FMC Corp., a Philadelphia-based pesticide maker, saw its shares drop as much as 40% after announcing a major pricing overhaul due to persistently weak demand. CEO Pierre Brondeau cited challenging market conditions and high inventory levels of FMC products at channel customers, which are limiting sales. The company plans to significantly reduce the gap between gross and net pricing in the U.S., and lower prices in Brazil, Argentina, and Canada.
These changes will impact third-quarter revenue by an estimated $625 million to $675 million. FMC now expects an adjusted Ebitda loss of $510 million to $565 million for the quarter. The stock is down over 60% this year, and bonds maturing in 2031 saw yields spike to 10.5%.
FMC is also exploring covenant modifications with lenders and recently sold a minority stake to Tessenderlo Group for $400 million. Analysts warn the overhaul could further erode market share as competition from generic chemicals intensifies.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing