Origin shares drop 2pc as wet summer in Britain slows growth
SHARES in Origin Enterprises dropped as much as 2pc yesterday as the agronomy business saw plantings slow amid a weak start to its new year.
In an interim management statement, the company blamed the wet summer in the UK for hindering its growth during the first quarter of its fiscal year.
In the three months to October 27, Origin said revenue increased 11.2pc to €351.2m. On an underlying basis however, revenues grew by only 3.4pc in what the company described as a "slower" start to the year.
The higher turnover was "principally driven" by higher prices, with seed and fertiliser volumes lower year-on-year, Origin added.
The first quarter is traditionally the weakest for Origin, which now does the bulk of its business in the spring – the second half of its fiscal year.
About 70pc of UK cropping has been completed, while farm management plans are being adapted to extend autumn planting where weather and soil conditions allow, along with a switch to spring 2013 cropping, the company claimed. There were "good" sales of agronomy services and seed applications.
The Polish side of the business performed "very satisfactorily".
Goodbody Stockbrokers' Liam Igoe said the numbers were as expected. "A slower performance from the UK agronomy business in the winter period was anticipated and most of the growth in full year 2013 will be generated from the integration programme within the acquired businesses in Agrii along with the improved outlook within the marine protein associate," he said.
Origin is majority owned by the Swiss baker Aryzta, whose boss Owen Killian is among the best paid Irish executives. Mr Killian stands to make €5.7m in bonuses if long-term targets are met. This year Origin boss Tom O'Mahony has been similarly well compensated. Mr O'Mahony and nearly 50 senior executives are to share a €21m bonus, an average of €420,000 each.
By the close in Dublin Origin was flat at €4.20.