Anpario plc the independent manufacturer of natural sustainable animal feed additives for animal health, nutrition and biosecurity has announced its results for the six months to 30 June 2021.
Sales revenue at actual exchange rates was down just 1 percent to £16.0m although, on a constant exchange rate basis, grew by 3 percent to £16.7m. Adjusted EBITDA, which excludes the impact of foreign exchange gains and losses, increased by 2 percent to £3.5m and profit before tax increased 12 percent to £2.7m.
The company saw strong sales growth in Latin America, United States, China and Australasia, despite currency headwinds. There was also strong demand for the company’s unique acid-based eubiotic brand pHorce® to the US swine sector as an anti-viral feed mitigant. Orego-Stim® also saw significant sales growth benefiting from aquaculture initiatives and the reduction in use of antibiotic growth promoters. And further sales growth for feed and raw material hygiene product, Salgard SW, which has proven efficacy against gram negative bacteria without the safety concerns associated with formaldehyde.
“Our strategy of offering more sustainable and environmentally friendly products as an alternative to antibiotic growth promoters and some of the harsher chemical treatments is gaining traction,” said Anpario chief executive Richard Edwards. “This performance should be seen in the context of a very strong comparative period and at a time when the UK’s trading relationship changed with the European Union.”
“We are excited about the changes occurring in our markets where Anpario’s environmentally friendly and sustainable solutions are gaining more interest from global producers,” added Mr Edwards. “The industry is moving away from the use of harmful applications such as formaldehyde and zinc oxide for antimicrobial control in addition to the trend to reduce antibiotic use. Over the past few years, our developments have been focused on products which comprise 100 percent natural and sustainable ingredients which work in synergy with the animal’s natural biological processes to boost immunity.”
“There has been a strong start to the second half of the year and we remain confident of continuing the profitable development of the group supported by a strong balance sheet and investment in our operations, technology and global sales channels.”
Latin America performance was supported with key contributions from Brazil and Chile. Chile’s strong growth was due to the commencement of commercial aquaculture trials using Orego-Stim® in the feed. Brazil’s 19 percent sales growth was driven by Orego-Stim® sales following successful business development with some new customers and an increase in sales of Prefect® to the aquaculture market. Anpario is expecting an improved second half from Latin America following new business wins with products such as Mastercube®, the company’s natural pellet binder, for aquafeed purposes.
US performance was flat at actual exchange rates but excluding currency movements sales grew by 11 percent and volumes by 26 percent. Anpario’s high strength acid-based eubiotic, pHorce®, showed excellent results in a trial undertaken to evaluate the ability of feed additives in mitigating the risk of virus-contaminated feed. Where used, pHorce® has managed to protect farms from outbreaks of the virus and is viewed as being a highly effective preventative product.
Overall, sales in the region declined by 2 percent, impacted by a significant decline of 31 percent across South-East Asia as further lockdowns and the slow rollout of the vaccines impacted economic activity and tourism in the region. However, this period should be compared to a very strong first half in the previous year and performance has improved from the second half of 2020 which appears to have been the bottom.
This weakness in trading, however, was cushioned by strong performances in both China and Australasia. China delivered very strong sales with growth of 113 percent as Orego-Stim® is adopted as a replacement for antibiotic growth promoters (AGP’s) primarily in piglet feed. The Australasia region delivered sales growth of 26 percent for the period helped by an increase in mould control product, Mycostat®, in the oilseed crusher segment.
The Middle East, Africa and India
Sales in the region declined by 5 percent compared to the same period last year, however this represents a 26 percent recovery in revenue from the second half of 2020 which was materially impacted by the COVID-19 pandemic. There have been some good performances in Pakistan, Yemen and Turkey and further growth opportunities in Iraq.
Sales in Europe declined by 5 percent compared to the same period last year affected by some distributors increasing stock in anticipation of Brexit, although normality in order patterns is returning.
Israel showed a very strong performance delivering sales growth of over 200 percent as the company’s distributor has been able to establish Orego-Stim® as the leading phytogenic brand. There is also increased interest in Anpario’s products for organic production as the European Union has committed to have 25 percent of agricultural land under organic farming by 2030.
The company has been making good progress with its raw material and feed hygiene product, Salgard SW, which is being recognised as the best environmentally friendly alternative to formaldehyde which was recently banned by the European Union. It is also seeing customers elsewhere look for credible alternatives.
As a result, Anpario has increased its liquid bulk storage facilities at Manton Wood to ensure rapid response to demand across Europe. It has also entered into a supply agreement with a global life science ingredients distributor to own brand its acid-based eubiotic technology for enteropathogen control applications in the rendering sector.