The Board of Directors reported at Wynnstay’s Annual General Meeting on March 22, 2022, that trading in the first four months of the new financial year was in line with management expectations across core activities, while fertiliser operations at Glasson continued to see significant one-off gains.
This was due to dramatically rising fertiliser commodity prices, which were triggered by huge increases in the global price of natural gas, which is required to make ammonium nitrate fertiliser for the agricultural and specialist merchanting group.
Fertiliser commodity prices have remained exceptionally high since then, reflecting the implications of the ongoing war in Ukraine, especially the disruption of Russian supply said Wynnstay.
As a result, the Board now anticipates the group’s pre-tax profits to exceed current market estimates for the fiscal year ending in October 2022.
Commodity price inflation will raise group revenue across all activities, including feed, but it should be emphasised that the group’s absolute unit margin model means that group operating profit will not gain proportionally.
Interim results are likely to be released at the end of June or early July, along with a trading update from the Board.
Wynnstay shares have dropped 1% to 600p despite the company stating that trading is in line with expectations.