MARKET REPORT: Animal breeding group Genus hit by Chinese slowdown

Nearly £230million was wiped off the value of an animal genetics company after it warned that turmoil in the Chinese pig and dairy markets will hit profits.

Ahead of its interim results next week, FTSE 250 group Genus said it could make as little as £58million in profit for the 12 months to the end of June.

Just three months ago, it said it was on course to meet the £73million pencilled in by analysts.

Shares tumbled 16.2 per cent, or 344p, to 1780p in response. That reduced the value of Genus by £227million, leaving it worth £1.2billion.

Genus sells genetically enhanced semen, embryos and breeding cattle and pigs to help farmers produce high-quality meat and milk.

Profits hit: FTSE 250 group Genus sells genetically enhanced semen, embryos and breeding cattle and pigs to help farmers produce high-quality meat and milk

Business has been disrupted in China, home to the world’s largest pork market, which has been affected by outbreaks of disease.

London’s main markets held firm even as the UK fell into recession last year.

The FTSE 100 rose 0.4 per cent, or 29.13 points, to 7597.53 and the FTSE 250 was up 0.5 per cent, or 95.73 points, to 19,099.62.

Coca-Cola HBC, the drinks bottler and seller of Fanta, Costa Coffee and Monster Energy, extended its gains yesterday following two broker upgrades.

It came a day after the company reported record profits for the third year in a row amid soaring demand. Shares, which gained 8 per cent on Wednesday, increased 2.4 per cent, or 58p, to 2440p.

Another riser was Ithaca Energy – up by 5.3 per cent, or 6.8p, to 136.2p – after the North Sea producer reported solid results for 2023 with production in line with forecasts and business costs slightly lower than expected. 

Data analytics firm Relx hiked its annual dividend following a strong year.

Stock Watch – DSW Capital

A slowdown in dealmaking after the Christmas break sent DSW Capital tumbling.

The group, which helps professionals set up their own businesses, said revenues in January and this month were lower than forecast after some M&A deals were delayed and others fell through.

It hoped to make around £1.1million to £1.4million of profit in the 12 months to the end of March but now expects between £600,000 and £700,000. Shares, which listed at 100p in 2021, fell 20.7 per cent, or 12.5p, to 48p.

The payment will rise 8 per cent to 58.8p a share after revenues rose 7 per cent to £9.2billion in 2023 while profits were up 9 per cent to £2.3billion.

Relx, which runs more than 400 events around the world, including the London Book Fair and MCM Comic Con, added that it wants to buy back £1billion of shares in 2024.

However, the stock slid 0.7 per cent, or 22p, to 3314p.

GSK completed its takeover of a clinical-stage biopharmaceutical company which is developing treatments for adult patients with severe asthma.

The blue-chip firm last month agreed to buy Aiolos in a deal worth up to £1.1billion.

The company’s shares dropped 0.3 per cent, or 5p, to 1663p.

The City was divided when it came to Kingfisher.

Analysts at Jefferies downgraded their rating on the B&Q and Screwfix owner, saying that continuing challenges in France are likely to hinder growth.

But their counterparts at Citigroup were much more optimistic, urging its clients to buy the stock, given that the retailer should benefit from a recovery in the UK housing market.

That sent Kingfisher up 3 per cent, or 6.6p, to 225.1p.

Following a tough first half, housebuilder MJ Gleeson – flat at 500p – said that there were positive signs of a recovery in demand alongside improving mortgage rates.

The group sold 125 fewer homes in the six months to the end of December, while revenues fell 11.4 per cent to £151.5million and profits by 55.3 per cent to £7.2million.

Airline and package holiday company Jet2 said that it is expecting higher annual profits as holidaymakers jet off for city breaks, take advantage of an earlier Easter and enjoy some sunshine this summer.

The group is forecasting profits of between £510million and £525million for the year to the end of March – up from £480million and £520million.

Its shares flew up 2.6 per cent, or 34p, to 1360p.

This post first appeared on Dailymail.co.uk