Genus blames F&M for £1.2m profit fall
Genus blames F&M for £1.2m profit fall
CONSULTANCY and technology group Genus blames foot-and-mouth disease for wiping £1.2m off its year-end profits.
It expects the outbreak will continue to hit trade, depressing group profit by £1m a month until UK farming returns to normal. During April, the Crewe-based company said it could only reach 50% of its customers due to disease restrictions.
It still increased underlying pre-tax profits to £6.1m in the year ending Mar 31, 2001, up 3% on the previous year, from sales which rose 22% to £163m. After goodwill payments and exceptional charges, actual pre-tax profits dropped to £3.3m.
Genuss core breeding division was the star performer, even though half the turnover comes from UK farmers.
Sales rose by half to £71m, producing an underlying operating profit of £7.8m.
But the consulting division, largely UK-based, was hit harder by F&M. Although sales increased by 7%, underlying operating profit fell 28% to £1.1m. And the vet wholesaling business saw profit drop 68% to £0.7m due to technical and managerial problems in the autumn.
Genus chairman, John Beckett, said: "During the past four years, the world agricultural recession has continued and the UK market has suffered a temporary reversal because of F&M. Despite this, Genus has remained profitable."
The company says its new international strength will help offset the diseases impact. "The board is confident that it will be able to drive an improvement to shareholder value once the F&M crisis is over and more normal market conditions have returned," said Mr Beckett. Dividend is maintained at 4.5p a share.
The companys share price dipped 5p to 100p on Tuesday. Genus listed on the Alternative Investment Market in July 2000 at 180p. *