Origin revenues up 3.5% in “seasonally quiet” Q1

Agribusiness group Origin grew its revenues by 3.5 per cent in the first quarter of its 2015 financial year, although it was hit by lower global fertiliser and feed prices.

In a statement, Origin said that it achieved a “satisfactory performance” in the “seasonally quiet” first quarter of the 2015 financial year.

“While activity levels on farm were robust during the period, output price volatility is making for a demanding and challenging planning environment for primary producers currently. “

Revenues advanced by 3.5 per cent to €318 million but fell on underlying basis by 5.6 per cent, principally driven by lower global fertiliser and feed prices.

The group’s UK integrated on-farm agronomy services division performed “satisfactorily” in the period with favourable activity levels on farm supporting good demand for serviced agronomy following an early harvest. Winter oil seed rape plantings are estimated to be lower by some 10 per cent however on last year at 620,000 hectares.

In eastern Europe, the group’s Polish operation delivered a “good performance”, but in Ukraine, market conditions remain difficult, reflecting “significant political uncertainty resulting in currency weakness and a challenging operating environment”.

Business-to-business agri inputs had a positive start to the financial year, “principally supported by higher fertiliser volumes as greater visibility on raw material pricing provides confidence to customers to fix a proportion of their nutrition requirements ahead of the main application period”.

Origin's principal strategic investment, consumer foods company Valeo Foods, in which the group holds a 32 per cent shareholding, "delivered a solid performance in the period".

Looking ahead, Origin said that the autumn cropping profile established to date “provides a good foundation for the seasonally more important second half of the financial year when some 90 per cent of earnings typically arise”. The group is forecasting full year adjusted diluted earnings per share of c.60.0 cent, in line with consensus.