Genus PLC (LSE:GNS) said full-year profit is set to beat market expectations after stronger second-half trading and cash proceeds from its Chinese porcine joint venture strengthened the animal genetics group’s balance sheet.
Adjusted profit before tax for the year ended 30 June is expected to be approximately £98 million, ahead of the company-compiled consensus range of £94.3 million to £96.9 million. The forecast includes a final £5.6 million milestone payment from Chinese partner Beijing Capital Agribusiness.
The PIC pig genetics division benefited from growth in Asia, including China, and Latin America, offsetting weaker North American trading caused by customer disease challenges. ABS, its cattle genetics business, recorded double-digit profit growth as savings from the Value Acceleration Programme countered softer demand and an adverse product mix linked to lower global dairy prices.
Genus also received about £111 million in net cash consideration from Beijing Capital Agribusiness following the formation of their Chinese porcine joint venture. Strong cash conversion and the proceeds are expected to reduce year-end net leverage to around 0.4 times.
In London, Genus shares moved up 4.23%, changing hands at 2,120p.
