Delta and Pine Land
warned that its 2002 profits and revenue would be below previous guidance as cotton acreage planted in the United States is expected to decrease this year.
The commercial breeder, producer, and marketer of cotton planting seed said on Thursday that it now expects to see 2002 earnings per share of 81 cents to 87 cents, excluding a 5 cent a share charge related to legal expenses. The company had previously forecast $1.05 to $1.12 a share, and analysts polled by Thomson Financial/First Call were expecting 96 cents.
Delta and Pine said revenue will also be lower than previously expected, coming in at $255 million to $270 million for the year, well below previous forecasts of $310 million to $325 million. Wall Street had been looking for $314.5 million.
In a press release, the company said its results would be impacted by a lower number of acres of cotton planted as well as a change in a product mix. Delta believes low commodity prices have stimulated cotton growers to use cost cutting measures, shifting Delta's sales to lower margin products.
The company also said it believes new farm legislation will provide opportunities for increased income, but passage of the farm bill came too late to altar cropping plans fro 2002.
Shares of DLP closed at $20.66 Thursday before the revised outlook.