
– 
(10,408) 
(5,914) 

Gross balance sheet exposure 

(767) 

(23,613) 

(9,582) 

Forward exchange contracts 

Net exposure 

(558) 

(1,325) 

84,577 

60,964 

(17,732) 

(27,314) 

The following significant exchange rates applied during the year:

GBP
$000

–
194
(64)
(435)
–

(305)

–

(305)

AUD 

US Dollar 
Euro 
GBP 
BRL 

Sensitivity analysis

Average rate 

Reporting date

2010 

0.888 
0.649 
0.568 
1.592 

2009 

0.737 
0.541 
0.465 
1.524 

2010 

0.903 
0.693 
0.576 
1.584 

2009

0.835 
0.585 
0.500 
1.558 

A 10 per cent strengthening or weakening of the Australian dollar against the following currencies at 31 July 
would have increased/(decreased) profit or loss by the amounts shown below. This analysis assumes all other 
variables, including interest rates, remain constant. The analysis also assumes that any increases in raw material 
costs arising from changes in exchange rates are not passed on to customers by way of selling prices. In the 
market place, nearly all raw material cost increases are passed onto customers and therefore, the profit or loss 
impact	below	is	not	truly	reflective	of	the	full	profit	or	loss	impact	of	changes	in	exchange	rates.	The	analysis	 
is performed on the same basis for 2009.

10 per cent  
strengthening 

10 per cent 
weakening

Consolidated 
profit or 
loss 
$000 

Consolidated
profit or
loss
$000

1,028 
426 
(2,125) 

(6,637) 
4,245 
55 

(1,131)
(469)
2,337

7,301
(4,669)
(61)

31 July 2010

US Dollar 
Euro 
GBP 

31 July 2009
US Dollar 
Euro 
GBP 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

94

 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

31. Financial risk management and financial instruments (continued)

Interest rate risk

The group has the ability to use derivative financial instruments to manage specifically identified interest rate 
risks. Interest rate swaps, denominated in AUD, are entered into to achieve an appropriate mix of fixed and 
floating	rate	exposures.	However,	at	31	July	2010	and	at	31	July	2009,	there	were	no	interest	rate	swaps	in	place.

Cash	flow	risk	on	Nufarm	Step-up	Securities

The	group	uses	interest	rate	caps	to	protect	the	cash	flow	impact	of	a	movement	in	the	distribution	base	rate.	
The distribution rate is the average mid-rate for bank bills with a term of six months plus a margin of 1.90 per cent.

Profile

At the reporting date the interest rate profile of the group and company’s interest-bearing financial instruments was: 

Variable rate instruments 
Financial assets  
Financial liabilities  

Consolidated 
carrying amount

2010 
$000 

2009
$000

74,819 
(807,797) 

35,810 
(1,022,688)

(732,978) 

(986,878)

There were no fixed interest rate instruments during the year ended 31 July 2010 (2009: Nil).

Sensitivity analysis for variable rate instruments

A change of 100 basis points in interest rates at the reporting date would have increased/(decreased) profit or 
loss by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency 
rates, remain constant. The sensitivity is calculated on the debt at 31 July. Due to the seasonality of the crop 
protection business, debt levels can vary during the year. This analysis is performed on the same basis for 2009.

31 July 2010

Variable rate instruments 

Total sensitivity 

31 July 2009

Variable rate instruments 

Total sensitivity 

Profit and loss

100bp 
increase 
$000 

100bp 
decrease
$000

(7,330) 

(7,330) 

(9,869) 

(9,869) 

7,330

7,330

9,869

9,869

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

95

 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

31. Financial risk management and financial instruments (continued)

Fair values

Fair values versus carrying amounts

The fair values of financial assets and liabilities, together with the carrying amounts shown in the balance sheet, 
are as follows:

Consolidated 

Note 

Cash and cash equivalents 
Trade and other receivables 
Interest rate cap:
Payable maturities – one to five years 
Forward exchange contracts:
Assets 
Liabilities 
Bank overdraft 
Unsecured bank loans 
Other loans 
Finance leases 

15 
16 

21 

16 
24 
15 
25 
25 
25 

Carrying 
amount 
2010 
$000 

188,741 
828,527 

Fair 
value 
2010 
$000 

188,741 
828,527 

Carrying 
amount 
2009 
$000 

84,312 
804,767 

Fair
value 
2009
$000

84,312 
804,767 

43 

43 

967 

967 

43,801 
(306) 
(28,036) 
(765,394) 
(2,353) 
(12,014) 

43,801 
(306) 
(28,036) 
(765,394) 
(2,353) 
(12,014) 

16,118 
(9,250) 
(35,669) 
(971,009) 
(1,836) 
(14,174) 

16,118 
(9,250)
(35,669)
(971,009)
(1,836)
(14,174)

253,009 

253,009 

(125,774) 

(125,774)

Fair value hierarchy
The table below analyses financial instruments carried at fair value, by valuation method. The different levels 
have been defined as follows:

•	 Level	1:	quoted	prices	(unadjusted)	in	active	markets	for	identical	assets	or	liabilities;

•	 Level	2:	inputs	other	than	quoted	prices	included	within	Level	1	that	are	observable	for	the	asset	or	liability,	

either directly (i.e., as prices) or indirectly (i.e., derived from prices); and

•	 Level	3:	inputs	for	the	asset	or	liability	that	are	not	based	on	observable	market	data	(unobservable	inputs).

31 July 2010 

Derivative financial assets 

Derivative financial liabilities 

31 July 2009 

Derivative financial assets 

Derivative financial liabilities  

Level 1 
$000 

– 

– 

– 

– 

Level 1 
$000 

– 

– 

– 

Consolidated

Level 2 
$000 

43,844 

43,844 

(306) 

43,538 

Level 3 
$000 

– 

– 

– 

– 

Consolidated

Level 2 
$000 

17,085 

17,085 

(9,250) 

7,835 

Level 3 
$000 

– 

– 

– 

– 

Total
$000

43,844 

43,844 

(306)

43,538 

Total
$000

17,085 

17,085 

(9,250)

7,835 

There have been no transfers between levels in either 2010 or 2009.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

96

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

31. Financial risk management and financial instruments (continued)

Capital management

The board’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence 
and to sustain future development of the business. The board of directors monitors the group’s return on funds 
employed (ROFE). Return is calculated on the group’s earnings before interest and tax and adjusted for any 
non-operating items. Funds employed is defined as shareholder’s funds plus total interest bearing debt. The 
board of directors determines the level of dividends to ordinary shareholders. The board also reviews the  
group’s total shareholder return with relevant comparator groups.

