Shares crash for animal genetics firm Genus after China turbulence

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Life On A Dairy Farm The Closed Herd
Artificial insemination plays a very important role to keep the herd at a consistent number. A closed herd with no outside influence from other herds off site (apart from the introduction of a bull) the aim is that the cows have one calf per year to keep them milking and to replenish their stocks. Here Paul Wilson AI Technician from the company Genus tests each animal in the AI shed to see which is at the correct stage of its oestrus cycle and therefore requires insemination. Wildon Grange Dairy Farm, Coxwold, North Yorkshire, UK. Owned and run by the Banks family, dairy farming here is a scientific business. From the breeding, nutrition and health of their closed stock of Holstein Friesian cows, through to the end product, the team here work tirelessly, around to clock to ensure content and healthy animals, and excellent quality milk. (photo by Mike Kemp/In Pictures via Getty Images Images)

Shares crashed for animal genetics firm Genus this morning after it warned on its profits and tough market conditions.

The London-listed company said it had performed “resiliently amidst a challenging” environment, and now expects to report revenues of £334m, and adjusted profit before tax of £29m.

Following its update this morning, its shares dropped by more than 20 per cent. By midday, they were the second-biggest faller on the FTSE 250, having dropped to 1,715.00p, by 19.26 per cent, before falling 15.3 per cent down by 3pm.

The firm said its porcine division (PIC) excluding china “performed robustly”, led by the Americas and Europe. China “continues to be a challenging porcine market” however, it said.

Its other business, ABS Dairy, it said was operating in a “challenging market” and saw volumes decrease six per cent, while demand for “dairy genetics” in China was hit hard by a “double-digit decline in the dairy heard”.

Genus also said management has “taken significant action through a comprehensive global value acceleration programme that includes changes to the leadership structure, integration and simplification of ABS’s supply chains, targeted pricing initiatives and cost efficiencies.”

Looking ahead to the rest of the year, it said that “notwithstanding the management actions taken, and assuming that present market conditions persist for the balance of the fiscal year, management expects fiscal year 2024 adjusted profit before tax to be not less than £58m in actual currency.

It said results for the half year from 1 July 2023 to 31 December 2023 will be released next week.