Australian farm chemicals manufacturer Nufarm (NUF.AX) is still confident it can record higher profits after its sales performance hit new lows in its key subsidiaries.

Nufarm, which partly owned by Japan's Sumitomo Chemical, was affected by a slack in sales of its key product, glyphosate, to buyer Monsanto and top markets in Europe and North America were grappling with a late cold winter, thus a delayed planting season.

In a disclosure to the ASX, Nufarm said its net profit before one-off items dropped to A$58.6 million ($56.2 million) for the year to July 31, 2010, from A$159.6 million a year earlier.

This was at the low end of its targeted net operating profits estimated before between A$55 million and A$65 million and failing analysts' expectations of around A$62 million, according to data from Thomson Reuters I/B/E/S.

The company early this week signed some new debt covenants with its creditors and was given more time to meet its debt obligations due this year. Liabilities now amounts to A$620 million as of July 31.

, which put it in breach of two of its debt covenants. Its bankers this week agreed to waive those covenants on loans due this year, giving Nufarm time to review its strategy and refinance its debt.

In a related statement, Nufarm said the agreement reached with creditors does not only include targets as to how its obligations will be paid, but it is hinged on some satisfactory performance milestones placed in parallel with some interim milestones set by the company to ensure that it remains viable over the long term.

The company also disclosed that it would not be paying out regular dividends to shareholders for fiscal year 2010. It would instead pay off its so-called Nufarm Step-Up Securities it issued recently.