16th May 2023 10:22
(Alliance News) - Genus PLC on Tuesday said it expects its Chinese division to swing to a loss in the second half of the year, amid uncertainty over when porcine markets will recover.
The Basingstoke, England-based animal genetics company said it saw strong trading in its porcine business in the first four months of the second half of the year ending June 30, apart from in China where market conditions were "very challenging".
The firm said it saw an increase in operating profit in North America, Latin America and Europe during the period, while profit from Asia decreased due to the poor performance in China.
Genus said the Chinese porcine market has been weak since December last year, as a result of widespread African Swine Fever. Pig prices fell CNY14.3 per kilogram, or GBP1.63 per kilogram, from CNY15.9 per kilogram on March 2, when there were expectations of a recovery in the market.
Looking ahead, the firm said it expects a small loss in its Chinese business in the second half of the year, swinging from a profit of GBP8.8 million a year ago
"Despite this the board remains confident that due to the investments made PIC China remains well positioned to take advantage of the recovery and capture the growth opportunity as it develops, and that the group's strategy to commercialise the PRRSv-resistant pig is one of many opportunities ahead for Genus," the company said.
The firm noted that its bovine business performed better in the period, with volume and revenue growth in North America, Europe and Asia. All regions achieved operating profit growth, despite difficult trading conditions in Brazil.
Genus shares fell 4.3% to 2,457.39 pence each in London on Tuesday morning.
By Harvey Dorset, Alliance News reporter
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