Eco Animal Health warns on FY revenues

1st Oct 2024 08:21

(Sharecast News) - Veterinary products group Eco Animal Health warned on Tuesday that recent challenges in China and Southeast Asia meant that full-year revenues would be "materially below" current market expectations.

Eco Animal Health said it had encountered challenges in China, due to low disease incidence in the summer months, and in Southeast Asia, where sales slowed due to customer churn.

However, Eco Animal said its Aivlosin asset had continued to gain market share in key territories, particularly Brazil and India, with revenues in those regions exceeding the board's expectations. In addition, and as expected, the AIM-listed group also said it was continuing to gain market share in the US.

"Due to the complex mix of geographies in which the ECO Group operates, foreign exchange headwinds, and the differing gross margins across each region, forecasting an adjusted EBITDA figure for the full year at this stage is challenging. The board expects that adjusted EBITDA for FY25 will be in the region of that observed in FY23 and notes it is likely that more accurate guidance will be provided when interim results to 30 September 2024 are announced in late November," said Eco Animal.

"The ECO Group has grounds for optimism for an improved performance in the second half with pork prices improving in China, strong order books and continuing strength in North America, Brazil and India. In addition, we have recently been notified that the ECO Group has received regulatory approval for the marketing of Aivlosin in Paraguay. This market produced 1.4m pigs in 2023, nearly 80% of which were in industrial farms."

As of 1050 BST, Eco Animal shares had sunk 18.04% to 79.50p.

Reporting by Iain Gilbert at Sharecast.com