Origin Enterprises confirms ‘challenging year’ in financial results

Agri-services group Origin Enterprises has confirmed a “challenging year” in its financial results for the financial year ending July 2020 (FY20).

The company said that this was down to Covid-19, as well as reduced demand for agronomy services.

The group’s results were released today (Wednesday, September 23).

The group’s revenue decreased by 11.6% to around €1.6 billion, and decreased on an underlying basis by 11.7%.

Meanwhile, operating profit for FY20 stood at €44.1 million, a decrease of 46.4% (44.6% on an underlying basis).

The group had an operating margin of 2.8% in FY20, compared to a margin of 4.6% for the 2019 financial year (FY2019).

Origin saw strong cash generation with free cash-flow of €64.3 million, compared to €54 million to the previous year.

Net debt was reduced to €53.2 million, compared to €75.6 million the previous year, while working capital inflow stood at €30.3 million, compared to a FY19 outflow of €12.7 million.

In light of market conditions and uncertainty relating to Covid-19, in June 2020 the board of Origin decided to suspend the final dividend for FY20. As a result, the total dividend for the year was 3.15c per share, following the payment of the interim dividend in April 2020.

Commenting on the results, Origin’s CEO Sean Coyle said: “FY20 was a challenging year for the group, with prolonged unseasonal weather conditions, particularly in the UK and Ireland, reducing demand for agronomy services and crop input investment spend.

“With the possibility of Brexit without a trade deal on December 31, 2020, and the ongoing Covid-19 pandemic, FY21 will bring challenges for our business. Consequently, we will continue to implement our prudent risk management approach and capital allocation strategy,” Coyle added.

New appointment

Also today, Origin announced the appointment of TJ Kelly as its new chief financial officer. He will join up with the group in March 2021, and will be appointed as an executive director.