The board believes ROFE is an appropriate performance condition as it ensures management is focused on the 
efficient use of capital and the measure remains effective regardless of the mix of equity and debt, which may 
change from time to time. The group’s target ROFE is 17.25 per cent; during the year ended 31 July 2010 the 
return was 5.5 per cent (2009: 11.7 per cent).

There were no changes in the group’s approach to capital management during the year.

32. Operating leases

Non-cancellable operating lease rentals are payable as follows:

Not later than one year 
Later than one year but not later than two years 
Later than two years but not later than five years 
Later than five years 

Operating leases are generally entered to access the use of shorter term  
assets such as motor vehicles, mobile plant and office equipment. Rentals  
are fixed for the duration of these leases. There is a small number of leases  
for office properties. These rentals have regular reviews based on market  
rentals at the time of review. 

33. Capital commitments

Capital expenditure commitments 
Plant and equipment
Contracted but not provided for and payable:
Within one year 

Consolidated

2010 
$000 

9,873 
9,139 
17,713 
151,579 

188,304 

2009
$000

10,793 
9,479 
20,290 
180,300 

220,862 

11,274 

12,021 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

97

 
 
 
 
 
 
 
 
 
notes to the financial statements continued

34. Contingencies

The directors are of the opinion that provisions are not required in respect of the following matters, as it is not 
probable that a future sacrifice of economic benefits will be required or the amount is not capable of reliable 
measurement.

The parent entity together with all the material wholly owned controlled entities have entered into a negative 
pledge deed with the group’s lenders whereby all group entities, which are a party to the deed, have guaranteed 
repayment of all liabilities in the event that any of these companies are wound up.

Guarantee facility for Eastern European joint ventures with FMC Corporation. 

Environmental guarantee given to the purchaser of land and buildings  
at Genneviliers for EUR 8.5 million. The guarantee expires in 2014,  
18 months after the expiry of the business tenancy contract. 

Guarantee upon sale of a business limited to EUR 2.29 million on account  
of possible remediation costs for soil and groundwater contamination. This  
guarantee decreases from 2004 progressively to nil in 2011. 

Consolidated

2010 
$000 

6,076 

2009
$000

10,276 

12,265  

14,530 

3,304 

3,915 

Insurance bond for EUR 2.717 million established to make certain capital  
expenditures at Gaillon plant in France. The insurance bond is for a three year term. 

3,921 

4,644 

Bank guarantee for Holland defined benefit pension plan to ensure coverage ratios. 

– 

342 

Contingent liabilities 

35. Group entities 

Parent entity 
Nufarm Limited – ultimate controlling entity

Subsidiaries
Access Genetics Pty Ltd 
ACN000425927 Pty Ltd  
Agcare Biotech Pty Ltd 
Agchem Receivables Corporation 
Agryl Holdings Limited  
Ag-seed Research Pty Ltd 
Agturf Inc 
AH Marks (New Zealand) Limited 
AH Marks Australia Pty Ltd 
AH Marks Holdings Limited  
Artfern Pty Ltd 
Australis Services Pty Ltd  
Bestbeech Pty Ltd  

25,566 

33,707 

Notes 

Place of 
incorporation 

Percentage
of shares held

2010 

2009

(a),(b) 

(a),(b) 

(b) 
(a) 
(a) 
(a) 

Australia 
Australia 
Australia 
US 
Australia 
Australia 
US 
New Zealand 
Australia 
United Kingdom 
Australia 
Australia 
Australia 

100 
100 
70 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 

100 
100 
70 
100 
100 
100 
– 
100 
100 
100 
100 
100 
100 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

98

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

35. Group entities (continued)

Chemicca Limited  
CNG Holdings BV 
Crop Care Australasia Pty Ltd  
Crop Care Holdings Limited 
Croplands Equipment Limited  
Croplands Equipment Pty Ltd  
Danestoke Pty Ltd 
Edgehill Investments Pty Ltd 
Fchem (Aust) Limited 
Fernz Canada Limited  
Fernz Singapore Pte Ltd  
Fidene Limited 
Finotech BV (Liquidated)  
First Classic Pty Ltd 
Framchem SA 
Frost Technology Corporation 
Greenfarm Hellas Chemicals SA  
Growell Limited 
Grupo Corporativo Nufarm SA 
Laboratoire European de Biotechnologie s.a.s 
Le Moulin des Ecluses s.a  
Lefroy Seeds Pty Ltd 
Les Ecluses de la Garenne s.a.s 
Manaus Holdings Sdn Bhd  
Marman (Nufarm) Inc 
Marman de Guatemala Sociedad Anomima 
Marman de Mexico Sociedad Anomima  
De Capital Variable 
Marman Holdings LLC 
Mastra Corporation Pty Ltd  
Mastra Corporation Sdn Bhd  
Mastra Corporation USA Pty Ltd 
Mastra Holdings Sdn Bhd  
Mastra Industries Sdn Bhd  
Medisup International NV 
Medisup Securities Limited 
Midstates Agri Services de Mexico 
Midstates Agri Services Inc 
MMR Genetics Ltd 
Nufarm (Asia) Pte Ltd  
Nufarm Africa SARL AU 
Nufarm Agriculture (Pty) Ltd 
Nufarm Agriculture Inc  
Nufarm Agriculture Inc (USA) 
Nufarm Agriculture Zimbabwe (Pvt) Ltd 
Nufarm Americas Holding Company  
Nufarm Americas Inc  

Notes 

(a) 

(a),(b) 

(b) 
(a),(b) 

(a),(b) 
(b) 
(b) 

(b) 

(b) 

(b) 

(b) 

(b) 

(b) 
(b) 

(b) 
(b) 

(a),(b) 

(b) 

(b) 

(b) 
(b) 

Place of 
incorporation 

Australia 
Netherlands 
Australia 
New Zealand 
New Zealand 
Australia 
Australia 
Australia 
Australia 
Canada 
Singapore 
New Zealand 
Netherlands 
Australia 
Egypt 
US 
Greece 
United Kingdom 
Guatemala 
France 
France 
Australia 
France 
Malaysia 
US 
Guatemala 

Mexico 
US 
Australia 
Malaysia 
Australia 
Malaysia 
Malaysia 
N. Antillies 
Australia 
Mexico 
US 
US 
Singapore 
Morocco 
South Africa 
Canada 
US 
Zimbabwe 
US 
US 

Percentage
of shares held

2010 

2009

100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
– 
100 
100 
100 
100 
50 
100 
100 
100 
100 
100 
100 
100 
100 

100 
100 
70 
70 
70 
70 
70 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 

100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
50 
– 
100 
100 
100 
100 
100 
100 
100 

100 
100 
70 
70 
70 
70 
70 
100 
100 
– 
– 
– 
100 
– 
100 
100 
100 
100 
100 
100 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

99

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

35. Group entities (continued)

Nufarm Asia Sdn Bhd 
Nufarm Australia Limited  
Nufarm BV  
Nufarm Canada Receivables Partnership 
Nufarm Chemical (Shanghai) Co Ltd 
Nufarm Chile Limitada  
Nufarm Colombia S.A.  
Nufarm Crop Products UK Limited  
Nufarm de Costa Rica 
Nufarm de Guatemala SA 
Nufarm de Mexico Sa de CV 
Nufarm de Panama SA 
Nufarm de Venezuela SA 
Nufarm del Ecuador SA 
Nufarm Deutschland GmbH  
Nufarm do Brazil LTDA 
Nufarm Espana SA  
Nufarm Finance (NZ) Limited  
Nufarm GmbH  
Nufarm GmbH & Co KG  
Nufarm GmbH (liquidated)  
Nufarm Grupo Mexico 
Nufarm Holdings (NZ) Limited  
Nufarm Holdings BV  
Nufarm Holdings s.a.s  
Nufarm Hong Kong Investments Ltd 
Nufarm Hungaria Kft  
Nufarm Inc.  
Nufarm Industria Quimica e Farmaceutica SA  
Nufarm Insurance Pte Ltd 
Nufarm Investments Cooperatie WA (b) 
Nufarm Italia srl  
Nufarm KK 
Nufarm Labuan Pte Ltd  
Nufarm Limited  
Nufarm Malaysia Sdn Bhd  
Nufarm Materials Limited  
Nufarm NZ Limited  
Nufarm Peru SAC 
Nufarm Platte Pty Ltd 
Nufarm Portugal LDA  
Nufarm Romania SRL  
Nufarm s.a.s  
Nufarm SA  
Nufarm Suisse Sarl  
Nufarm Technologies (M) Sdn Bhd 

Notes 

(a),(b) 
(b) 

(b) 
(b) 
(b) 

(b) 

(b) 
(b) 
(b) 
(b) 
(b) 

(b) 
(b) 
(b) 

(b) 
(b) 
(b) 

(b) 

(b) 
(b) 
(b) 
(a),(b) 
(b) 

(b) 
(b) 
(b) 
(b) 
(b) 

Place of 
incorporation 

Malaysia 
Australia 
Netherlands 
Canada 
China 
Chile 
Colombia 
United Kingdom 
Costa Rica 
Guatemala 
Mexico 
Panama 
Venezuela 
Ecuador 
Germany 
Brazil 
Spain 
New Zealand 
Austria 
Austria 
Germany 
Mexico 
New Zealand 
Netherlands 
France 
Hong Kong 
Hungary 
US 
Brazil 
Singapore 
Netherlands 
Italy 
Japan 
Malaysia 
United Kingdom 
Malaysia 
Australia 
New Zealand 
Peru 
Australia 
Portugal 
Romania 
France 
Argentina 
Switzerland 
Malaysia 

Percentage
of shares held

2010 

2009

100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
– 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
51 

100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
– 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
51 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

100

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

35. Group entities (continued)

Nufarm Technologies USA 
Nufarm Technologies USA Pty Ltd 
Nufarm Treasury Pty Ltd  
Nufarm UK Limited  
Nufarm Ukraine LLC 
Nufarm USA Inc 
Nugrain Pty Ltd 
Nuseed Americas Inc 
Nuseed Holding Company 
Nuseed Pty Ltd 
Nuseed SA 
Nutrihealth Grains Pty Ltd 
Nutrihealth Pty Ltd 
Opti-Crop Systems Pty Ltd  
Pharma Pacific Pty Ltd  
PT Crop Care 
PT Nufarm Indonesia  
Richardson Seeds Ltd 
Selchem Pty Ltd  

Notes 

(a),(b) 
(b) 

(b) 
(a) 

(b) 

(a) 

Place of 
incorporation 

New Zealand 
Australia 
Australia 
United Kingdom 
Ukraine 
US 
Australia 
US 
US 
Australia 
Argentina 
Australia 
Australia 
Australia 
Australia 
Indonesia 
Indonesia 
US 
Australia 

Percentage
of shares held

2010 

2009

100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
75 
100 
100 
100 
100 
100 

100 
100 
100 
100 
– 
100 
100 
– 
– 
100 
– 
100 
100 
75 
100 
100 
100 
– 
100 

Note (a). These entities have entered into a deed of cross guarantee dated 10 July 2000 with Nufarm Limited 
which provides that all parties to the deed will guarantee to each creditor payment in full of any debt of each 
company participating in the deed on winding-up of that company. As a result of a class order issued by the 
Australian Securities and Investment Commission, these companies are relieved from the requirement to  
prepare financial statements.

Note (b). These entities have entered into a deed of negative pledge dated 24 October 1996 (last amendment 
dated 30 January 2009) with group lenders which provides that all parties to the deed will guarantee to each 
creditor payment in full of any debt of each company participating in the deed.

36. Deed of cross guarantee

Under ASIC Class Order 98/1418, the Australian wholly-owned subsidiaries referred to in note 35 are relieved 
from the Corporations Act 2001 requirements for preparation, audit and lodgement of financial reports and 
directors’ reports.

It is a condition of the class order that the company and each of the subsidiaries enter into a deed of cross guarantee. 
The parent entity and all the Australian controlled entities have entered into a deed of cross guarantee dated 10 
July 2000 which provides that all parties to the deed will guarantee to each creditor payment in full of any debt  
of each company participating in the deed on winding-up of that company.

