Underlying revenue at Origin rises despite challenges

Agri-services group Origin Enterprises said underlying revenue rose in the third quarter and maintained its full year guidance as it delivered an interim update.

The company said underlying revenue was up 0.8 per cent, despite a particularly strong comparative period in 2014 and the challenges presented by price volatility for primary producers.

Revenues in its agri-services division rose by 9.4 per cent in the third quarter, reaching €560.9 million. In the nine months to April 30th 2015, those revenues were 6 per cent higher at €1,092.5 million.

In volume terms, the business grew 0.2 per cent in the quarter. Lower feed and crop marketing volumes saw year to date volumes fall by 0.4 per cent, but the declines were partially offset by higher crop protection and fertiliser volumes. Meanwhile, input volumes, excluding crop marketing, rose by 0.6 per cent in the quarter and 2 per cent for the quarter in the year-to-date.

In the UK, Origin said its third quarter performance in its integrated on-farm agronomy services was in line with last year, as generally dry weather conditions supported activity levels on farm. In Poland, Dalgety delivered a “solid” performance, recording higher agronomy revenues and margins, while Ukraine’s Agroscope performed “resiliently”, the company said, with solid momentum across all input portfolios.

Origin said its business to business agri-inputs in Ireland and the UK achieved a satisfactory performance for the period, with higher fertiliser volumes partially offset by a lower result from feed.

Origin holds a 32 per cent shareholding in Valeo Foods, which performed in line with expectations in the third quarter, against a backdrop of highly competitive grocery markets.

Looking ahead, the company said it expected demand for services and inputs in the final quarter of the year would be lower compared with the corresponding quarter in the previous year, as pressure continued on farm incomes and seasonal intensity returned to more normal levels.