REG - Genus - AGM Trading Update

GenusAnnouncement

22/11/2023 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20231122:nRSV1877Ua&default-theme=true

RNS Number : 1877U  Genus PLC  22 November 2023

22 November 2023

Genus plc

AGM Trading Update

("Genus" or the "Group")

Genus (LSE: GNS), a leading global animal genetics company, publishes the
following trading update for the period from 1 July 2023 to 21 November 2023,
to coincide with its AGM at 11:00am GMT this morning.

The Board remains confident that Genus will continue delivering against its
strategic growth drivers despite trading in the period under review being
mixed. Group adjusted profit before tax is currently expected to be in-line
with market expectations(1) for the financial year 2024, with phasing expected
to be second-half weighted.

PIC trading in the period has been robust with year-on-year growth in both
volumes and royalty revenues. In North America, PIC's high proportion of
royalty revenue has meant the business has been relatively insulated from
producer losses caused by low pig prices. Latin America and Europe have also
performed well with adjusted operating profit(2) up on the prior year. Pig
prices in China continue to be depressed and the majority of producers in
China are loss-making. This compares with a relatively strong period for
Chinese pork prices in the equivalent period last year. Against this strong
comparator, PIC Asia's adjusted operating profit(2) was lower than the prior
year. However, we are making good strategic progress in demonstrating the
value of PIC's genetics to major producers via trials, in a market that is
becoming more technified.

ABS has had a challenging start to the year with lower year-on-year volumes
being partially offset by improvements in prices and mix. Weaker global milk
prices, particularly in China, have resulted in a reduction in the national
dairy herd and contributed to lower producer demand for genetics. Beef demand
in Brazil has also continued to be weak, driven by macroeconomic pressures on
consumer demand. The tough market backdrop has meant that ABS's adjusted
operating profit(2) in the period was lower than the prior year. There are
significant operational improvements underway within ABS which we expect to
drive improved adjusted operating profit(2) performance for the full year.

As anticipated, R&D costs(2) in the period were higher year-on-year,
reflecting the annualised operating cost impact of Atlas, PIC's new nucleus
farm, and expenditure in relation to PRRS* Resistant Pig ("PRP")
commercialisation. A capital markets event on 1 November 2023 also provided a
further update on the Group's pioneering PRP programme and its path to
commercialisation(3). Progress continues in-line with the pathway discussed
during the event with anticipated receipt of US FDA approval in the first half
of 2024. On 5 October 2023, the Group was also pleased to announce that the
government of Colombia gave a favourable regulatory determination for PRP,
enabling the future sale of such pigs in Colombia.

Genus will announce its interim results for the six month period 1 July 2023
to 31 December 2023 on 22 February 2024.

For further information please contact:

Genus plc            Tel: +44 (0)1256 345 970

Jorgen Kokke, Chief Executive Officer

Alison Henriksen, Chief Financial Officer

Anand Date, Investor Relations Director

Buchanan            Tel: +44 (0)207 466 5000

Charles Ryland; Chris Lane; Sophie Wills; Verity Parker

About Genus

Genus is a world-leading animal genetics company. 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's 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.

* Porcine Reproductive and Respiratory Syndrome virus

1 Group compiled consensus estimate for FY24 actual adjusted profit before tax
is £73.0m and is based upon the average of 6 analyst estimates that were
collated on or around 3 November 2023

2 Adjusted operating profit / costs in constant currency

3 Event slides and a webcast recording are available at
https://www.genusplc.com/investors/results-reports-and-presentations/
(https://www.genusplc.com/investors/results-reports-and-presentations/)

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTFELFMFEDSELF