Origin reports a revenue increase of 4% in 6-month period

An increase in revenue of 4% has been reported by Origin Enterprises as it announced its interim results for the half year ending January 31, 2018.

Group revenue was €586.9 million compared to €564.4 million in the corresponding period last year – representing an increase of 4%.

On an underlying basis at constant currency, revenues increased by €20.3 million (3.6%) – reflecting increased agronomy service revenue and crop input volumes in addition to increased fertiliser prices, Origin outlined.

Underlying growth in agronomy services and crop input volumes, excluding crop marketing, was 1.2% in the period compared to the corresponding period last year, it added.

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Origin Enterprises is a focused agri-services group providing on-farm agronomy services, digital agricultural services as well as the supply of crop technologies and inputs.

Highlights from the interim results included:
  • Good first half performance in a seasonally quiet trading period with operating profit 12.6% higher at €2.3 million;
  • Improved working capital performance, with a working capital cash inflow of €10.7 million for the 12 months to January 31, 2018;
  • Favourable autumn and winter cropping base established for seasonally important second half;
  • Bunn Fertiliser, acquired in August 2017, fully integrated during the period;
  • Acquisition of Belgium-based fertiliser and nutrition business, Pillaert-Mekoson;
  • Digital agronomy enablement through launch of a new data-driven information service and crop monitoring tools;
  • Appointment of Rafal Prendke as CEO of the group’s Continental European Division;
  • Interim dividend of 3.15c/share (2017: 3.15c/share).

Commenting on the results, Origin CEO Tom O’Mahony said: “Origin has achieved a good first half result with favourable activity levels on farm supporting a 12.6% increase in group operating profit in the seasonally quiet trading period.

“The acquisition of Belgium-based Pillaert-Mekoson in the period scales our market position in continental Europe and provides further buy and build consolidation and growth opportunity.

“Our objectives for digital services enablement across Origin’s customer and geographic markets were significantly advanced during the period.

We continue to prioritise new growth opportunity in agri-services while focusing on cash generation, operational and commercial effectiveness.

“The autumn and winter cropping profile established to date provides a solid foundation for the seasonally more important second half, when over 90% of earnings are typically generated,” he said.

An update on the full year outlook will be provided when the third quarter trading update is announced on June 19, 2018.