Shares in Plant Health Care (LON:PHC) withered today on news that pre-tax profits for the year are set to fall below expectations. In a trading update the crop treatment company said it had been notified by one of its key customers of lower than expected sales of its Harpin product in the current growing season resulting in an unanticipated carry-over of inventories. As a result, sales of Harpin in are expected to miss target in 2010, as a group profits. Shares in the company dipped by 33% to 116p.

Plant Health Care urged that the sales disappointment was a “onetime event” and that excess inventory would be moved through the customer's existing channels by year end and deliveries of Harpin product would realign with expectations beginning with the 2011 marketing year. “Whilst it is still early in the season and therefore difficult to forecast uptake the board considers that it would be prudent to anticipate that the level of sales into this channel in 2010 may be 50% or more below the previously expected levels,” the company said.

It insisted that the long term prospects for the channel remained as strong as previously expected and with potentially new markets available sales would recover to previously forecasted levels. The company also confirmed that discussions with other potential licencees for Harpin were continuing to progress well and that it remained confident of achieving further agreements during the year for application on other crops. Plant Health Care’s interim results are due for release in early September.

Plant Health Care specialises in developing naturally derived products for plants and soil aimed at the agriculture and landscape industries. In the year to December 2009 it posted revenues up 16.9% to $23.2m and net losses down to $1.3m from $4.3m previously.

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