Genus PLC (LSE:GNS) shares trotted higher as the animal genetics company issued an encouraging statement ahead of its annual general meeting, though analysts warned that the re-election of Donald Trump and his appointment of Robert F Kennedy Jnr (RFK) as health minister is casting a shadow over the shares.
Trading in the first four months of the cattle sperm group's financial year has been "encouraging", it said.
Directors expect the group's adjusted profit before tax to be in-line with market expectations for the financial year, including an expected currency headwind of £8-9 million, which it had already previously indicated.
Trading for its PIC pig business has been "strong" with the Americas and Asia, with improved sales volumes, royalty revenue and operating profit, with Europe revenue and profit flat versus a strong prior year.
At ABS, the beef cattle business, trading improved, with good growth in sexed volumes and overall genetic volumes, with operating profit rising.
Shares in Genus rose 2.6% to 1,737.2p on Wednesday morning.
Analyst Seb Jantet at Panmure Liberum said: "There wasn’t a lot of new information in the statement but it looks like the company is making good progress in both PIC and ABS."
With the shares having fallen almost 15% since the US election, he said this was due to "the fear of tariffs and worries about RFK’s views on gene editing casting a shadow".
The analysts said he thinks there are two main concerns that investors have, the first being concerns about RFK’s stance on gene editing.
"He hasn’t said anything about gene editing in animals but he is against CRISPR and genetically modified foods so there is clearly some risk at the headline level," said Jantet in a note to clients.
"Whether this will filter down the PRRS approval remains to be seen but, in our view, the risk has increased both in terms of a further delay or the ultimate approval.
"That said, the broader Republican party is pro-agriculture and Genus’ PRP will have significant advantages for producers, so there are both pushes and pulls at play."
Second are worries over tariffs, if the Trump administration introduces tariffs, it could have an impact on Genus’ business, said Jantet.
"At this stage, there are lots of unknowns in terms of which countries, which products, the quantum of any tariffs and the reaction from other countries.
However, he said if we assume that the tariffs are aimed at China, which reacts by slapping similar tariffs on US imports, Genus has a solid supply chain for its PIC China business and "should be able to find a way round".