■ Will hit targets
■ Assets revalued
■ Emerging markets the goal
Demand for meat in emerging markets has been a boon for semen and genetic materials specialist Genus over recent years. And that shift in demand has showed no signs of changing this year, despite a softening in some meat prices during the past quarter. Accordingly, Genus expects to hit consensus profit estimates, which currently stand at £45m.
Most markets seem to be performing well, with profitability higher, except for the US bovine market which was softer. But management says better royalty income from porcine production has more than offset this and allowed the company to invest more in research and development without affecting underlying profits. In addition, the company will book a £5m exceptional credit at the next results because of an increase in the carrying value of Genus' pedigree breeding animals to £25m, offset against a contribution of £20m toward the company pension fund. Apart from that, there was little change in strategy, with management emphasising that the push into emerging markets, particularly China, will continue apace.
Genus announces its preliminary results 4 September 2012.
