Origin Enterprises (OGN), which delivers technical agricultural advice and systems to farmers, has had a good year, despite poor weather wreaking havoc on crop planting. And, following the disposal of two joint ventures for €110m, the group plans to return €100m to shareholders through a tender offer, representing 11 per cent of the shares outstanding.
The sale of its stakes in marine proteins and oils company Welcon and Continental Farmers leaves Origin with just one other joint venture, Valeo Foods, and is part of a strategy to focus the business on agricultural farm services. As such, more than €25m will be invested over the next three years to expand its service offering for farmers.
Meanwhile, like-for-like sales grew 4.5 per cent, but operating profit from the Farm Services division fell slightly in constant currencies to €68.9m, as strong trading in the final quarter countered lower farm activity earlier in the year, caused by poor weather. Origin's share of profit from its joint ventures grew 66 per cent to €21.8m, helped by favourable pricing at Welcon, which resulted in a 10 per cent rise in group operating profit to €90.7m, leaving underlying EPS up 15 per cent to 52.1¢.
Broker Davy expects current year pre-tax profit of €80.9m and EPS of 51¢.
| ORIGIN ENTERPRISES (OGN) | ||||
|---|---|---|---|---|
| ORD PRICE: | 665¢ | MARKET VALUE: | €884m | |
| TOUCH: | 650¢-680¢ | 12-MONTH HIGH: | 665¢ | LOW: 215¢ |
| DIVIDEND YIELD: | 2.6% | PE RATIO: | 13 | |
| NET ASSET VALUE: | 206¢* | NET DEBT: | 11% | |
| Year to 31 Jul | Turnover (€bn) | Pre-tax profit (€m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2009 | 1.51 | -75.7 | -42.7 | 8.00 |
| 2010 | 1.08 | 44.5 | 27.1 | 9.00 |
| 2011 | 1.26 | 62.5 | 36.8 | 11.0 |
| 2012 | 1.34 | 53.2 | 31.9 | 15.0 |
| 2013 | 1.42 | 81.4 | 52.8 | 17.2 |
| % change | +6 | +53 | +66 | +15 |
Ex-div: 18 Nov Payment: 2 Dec *Includes intangible assets of €129.8m, or 98¢ a share £1=€1.18 | ||||