A consolidated income statement and consolidated balance sheet, comprising the company and controlled entities 
which are a party to the deed, after eliminating all transactions between parties to the deed of cross guarantee, 
at 31 July 2010 is set out as follows:

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

101

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

36. Deed of cross guarantee (continued)

Summarised income statement and retained profits
Profit before income tax expense 
Income tax expense 

Net profit attributable to members of the closed group 

Retained profits at the beginning of the period 
Amendments to the closed group 
Dividends paid 

Retained profits at the end of the period 

Statement of financial position
Current assets
Cash and cash equivalents 
Trade and other receivables 
Inventories 
Current tax assets 

Total current assets 

Non-current assets
Equity accounted investments 
Other investments 
Deferred tax assets 
Property, plant and equipment 
Intangible assets 

Total non-current assets 

TOTAL ASSETS 

Current liabilities
Trade and other payables 
Interest bearing loans and borrowings 
Employee benefits 
Current tax payable 

Total current liabilities 

Non-current liabilities
Interest bearing loans and borrowings 
Deferred tax liabilities 
Employee benefits 
Provisions 

Total non-current liabilities 

TOTAL LIABILITIES 

NET ASSETS 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

102

Consolidated

2010 
$000 

2009
$000

31,517 
(12,239) 

19,278 

267,222 
8 
(32,708) 

253,800 

87,326 
459,622 
139,347 
10,759 

697,054 

11,174 
793,934 
26,558 
160,756 
53,346 

1,045,768 

60,239 
(16,149)

44,090 

286,307 
2,122 
(65,297)

267,222 

4,326 
470,871 
192,403 
1,823 

669,423 

10,365 
588,586 
23,274 
162,553 
43,909 

828,687 

1,742,822 

1,498,110 

310,476 
4,800 
8,278 
8,497 

332,051 

47,350 
4,261 
1,952 
– 

53,563 

195,705 
105,875 
3,471 
7,130 

312,181 

32,350 
4,185 
2,863 
11,277 

50,675 

385,614 

362,856 

1,357,208 

1,135,254 

 
 
 
 
 
 
 
 
notes to the financial statements continued

36. Deed of cross guarantee (continued)

Equity
Share capital 
Reserves 
Retained earnings 

TOTAL EQUITY 

37. Parent entity disclosures

Result of the parent entity
Profit for the period 
Other comprehensive income 

Total comprehensive income for the period 

Financial position of the parent entity at year end
Current assets 

Total assets 

Current liabilities 

Total liabilities 

Total equity of the parent entity comprising of:
Share capital 
Reserves 
Retained earnings 

Total equity 

Consolidated

2010 
$000 

2009
$000

1,058,578  
44,830 
253,800 

812,844 
55,188 
267,222 

1,357,208 

1,135,254 

Company

2010 
$000 

35,993 
346 

36,339 

2009
$000

55,349 
355 

55,704 

1,053,216 

810,007 

1,382,006 

1,134,897 

112,024 

112,163 

113,633 

113,633 

1,058,578  
35,590 
175,675 

812,844 
36,027 
172,393 

1,269,843 

1,021,264 

Parent entity contingencies

There are no contingent liabilities for the parent entity in 2010 or 2009.

Parent entity capital commitments for acquisition of property, plant and equipment

There are no capital commitments for the parent entity in 2010 or 2009.

Parent entity guarantees in respect of debts of its subsidiaries

The parent entity together with all the material wholly owned controlled entities have entered into a negative 
pledge deed with the group’s lenders whereby all group entities, which are a party to the deed, have guaranteed 
repayment of all liabilities in the event that any of these companies are wound up.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

103

 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

38. Reconciliation of cash flows from operating activities

Cash flows from operating activities
Profit for the period 
Dividend from associated company 
Non-cash items:
Amortisation 
Depreciation 
Loss on sale of investment 
Gain on disposal of non current assets 
Net realisable value inventory adjustment 
Share of profits of associates net of tax 
Movement in provisions for:
Deferred tax 
Tax assets 
Exchange rate change on foreign controlled entities provisions 

Operating profit before changes in working capital and provisions 
Movements in working capital items:
(Increase)/decrease in receivables 
(Increase)/decrease in inventories 
Increase/(decrease) in payables 
Increase/(decrease) in income tax payable 
Exchange rate change on foreign controlled entities working capital items 

Net operating cash flows 

39. Key management personnel disclosures

Consolidated

2010 
$000 

(22,652) 
241 

15,455 
42,093 
– 
1,303 
– 
(47) 

(16,325) 
51,149 
(8,504) 

2009
$000

80,542 
423 

16,361 
48,412 
3,813 
(284)
67,611 
(3,080)

6,976 
(78,655)
2,511 

62,713 

144,630 

(50,450) 
256,358 
(6,664) 
(7,866) 
(59,480) 

131,898 

194,611 

58,862 
46,499 
(349,585)
11,883 
34,586 

(197,755)

(53,125)

The following were key management personnel of the consolidated entity at any time during the reporting period 
and were key management personnel for the entire period (except where denoted otherwise).

Executives 
BF Benson – Group general manager agriculture 

Non-executive directors 
DG McGauchie  
(Chairman, appointed 13 July 2010)  R Heath – Group general manager corporate services and company secretary
GDW Curlewis 
Dr RJ Edgar 
Dr WB Goodfellow 
GA Hounsell 
KM Hoggard  
(Chairman, retired 13 July 2010) 
Dr JW Stocker 

KP Martin – Chief financial officer
DA Mellody – Group general manager global marketing 
RF Ooms – Group general manager chemicals 
MJ Pointon – Group general manager innovation and development 
DA Pullan – Group general manager operations 
RG Reis – Group general manager corporate strategy and external affairs 

Executive director
DJ Rathbone – Managing director and chief executive 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

104

 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

39. Key management personnel disclosures (continued)

Key management personnel compensation

The key management personnel compensation included in personnel expenses (see note 9) are as follows:

Short term employee benefits 
Post employment benefits 
Equity compensation benefits 
Other long term benefits 

Consolidated

2010 
$ 

8,688,922 
472,036 
– 
219,630 

2009
$

6,320,665
698,981
77,250
262,368

9,380,588 

7,359,264

Individual directors and executives compensation disclosures

Information regarding individual directors and executives compensation is provided in the remuneration report 
section of the director’s report.

Apart from the details disclosed in this note, no director has entered into a material contract with the company or 
the consolidated entity since the end of the previous financial year and there were no material contracts involving 
directors’ interest existing at year-end.

Loans to key management personnel and their related parties

There were no loans to key management personnel at 31 July 2010 (2009: Nil).

