Shares in agri-services group Origin Enterprises were up almost 5pc in afternoon trading in Dublin on Thursday after the group reported a jump in revenue.
The Dublin-headquartered company has seen its revenue increase 42.6pc year-on-year to €454.1m in the three months to October 31.
The performance benefited from increased demand, early season forward-buying by farmers and an “encouraging” autumn-winter planting season, especially in the UK, according to a trading update from the group.
In addition, increased global fertiliser and feed prices represented approximately half of the revenue growth in the quarter. On an underlying constant currency basis, revenue increased by 44pc, reflecting an underlying volume increase of 21pc in sales of seed, crop protection and fertiliser in the period.
Origin said that “strong” crop prices globally mean that on-farm sentiment across the group's markets is positive.
The company, whose CEO is Sean Coyle, said the planted area for autumn and winter crops is expected to be broadly in line with the corresponding period for last year – with an increase in cropping area expected in the UK offset by a modest reduction in area across continental Europe.
In Latin America, the total cropping area dedicated to soya is expected to increase.
The group said the three months to October 31 – its financial first quarter – had delivered a “strong” start to the year, with increased volumes and contributions in each segment across the group, albeit when compared to a weaker corresponding period last year.
The “favourable” autumn
-winter season planting levels set a “solid foundation” for continued progress later in the company’s financial year, subject to normal weather risks which may arise.
As previously flagged by Origin, the company is “conscious” of possible operating and commercial challenges ahead regarding global supply chain risks and raw-material price volatility.
However, it added that through “continued disciplined capital deployment, and the strength and experience of the leadership team in place, we are confident in the group's ability to progress our growth ambitions successfully in [financial year 2022 ] FY22 and beyond, which will allow us to further increase shareholder returns.”
Originally founded in 1897, Origin is directly descended from the Irish Agricultural Wholesale society (IAWS), which was established to provide inputs and supplies to Irish co-operatives.
The company was set up as a standalone business in 2007 and today it employs around 2,600 people.
As well as Ireland and the UK, Origin has a presence in Brazil, Poland, Ukraine and Romania.
In September, Mr Coyle said the company can spend up to €100m on mergers and acquisitions (M&A) over the next 12 months.
The group is looking at purchasing companies similar to its landscaping business, Green-tech, in order to “continue to broaden the earnings base”, he said at the time.
In addition, the company, which reported revenue of €1.7bn during its last financial year, said it is interested in buying product-based businesses.