AgFeed Industries: Q1 profits up
Animal feed and pork company AgFeed Industries Inc reported a surge in first-quarter profit, sending its shares up 15 percent.
The company said the recent H1N1 flu had some effect on its businesses but the Chinese government had taken aggressive measures to curtail this problem in China.
"I think what it (H1N1 scare) did is that it contributed to lessening the demand in an already weak pricing environment. You had seasonal impact, and you had this sort of scare on top of it," Rodman and Renshaw analyst Joey Giamichael said by phone.
AgFeed also said hog prices will continue at low levels until late summer, but added prices will begin to climb by September as the Chinese economy accelerates. Giamichael said pricing improvement over the course of the year, coupled with sustained volumes by the company, would "dramatically" increase profitability.
For the latest first quarter, the company earned $3 million, or 8 cents a share, compared with $919,297, or 3 cents a share, last year. Revenue nearly tripled to $33.4 million.
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