Other key management personnel transactions with the Company or its controlled entities

A number of key management persons, or their related parties, hold positions in other entities that result in them 
having	control	or	significant	influence	over	the	financial	or	operating	policies	of	those	entities.	A	number	of	these	
entities transacted with the company or its subsidiaries in the reporting period. The terms and conditions of the 
transactions with management persons and their related parties were no more favourable than those available,  
or which might reasonably be expected to be available, on similar transactions to non-director related entities  
on an arms-length basis.

From time to time, key management personnel of the company or its controlled entities, or their related entities, 
may purchase goods from the group. These purchases are on the same terms and conditions as those entered 
into by other group employees or customers and are trivial or domestic in nature. 

Options and rights over equity instruments granted as compensation

No options or other equity instruments were granted to key management personnel during the current or prior 
year reporting period as compensation.

Movements in shares

The movement during the reporting period in the number of ordinary shares in Nufarm Limited held, directly, 
indirectly or beneficially, by each key management person, including their related parties, is as follows:

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

105

 
 
 
 
 
 
 
 
 
notes to the financial statements continued

39. Key management personnel disclosures (continued)

Movements in shares (continued)

Shares held in Nufarm Ltd 

2010
Directors
DG McGauchie  
(Chairman, appointed 13 July 2010)1 
DJ Rathbone 
GDW Curlewis 
Dr WB Goodfellow1,2 
Dr RJ Edgar 
KM Hoggard  
(Chairman, retired 13 July 2010)1,3 
GA Hounsell1 
Dr JW Stocker1 

Executives
BF Benson 
R Heath 
KP Martin 
DA Mellody 
RF Ooms 
MJ Pointon 
DA Pullan 
RG Reis 

Total 

Shares held in Nufarm Ltd 

2009
Directors
KM Hoggard1 
DJ Rathbone 
GDW Curlewis 
Dr WB Goodfellow1,2 
GA Hounsell1 
DG McGauchie1 
Dr JW Stocker1 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

106

Executives
BF Benson 
R Heath 
KP Martin 
DA Mellody 
RF Ooms 
MJ Pointon 
DA Pullan 
RG Reis 

Total 

Balance 
at 1 August 
2009 

Granted as 

Exercise 
remuneration  of options 

Net  Balance as  

change 
other 

at 31 July
2010

20,038 
24,162,610 
48,280 
708,018 
– 

2,383,614 
46,720 
43,780 

74,501 
215,234 
415,632 
20,966 
343,298 
17,583 
151,616 
119,315 

28,771,205 

Balance 
at 1 August 
2008 

2,383,614 
25,912,610 
44,533 
665,846 
45,170 
17,038 
41,522 

149,760 
209,001 
402,673 
16,491 
331,155 
32,756 
138,184 
128,569 

30,518,922 

– 
– 
– 
– 
– 

– 
– 
– 

– 
– 
– 
– 
– 
– 
– 
– 

– 

– 
– 
– 
– 
– 

– 
– 
– 

– 
– 
– 
– 
– 
– 
– 
– 

– 

11,201 

31,239 
(8,017,720)  16,144,890 
45,913 
1,120,551 
– 

(2,367) 
412,533 
– 

(2,383,614) 
(2,997) 
(2,259) 

– 
43,723 
41,521 

(11,339) 
(8,984) 
(21,497) 
(838) 
(9,889) 
1,634 
7,911 
(15,219) 

63,162 
206,250 
394,135 
20,128 
333,409 
19,217 
159,527 
104,096 

(10,043,444)  18,727,761 

Granted as 

Exercise 
remuneration  of options 

Net  Balance as  

change 
other 

at 31 July
2009

– 
– 
2,293 
1,550 
1,550 
– 
1,550 

12,895 
6,233 
12,895 
9,671 
12,143 
4,827 
13,432 
10,746 

89,785 

– 
– 
– 
– 
– 
– 
– 

– 
– 
– 
– 
– 
– 
– 
– 

– 

– 

2,383,614 
(1,750,000)  24,162,610 
48,280 
708,018 
46,720 
20,038 
43,780 

1,454 
40,622 
– 
3,000 
708 

(88,154) 
– 
64 
(5,196) 
– 
(20,000) 
– 
(20,000) 

74,501 
215,234 
415,632 
20,966 
343,298 
17,583 
151,616 
119,315 

(1,837,502)  28,771,205 

 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

39. Key management personnel disclosures (continued)

Movements in shares (continued)

All equity transactions with key management personnel other than those arising from the exercise of remuneration 
options have been entered into under terms and conditions no more favourable than those the entity would have 
adopted if dealing at arm’s length.

1  The shareholdings of GDW Curlewis, Dr WB Goodfellow, GA Hounsell, DG McGauchie and Dr JW Stocker include shares 
issued under the company’s non-executive director share plan and are held by Pacific Custodians Pty Ltd as trustee of the 
plan.

2  The shareholding of Dr WB Goodfellow includes his relevant interest in:

(i) 

 St Kentigern Trust Board (430,434 shares and 19,727 Nufarm Step-up Securities) – Dr Goodfellow is chairman of the 
Trust Board. Dr Goodfellow does not have a beneficial interest in these shares or Step-up Securities.

(ii)  Sulkem Company Limited (120,000 shares).

(iii)  531 Trust (400,861 shares). Dr Goodfellow and EW Preston are trustees of 531 Trust.

(iv)   Auckland Medical Research Foundation (26,558 Step-up Securities). Dr Goodfellow does not have a beneficial interest  

in these Step-up Securities.

(iv)   Trustees of the Goodfellow Foundation (33,854 shares and 1,338 Step-up Securities). Dr Goodfellow is chairman of the 

Trust Board and does not have a beneficial interest in these shares or Step-up Securities.

3  The shareholding of KM Hoggard has been removed under the net change other column due to his retirement as chairman 

on 13 July 2010.

40. Non-key management personnel disclosures

(a) Transactions with related parties in the wholly-owned group

The parent entity entered into the following transactions during the year with subsidiaries of the group:

•	 loans	were	advanced	and	repayments	received	on	short	term	intercompany	accounts;	and

•	 management	fees	were	received	from	several	wholly-owned	controlled	entities.

These transactions were undertaken on commercial terms and conditions.

