Genus PLC AGM Trading Update (3286T)
24 November 2021 - 05:59PM
UK Regulatory
TIDMGNS
RNS Number : 3286T
Genus PLC
24 November 2021
Immediate release 24 November 2021
Genus plc
('Genus' or the 'Group')
AGM TRADING UPDATE
Genus (LSE: GNS) , a leading global animal genetics company,
publishes the following trading update for the period from 1 July
2021 to 23 November 2021, to coincide with its AGM at 11:00am GMT
this morning.
As anticipated in the Preliminary Results announcement in
September, trading in the period under review in both Genus's
bovine and porcine businesses made continued progress and the Group
met profit expectations except in PIC China, which continues to
face challenging market conditions. Net debt of the Group at the
end of October 2021 was in line with expectations. Additionally,
Genus continued to make good progress towards its strategic
objectives with significant investments in R&D and capital
projects supporting the long-term growth of the Group as
planned.
In the four months to 31 October 2021, PIC's volumes were lower
than the prior year due to the downturn in China, while royalty
revenues showed continued growth, and PIC achieved revenue growth
overall. In the period ABS also achieved continued volume and
revenue growth.
Since September there has been significant volatility in the
Chinese porcine market, with the live pig price falling from 20
RMB/kg to a low of 10 RMB/kg in early October and it is currently
approximately 17 RMB/kg. At these prices producers have been
unprofitable, and consequently have sought to reduce their sow
inventory. PIC China's customers have postponed stocking orders and
reduced their sow herd numbers significantly. We anticipate this
inventory will need to be replaced when the market recovers and
believe the current market circumstances will accelerate further
the consolidation of production over time, increasing the medium
and long-term opportunity for PIC's elite genetics.
Outlook
Whilst pig prices have improved in China in the past month,
prices need to improve further and be sustained for producer
confidence to return and lead to improved demand for porcine
genetics. Looking to FY23 the Group remains positive as to the
medium-term growth prospects of PIC China and is continuing to
invest in the local supply chain to be well positioned to capture
this growth opportunity.
Based on the first four month's trading trends in PIC China and
its latest interactions with its customers, the Board currently
anticipates that the Group's profit before tax is likely to be
moderately lower than its previous expectation for the financial
year 2022. However, we remain confident in the Group's strategy and
the many opportunities for Genus.
For further information please contact:
Genus plc Tel: 01256 345970
Stephen Wilson, Chief Executive Officer
Alison Henriksen, Chief Financial Officer
Buchanan Tel: 0207 466 5000
Charles Ryland /Chris Lane/Vicky Hayns
This announcement is available on the Genus website
www.genusplc.com
About Genus
Genus creates advances to animal breeding and genetic
improvement by applying biotechnology and sells added value
products for livestock farming and food producers. Its technology
is applicable across livestock species and is currently
commercialised by Genus in the dairy, beef and pork food production
sectors.
Genus' worldwide sales are made in over seventy-five countries
under the trademarks 'ABS' (dairy and beef cattle) and 'PIC' (pigs)
and comprise semen, embryos and breeding animals with superior
genetics to those animals currently in farms. Genus's customers'
animals produce offspring with greater production efficiency, and
quality, and use these to supply the global dairy and meat supply
chains.
The Group's competitive edge has been created from the ownership
and control of proprietary lines of breeding animals, the
biotechnology used to improve them and its global supply chain,
technical service and sales and distribution network.
With headquarters in Basingstoke, United Kingdom, Genus
companies operate in over twenty-five countries on six continents,
with research laboratories located in Madison, Wisconsin, USA.
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END
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