Origin Enterprises Reports 17% Operating Profit Growth in H1 2025
Why we think this is good
Origin Enterprises has demonstrated resilience and growth in key financial metrics for H1 2025. The company reported a 17.1% increase in operating profit to €14.9 million and a substantial 37.8% rise in adjusted EPS to 5.17 cent. While group revenue slightly decreased by 2.7%, this was primarily due to lower global feed and fertiliser prices, with underlying volume growth of 3% excluding crop marketing. The company's Living Landscapes segment showed strong performance, and the Agriculture segment recovered volumes in Q2. The secured €440 million sustainability-linked credit facility enhances liquidity and financial flexibility. However, the increased net bank debt and high valuation based on revenue-to-market cap ratio warrant some caution. The outlook appears cautiously optimistic with strong demand in key areas, although full-year guidance is not provided due to the seasonal nature of the business.
Key Points
- Operating profit up 17.1% to €14.9 million
- Adjusted EPS increased 37.8% to 5.17 cent
- Group revenue down 2.7% to €831.7 million due to lower commodity prices
- Underlying volume growth of 3% (excluding crop marketing)
- Living Landscapes segment showed strong performance
- Agriculture segment recovered volumes in Q2
- New €440 million sustainability-linked credit facility secured
- Completed €20 million share buyback programme
- Strong demand in animal nutrition and soil nutrition businesses
- No full-year guidance provided due to seasonal nature of business
Summary
Origin Enterprises plc reported a strong first half performance for the period ended 31 January 2025. Key highlights include:
- Operating profit increased by 17.1% to €14.9 million
- Adjusted EPS grew by 37.8% to 5.17 cent
- Group revenue decreased by 2.7% to €831.7 million, primarily due to lower global feed and fertiliser prices
- Underlying volume growth of 3% (excluding crop marketing)
- Living Landscapes segment delivered €2.3 million of operating profit growth
- New €440 million sustainability-linked credit facility secured
- Completed €20 million share buyback programme
The company noted strong demand in order volumes for animal nutrition and soil nutrition businesses for the remainder of the year. However, due to the significant levels of spring volumes yet to be delivered, Origin has not issued guidance for the full year 2025. The broker consensus remains positive, with Shore Capital reiterating a 'Buy' recommendation.