(b) Transactions with associated parties

Excel Crop Care Ltd 
F&N joint ventures 

Purchases from 
Sales to 
Trade payable 
Trade receivable 

Sumitomo Chemical Company Ltd  Sales to 

Purchases from 
Trade receivable 
Trade payable 

Bayer CropScience Nufarm Limited  Sales to 

SRFA LLC 

Purchases from 
Sales to 
Commissions received 
Interest received 

Consolidated

2010 
$000 

291 
47,754 
(247) 
36,608 
1,001 
2,029 
251 
564 
– 
– 
– 
– 
– 

2009
$000

978
68,450
–
36,028 
– 
– 
– 
– 
17,069 
18,938 
3,682 
57 
3 

The Bayer CropScience equity investment and the SRFA LLC joint venture were disposed of at July 2009. 

These transactions were undertaken on commercial terms and conditions. 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

107

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
notes to the financial statements continued

41. Subsequent events 

At 31 July 2010, the group was in breach of certain covenants under the deed of negative pledge (dated 24 October 
1996), which contains the covenants and other terms common to all bankers. By 27 September 2010, the group 
obtained written waivers from all parties to the deed in respect to these covenant breaches.

In the agreements signed 27 September 2010, the parties to those agreements confirmed that any undrawn facility 
amounts are no longer available to the group. In the same agreements, the group has obtained its required funding 
through to 15 December 2010 on a secured basis, subject to certain conditions and obligations. The group is currently 
evaluating its options regarding the nature and terms of a new financing facility beyond 15 December 2010.

Consolidated

2010 
$000 

2009
$000

469 

409 

1,143 
212 

1,824 

150 

1,974 

69 

27 

96 

947 
286 

1,642 

122 

1,764 

15 

48 

63 

Refer to note 2(b) for further details.

42. Auditors’ remuneration

Audit services
KPMG Australia
Audit and review of group financial report 

Overseas KPMG firms
Audit and review of group financial report 
Audit and review of local statutory reports 

Other auditors
Audit and review of financial reports   

Audit services remuneration 

Other services
KPMG Australia
Transaction due diligence services 
Overseas KPMG firms
Other assurance services 

Other services remuneration 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

108

 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
 
directors’ declaration

1. In the opinion of the directors of Nufarm Limited (the company):

(a)   the consolidated financial statements and notes, and the remuneration report in the directors’ report, are 

in accordance with the Corporations Act 2001 including:

(i)   giving a true and fair view of the group’s financial position as at 31 July 2010 and of its performance, 

for the financial year ended on that date; and 

(ii)  complying with Australian Accounting Standards (including the Australian Accounting Interpretations) 

and the Corporations Regulations 2001; and 

(b)   there are reasonable grounds to believe that the company will be able to pay its debts as and when they 

become due and payable.

2.  There are reasonable grounds to believe that the company and the group entities identified in note 36 will  

be able to meet any obligations or liabilities to which they are or may become subject to by virtue of the deed  
of cross guarantee between the company and those group entities pursuant to ASIC Class Order 98/1418.

3.  The directors have been given the declarations required by section 295A of the Corporations Act 2001 from 

the chief executive officer and chief financial officer for the financial year ended 31 July 2010.

4.  The directors draw attention to note 2 to the consolidated financial statements, which includes a statement  

of compliance with International Financial Reporting Standards.

Signed in accordance with a resolution of the directors: 

Dated at Melbourne this 28th day of September 2010 

DM McGauchie 
Director 

DJ Rathbone 
Director 

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

109

 
 
 
 
 
 
 
 
 
 
 
independent auditor’s report 
to the members of Nufarm Limited

Report on the financial report

We have audited the accompanying financial report of the Group comprising Nufarm Limited (the Company)  
and the entities it controlled at the year’s end or from time to time during the financial year, which comprises the 
consolidated balance sheet as at 31 July 2010, and consolidated income statement and consolidated statement 
of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash 
flows	for	the	year	ended	on	that	date,	a	summary	of	significant	accounting	policies	and	other	explanatory	 
notes 1 to 42 and the directors’ declaration.

Directors’ responsibility for the financial report 

The directors of the company are responsible for the preparation and fair presentation of the financial report in 
accordance with Australian Accounting Standards (including the Australian Accounting Interpretations) and the 
Corporations Act 2001. This responsibility includes establishing and maintaining internal control relevant to the 
preparation and fair presentation of the financial report that is free from material misstatement, whether due to 
fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are 
reasonable in the circumstances. In note 2(a), the directors also state, in accordance with Australian Accounting 
Standard AASB 101 Presentation of Financial Statements, that the financial report, comprising the financial 
statements and notes, complies with International Financial Reporting Standards.

Auditor’s responsibility

Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in 
accordance with Australian Auditing Standards. These Auditing Standards require that we comply with relevant 
ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance 
whether the financial report is free from material misstatement. 

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the 
financial report. The procedures selected depend on the auditor’s judgement, including the assessment of the 
risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, 
the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial report 
in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing 
an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness 
of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as 
evaluating the overall presentation of the financial report. 

We performed the procedures to assess whether in all material respects the financial report presents fairly,  
in accordance with the Corporations Act 2001 and Australian Accounting Standards (including the Australian 
Accounting Interpretations), a view which is consistent with our understanding of the Group’s financial position 
and of its performance. 

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit 
opinion.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

110

 
 
 
 
 
independent auditor’s report continued
to the members of Nufarm Limited

Independence

In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001. 

Auditor’s opinion

In our opinion:

(a)  the financial report of the Group is in accordance with the Corporations Act 2001, including: 

(i)   giving a true and fair view of the Group’s financial position as at 31 July 2010 and of its performance  

for the year ended on that date; and 

(ii)   complying with Australian Accounting Standards (including the Australian Accounting Interpretations)  

and the Corporations Regulations 2001.

(b)  the financial report also complies with International Financial Reporting Standards as disclosed in note 2(a). 

Material uncertainty regarding group debt refinancing

Without qualification to the opinion set out above, we draw attention to note 2(b) in the financial report which 
details the status and terms of the Group’s debt financing arrangements.

As a consequence of breaching certain debt covenant requirements at 31 July 2010, the Group has subsequently 
obtained written confirmation from its lenders that rights to call for immediate repayment of amounts outstanding 
will be waived until 15 December 2010, by which time the Group expects to secure a revised longer term financing 
arrangement under new terms and conditions. As part of providing waivers certain lenders to the Group have agreed 
to provide short term funding to 15 December 2010 pursuant to agreements entered into on 27 September 2010. 
The provision of such funding and/or continuation of waivers is subject to a number of conditions and obligations 
as set out in the agreements, the details of which are set out in note 2(b). 

