Strong trading in Latin America and the Middle East and a welcome recovery in sales in Asia helped Anpario plc increase sales by 3 percent to £29m and gross profit by 7 percent to £14.5m in its results for the year ended 31 December 2019.
Anpario is a leading international producer and distributor of natural animal feed additives for animal health, nutrition and biosecurity.
“I am pleased we achieved such a solid performance in a difficult year for global agriculture markets challenged by extreme weather conditions, animal diseases and political uncertainty,” commented chief executive Richard Edwards. “We have made a sound start to trading in the current year and our strong balance sheet and cash generation provides us with the confidence that we can grow across our markets and capitalise on any opportunities which may arise.”
“We are very aware that the outbreak and subsequent spread of Covid-19 (coronavirus) is causing concerns to all industries. And, while we have not yet experienced any material impact on our business, we continue to monitor the situation within our business and with distribution and supply channels very closely. We are taking all necessary safeguards,” added Mr Edwards.
During the year, Anpario Direct’s online channel was launched in the UK to smaller farm customers as well as the equine and pigeon markets. It is the company’s intention to offer Anpario Direct in a number of other geographic markets during 2020. Also completed was the £1m investment in the automated bottling plant at Manton Wood and all previously toll-manufactured products have now been brought in-house.
Anpario’s product development activity continues with new formulations and extensive trial work with leading universities and producers. These innovations and developments highlight the company’s ambitions to deliver health, production and performance benefits too. This includes being able to reduce and replace antibiotics responsibly as part of a biosecurity solution.
“Costs continue to be managed closely and sales of our three main product ranges, phytogenics, mycotoxin binders and acid-based eubiotics, grew as product brands such as Orego-Stim, Anpro and pHorce became more widely adopted by customers,” said Richard Edwards. “Investing and developing our existing business around the world remains a priority, as does finding an earnings enhancing and complementary acquisition.”
“Anpario is at the forefront of changing attitudes to intensive farming around the world using natural ingredients,” concluded Mr Edwards. “The demand for our products is expected to continue to increase due to their effects of enhancing biosecurity, replacing non-therapeutic antibiotics and improving production efficiency which is what is now expected from consumers and farmers.”
Anpario’s Board is recommending a final dividend of 5.5 pence per share (2018: 5.0 pence) making a total of 8.0 pence per share for the year (2018: 7.2 pence), an increase of 11 percent.
Latin America delivered a very strong performance with sales growth in both Brazil and Argentina. Initial results of trials undertaken with North Carolina State University on improved egg laying performance when using Orego-Stim®, have been well received in Brazil. These indicate improved production through additional eggs per laying hen and more consistent egg sizes.
Mexico also achieved good sales growth and Anpario has developed its business in a number of other Central American countries. It has also been targeting the aquaculture market, which is beginning to exhibit some early promise following recent product registrations.
The US agriculture market has been affected by the US-China trade dispute and a poor dairy industry. Anpario’s Orego-Stim and Anpro premium brands continue to grow and Anpario is now investing in additional resource to target the swine sector. Recent extensive trials with one of the leading swine veterinary companies showed that Anpario’s phytogenic formulations support sows in delivering more pigs at weaning stage, using less feed and reducing the need for other types of antimicrobial interventions.
It was a challenging year in China given the impact of ASF. However, Anpario’s strength in the Chinese poultry market has seen positive results and the company has had success in selling its acid based eubiotic products for both broilers and layers and, in particular, pHorce which is a high strength, low inclusion acidifier on a unique carrier matrix.
South East Asia delivered a strong recovery with Thailand, Bangladesh and Taiwan experiencing the strongest performances. Anpario’s new mycotoxin binder Anpro, which has been shown to out-perform competitor products, was launched in Asia. In addition, Anpario’s new natural pellet binder, in its Mastercube range for the aquaculture market, in Asia, has shown superior performance over urea-formaldehyde, a substance customers are moving away from due to its formaldehyde toxicity characteristics.
Australia is experiencing severe climatic conditions, including drought, which is making conditions for agriculture extremely tough, especially in the dairy and beef cattle industries. Anpario has a number of business development initiatives underway including targeting the pet food industry.
The Middle East and Africa delivered a strong performance with major contributions from Iraq, Israel, Syria and the UAE. Growth was driven by increased sales of Orego-Stim as customers look to reduce and ultimately responsibly replace antibiotics and seek out performance benefits to improve the profitability of their operations. Other products which contributed to growth included Mastercube and Genex , Anpario’s pellet binder and phyto-acid combination products.
The UK market was stable and Anpario has recently seen an increase in demand for its organic acid products for feed and raw material hygiene. In continental Europe, the territories that delivered strong performances included Belgium and Italy, the latter benefiting from Anpario’s ability to supply products in smaller package sizes, for which our customers are increasingly requesting. A German subsidiary has also been incorporated and recently recruited a business manager to help establish a direct sales presence in other German speaking markets.