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Genus Shares Climb on Raised FY26 Profit Forecast and Strong Cash Flow
Summary
The British animal genetics firm boosted its full-year profit guidance, citing better-than-expected trading and robust performance in its key divisions, which significantly improved its cash position and reduced debt.
Shares in Genus plc (LSE:GNS) rose after the animal genetics company announced it expects fiscal 2026 adjusted profit before tax to be moderately ahead of market expectations, driven by stronger-than-anticipated trading in the second half of the year.
In a trading update, Genus said it anticipates full-year adjusted profit before tax of approximately £98 million, surpassing the market consensus of £95.5 million. The company noted this figure includes a final £5.6 million milestone payment from its Chinese partner, Beijing Capital Agribusiness. Genus is scheduled to release its preliminary results for fiscal 2026 on September 10, 2026.
Divisional Performance
The company attributed the upbeat outlook to solid performance across its main business units. Key highlights include:
- PIC (porcine genetics): The division delivered a strong performance, with growth in Asia and Latin America more than compensating for weaker results in North America, which faced customer disease challenges.
- ABS (bovine genetics): This unit achieved double-digit profit growth. Genus said the benefits from its Value Acceleration Programme helped offset softer customer demand and an adverse product mix resulting from lower global dairy prices.
AdBalance Sheet Strengthens
Genus also reported a significant improvement in its financial position, highlighting "very strong cash conversion" in the second half that led to substantial growth in free cash flow for the fiscal year. The company's balance sheet was further bolstered by the receipt of approximately £111 million in net cash from Beijing Capital Agribusiness following the formation of a Chinese joint venture.
As a result of the strong cash generation and proceeds from the joint venture, Genus stated its year-end net leverage will be significantly reduced to approximately 0.4x.
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