The ability of the Group to meet the conditions and obligations as set out in the agreements, and to secure a longer 
term revised debt financing arrangement by 15 December 2010 on mutually acceptable terms and conditions, 
cannot presently be determined with certainty. These conditions, along with other matters as set out in note 2(b), 
indicate the existence of a material uncertainty which may cast significant doubt over the Group’s ability to continue 
as a going concern, and therefore, whether it will realise its assets and extinguish its liabilities at the amounts 
stated in the financial report.

Material uncertainty regarding revenue recognised and valuation of accounts receivable relating  
to a claim made on a supplier

Without qualification to the opinion expressed above, attention is drawn to the following matter. As stated in  
note 2(d)(vi), the Group and a major supplier are in dispute relating to liability for a share of losses pursuant to 
 an Exclusive Distribution Agreement. During the year the Group recorded an additional receivable of $12.8 million 
in relation to these losses and as at 31 July 2010 has recorded a total receivable owing by the supplier in relation 
to these losses of $52.7 million (31 July 2009: $39.9 million). The matter is the subject of a commercial dispute 
between the parties and is currently subject to arbitration proceedings, the outcome of which cannot be predicted 
with certainty. No provision has been made for any shortfall in recovery of the amount.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

111

 
 
 
 
 
 
 
 
independent auditor’s report continued
to the members of Nufarm Limited

Report on the remuneration report

We have audited the remuneration report included under the heading ‘remuneration report’ in the directors’ 
report for the year ended 31 July 2010. The directors of the company are responsible for the preparation and 
presentation of the remuneration report in accordance with Section 300A of the Corporations Act 2001. Our 
responsibility is to express an opinion on the remuneration report, based on our audit conducted in accordance 
with auditing standards.

Auditor’s opinion

In our opinion, the remuneration report of Nufarm Limited for the year ended 31 July 2010, complies with Section 
300A of the Corporations Act 2001.

KPMG

BW Szentirmay 
Partner

Melbourne
28 September 2010

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

112

 
 
 
 
 
shareholder and statutory information

Details of shareholders, shareholdings and top 20 shareholders

Listed securities – 28 September 2010 

Number 
of holders 

Number 
of securities 

Percentage held
by top 20

Fully paid ordinary shares 

16,733 

261,775,731 

74.12

Twenty largest shareholders 

Sumitomo Chemical Company 

HSBC Custody Nominees (Australia) Limited 

National Nominees Limited 

JP Morgan Nominees Australia Limited 

Falls Creek No 2 Pty Ltd 

Amalgamated Dairies Limited 

Citicorp Nominees Pty Limited 

Challenge Investment Company Limited 

ANZ Nominees Limited  

Woodross Nominees Pty Ltd 

Mr Edgar William Preston & Mr Paul Gerard Keeling   

JP Morgan Nominees Australia Limited 

Cogent Nominees Pty Limited 

RAM Custodian Limited & GBH Trustee Services Limited 

HSBC Custody Nominees (Australia) Limited – A/C 2 

HSBC Custody Nominees (Australia) Limited – GSCO ECA 

Pacific Custodians Pty Ltd  

Australian Reward Investment Alliance 

Douglas Industries Limited 

CPU Share Plans Pty Ltd  

Distribution of shareholders 

Size of holding

1  – 1,000 
  1,001  – 5,000 
  5,001  – 10,000 
  10,001  – 100,000 
 100,001  and over 

Ordinary 
shares as at 
28.09.10 

52,355,146 

36,193,532 

21,675,117 

18,040,384 

15,216,590 

14,330,798 

9,877,116 

3,130,282 

3,070,948 

2,888,311 

2,364.282 

2,293,341 

1,979,477 

1,900,000 

1,794,090 

1,765,169 

1,430,652 

1,391,942 

1,170,866 

1,161,310 

Percentage of
issued capital
as at 28.09.10

20.00

13.83

8.28

6.89

5.81

5.47

3.77

1.20

1.17

1.10

0.90

0.88

0.76

0.73

0.69

0.67

0.55

0.53

0.45

0.44

Number of 
holders as at 
28.09.10 

Ordinary
shares held
as at 28.09.10

7,165 
7,296 
1,358 
833 
81 

3,501,754
17,531,228
9,729,909
17,921,155
213,091,685

Of these, 1,146 shareholders held less than a marketable parcel of shares of $500 worth of shares (127 shares). 
In accordance with the ASX Listing Rules, the last sale price of the company’s shares on the ASX on 28 September 
2010 was used to determine the number of shares in a marketable parcel.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

113

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
shareholder and statutory information continued

Stock exchanges on which securities are listed

Ordinary shares: Australian Securities Exchange Limited.

Substantial shareholders

In accordance with section 671B of the Corporations Act, as at 28 September 2010, the substantial shareholders 
set out below have notified the company of their respective relevant interest in voting shares in the company 
shown adjacent to their respective names as follows:

Number and percentage of shares in which interest held at date of notice

Sumitomo Chemical Company 
Nufarm Limited1 
Douglas John Rathbone 
Amalgamated Dairies Ltd 
Khyber Pass Investments Ltd2 
Glade Buildings Ltd3 
Hauraki Trading Co. Ltd4 
PG Keeling & EW Preston (Oxford Trustees)5 

Date of notice 

27 May 2010 
28 May 2010 
28 May 2010 
31 May 2010 
31 May 2010 
31 May 2010 
31 May 2010 
31 May 2010 

Number 

52,350,412 
52,350,412 
16,142,890 
14,330,798 
14,349,658 
14,692,730 
14,679,639 
14,711,590 

Interest %

19.998
19.998
6.17
5.47
5.48
5.61
5.61
5.62

1 

2 

3 

4 

5 

 Nufarm Limited has a relevant interest in the shares held by Sumitomo Chemical Company. The relevant interest arises 
under a shareholder deed dated 22 January 2010 between Nufarm and Sumitomo which contains certain obligations  
relating to the voting and disposal of shares in Nufarm by Sumitomo.

 Khyber Pass Ltd has a relevant interest in Amalgamated Dairies Ltd and, as a result, the number of shares disclosed  
by it includes the shares held by Amalgamated Dairies Ltd.

