The rebound in agricultural fortunes could have another decade to run, Genus, the livestock genetics company has said, announcing a 40% rise in full-year pre-tax profits.
Livestock farmers were on course for higher profits next year as slaughter prices reflected the rocketing costs of animal feeds. "It is expected that farmers will be returning to profitability in 2009," Genus said.
Many Western European farms, whose small size made them particularly vulnerable to higher costs, have been losing E20 per pig sold.
World food shortages, and emerging market growth, "should create a much more vibrant business environment over the next decade," the company, based in the UK, said.
With farmers seeking productivity increases which can be accelerated by genetic improvement, Genus said it viewed the market prognosis as "being increasing favourable in both the short and medium term".
The group's revenues rose by 3% to £247.1m, adjusted for currency movements and one-off effects. Sales were particularly strong in the dairy market, as farmers increased herd sizes to cash in on raised milk prices. North America remained the group's largest market, despite sales flat at £111m, with Genus's UK sales growing more than 20% to £53.4m to overtake Continental Europe.
Operating profits rose 10% to £32.4m at constant currency, excluding exceptional costs including £1.6m for the switch in its listing to London's main stock market from the Aim junior market.
Genus shares closed up 6.5p at 768.5p.
By Mike Verdin