 Glade Building Ltd has a relevant interest in Amalgamated Dairies Ltd and, as a result, the number of shares disclosed  
by it includes the shares held by Amalgamated Dairies Ltd.

 Hauraki Trading Ltd has a relevant interest in Amalgamated Dairies Ltd and, as a result, the number of shares disclosed  
by it includes the shares held by Amalgamated Dairies Ltd.

 Oxford Trustees has a relevant interest in Glade Building Ltd, Khyber Pass Ltd and Amalgamated Dairies Ltd and, as a result,  
the number of shares disclosed by it includes the shares held by Glade Building Ltd, Khyber Pass Ltd and Amalgamated 
Dairies Ltd.

Voting rights

On a show of hands, every shareholder present in person or represented by a proxy or representative shall have 
one vote and on a poll every shareholder who is present in person or represented by a proxy or representative 
shall have one vote for every fully paid share held by the shareholder.

Shareholder information

Annual general meeting

The annual general meeting of Nufarm Limited will be held on Thursday 2 December 2010 at 10.00am in Bayside 
Rooms 5 and 6, Level 2, RACV Club, 501 Bourke Street, Melbourne, Victoria. Full details are contained in the 
notice of meeting sent to all shareholders.

Voting rights

Shareholders are encouraged to attend the annual general meeting. However, when this is not possible, they are
encouraged to use the form of proxy by which they can express their views. Proxy voting can be completed online 
via www.nufarm.com/annualgeneralmeeting or via post by completing the proxy form and sending it back in the
return envelope.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

114

 
 
 
 
 
 
 
shareholder and statutory information continued

Every shareholder, proxy or shareholder’s representative has one vote on a show of hands. In the case of a poll,
each share held by every shareholder, proxy or representative is entitled to:

(a)  one vote for each fully paid share; and

(b)  voting rights in proportion to the paid up amount of the issue price for partly paid shares.

Stock exchange listing

Nufarm shares are listed under the symbol NUF on the ASX. The securities of the company are traded on the 
ASX under CHESS (Clearing House Electronic Sub-register System), which allows settlement of on-market 
transactions without having to reply on paper documentation.

Shareholders seeking more information about CHESS should contact their stockbroker or the ASX.

Shareholder details

The Nufarm Limited Share Register is managed by Computershare Investor Services. Investors can gain access 
to shareholding information in the following ways:

Online via Investor Centre

Step 1  Go to www.computershare.com/au/investors
Step 2  Select ‘Holding Enquiry’
Step 3  Enter NUF or Nufarm Limited
Step 4 

 Enter your Securityholder Reference Number (SRN) or Holder Identification Number (HIN), postcode or 
country if outside Australia

Step 5  Enter the security code that appears and agree to the terms and conditions
Step 6  Select ‘Submit’

Alternatively, manage your portfolio by becoming a member of Investor Centre and register for a username and 
password at www.computershare.com/au/investors

By telephone via InvestorPhone

InvestorPhone provides telephone access 24 hours a day seven days a week.

Step 1 

 Call the Nufarm shareholder information line on 1300 652 479 (within Australia) or +61 3 9415 4360 
(outside Australia).

Step 2  Follow the prompts to gain secure, immediate access to your:

– holding details
– registration details
– payment information

Shareholder communications

Investors can choose to receive shareholder communications electronically. Register for this initiative  
at www.eTree.com.au/nufarm and a donation of $1 will go to Landcare to support urgent reforestation  
projects in Australia and New Zealand.

The default for receiving the annual report is now via the company’s website – www.nufarm.com

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

115

 
 
 
 
 
 
 
 
shareholder and statutory information continued

Shareholder enquiries

Contact:

Computershare Investor Services
Yarra Falls, 452 Johnston Street 
Abbotsford Victoria 3067
GPO Box 2975 
Melbourne Victoria 3001

Telephone:  1300 652 479 (within Australia)

+61 3 9415 4360 (outside Australia)

Email: web.queries@computershare.com.au

Dividends

No final dividend will be paid.

Key dates

27 October 2010*  Annual report sent to shareholders
2 December 2010  Annual general meeting
28 March 2011* 
31 July 2011 

Announcement of profit result for half year ending 31 January 2011
End of financial year

* Subject to confirmation.

For enquiries relating to the operations of the company, please contact the Nufarm Corporate Affairs Office on:

Telephone: (61) 3 9282 1177
Facsimile: (61) 3 9282 1111
Email: robert.reis@au.nufarm.com

Written correspondence should be directed to:

Corporate Affairs Office
Nufarm Limited
PO Box 103
Laverton Victoria 3028 Australia

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

116

 
 
 
 
 
 
directory

Directors

Share registrar

DG McGauchie AO – Chairman
GDW Curlewis – Deputy chairman
DJ Rathbone AM – Managing director
Dr RJ Edgar
Dr WB Goodfellow
GA Hounsell
Dr JW Stocker AO

Company secretary

R Heath

Solicitors

Arnold Bloch Leibler & Co
333 Collins Street
Melbourne Victoria 3000 Australia

Sylvia Miller & Associates
131 Orrong Road
Elsternwick Victoria 3185 Australia

Auditors

KPMG
147 Collins Street
Melbourne Victoria 3000 Australia

Trustee for Nufarm Step-up Securities

Permanent Trustee Company Ltd
35 Clarence Street
Sydney NSW 2000 Australia

Australia
Computershare Investor Services Pty Ltd
GPO Box 2975EE
Melbourne Victoria 3001 Australia
Telephone: 1300 850 505
Outside Australia: 61 3 9415 4000

Step-up Securities registrar

New Zealand
Computershare Registry Services Limited
Private Bag 92119
Auckland New Zealand 1020
Telephone: 64 9 488 8700

Registered office

103–105 Pipe Road
Laverton North Victoria 3026 Australia
Telephone: 61 3 9282 1000
Facsimile: 61 3 9282 1001

NZ branch office

6 Manu Street
Otahuhu Auckland New Zealand
Telephone: 64 9 270 4157
Facsimile: 64 9 267 8444

Website

http://www.nufarm.com

Nufarm Limited
ACN 091 323 312

Produced by Gillian Sweetland. Designed by MDM Design.

0
1
0
2

t
r
o
p
e
R

l

a
u
n
n
A
–

d
e
t
i

i

m
L
m
r
a
f
u
N

117