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Brakke Consulting’s
Animal Health News & Notes for August 18, 2000
Copyright © Brakke Consulting, Inc.
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Company Earnings Releases
> Bayer reported that sales of the Animal Health Business Group rose significantly in the first half of 2000. Its strong performance in the U.S. market in particular, led to a 17% boost in revenues. In China, a new facility for the production of veterinary pharmaceuticals and feed additives came on stream as part of Bayer’s strategy to expand its business in that country. (company website)
> Synbiotics Corporation reported results for the second quarter ended June 30, 2000. Revenues for the quarter were $8.8 million, an increase of 4% compared to the second quarter of 1999. Net loss for the quarter was ($1.4 million), as compared to a profit of $473,000 for the year-ago quarter. Net income reflects a previously announced, non-cash after tax charge of ($583,000) related to a re-financing of the company’s debt facilities in April 2000. Sales reflected strong growth of Synbiotics Animal Health’s instrumentation products, which increased by 159% to $625,000 in the quarter, increases in diagnostic sales at Synbiotics-Europe, and the acquisition of the poultry diagnostics business of Kirkegaard and Perry Laboratories. Partially offsetting these increases were a decline in diagnostic sales to US distributors, erosion of ethical and OTC vaccine sales, and the effects of foreign currency translation. (BW HealthWire)
> PETCO Animal Supplies reported sales and net earnings for its second quarter and six month period ended July 29, 2000. Net sales for the second quarter increased to $262.7 million from
$236.2 million in the second quarter last year. During the second quarter, comparable store sales rose 5.0%. For the six months (26 weeks) ended July 29, 2000, net sales increased to $527.9 million from $465.8 million in the same period last year. Comparable store sales increased 6.7% for the six month period. Net earnings for the second quarter were $2.7 million, compared with $4.1 million in the second quarter last year. Net earnings for the year to date (26 weeks) were $9.1 million, compared with $7.7 million in the prior year period. Net earnings include the negative impact of Internet operations and equity in loss of unconsolidated affiliates. PETCO added 12 new superstores during the second quarter of fiscal 2000, compared with 10 new superstores opened in same period a year ago. PETCO has added 29 new superstores through the first six months of fiscal 2000. (PRNewswire)
> IGI, Inc. reported net income of $510,000 for the second quarter ending June 30, 2000. This compared to a net loss of $132,000 for the comparable period in 1999. Revenues for the quarter ended June 30, 2000 were $8,411,000, a decrease of 5%, compared to revenues for the prior period. For the six months ended June 30, 2000, the Company reported a net loss of $536,000 compared to a net loss of $451,000 for the first half of 1999. The decrease is primarily due to lower Companion Pet and Consumer Product revenues. Revenues for the six months ended June 30, 2000 were $16,865,000, a 4% decrease from revenues of $17,605,000, for the comparable period in 1999. The decrease is primarily due to lower Poultry Vaccine and Companion Pet Product revenues, offset by higher Consumer Product revenues.
(PRNewswire)
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Company News Releases
> IDEXX Laboratories, Inc. announced the acquisition of Genera Technologies, Ltd., a UK-based company with annualized revenue of approximately US $4 million. Genera is a leader in the development and commercialization of instruments and consumables for the detection of Cryptosporidium in water. The company is also conducting research programs for the detection of other contaminates in drinking water. Cryptosporidium testing recently became mandatory in the UK, and Genera’s products have received regulatory approval in the UK and the United States. (BW HealthWire)
> Biocor Animal Health, Inc. has acquired the Herd-Vac bovine modified live virus vaccine range from Bayer Animal Health. Biocor Animal Health will be marketing the Herd-Vac cattle vaccine range as well as their new Surround range of inactivated bovine vaccines. The Herd-Vac range of cattle vaccines has been manufactured at the Biocor Animal Health facility for many years; Biocor will now also assume the distribution and marketing of the vaccines. The new range of Biocor modified live and inactivated bovine vaccines adds to the existing range of canine and feline products to provide a growing, biologically focused portfolio. (company press release)
> Carrington Laboratories, Inc. received a milestone validation of its complex carbohydrate technology platform with the issuance of a full license from the USDA for Acemannan Immunostimulant as a biologic drug for the treatment of fibrosarcoma in cats and dogs. Acemannan Immunostimulant has been clinically shown to extend survivability when used as an adjunct to surgery in the treatment of canine and feline fibrosarcoma. Acemannan Immunostimulant has previously been available under a limited use license from the USDA. Acemannan Immunostimulant will be nationally marketed and distributed under the CarraVet label by Carrington’s licensee, Veterinary Products Laboratories. (PRNewswire)
> DirectAg.com announces a major step forward with the addition of Jim Gerardot, Gunter Hess and Victor Wright to the company’s animal health and productivity team. Gerardot, executive director of animal health and productivity for DirectAg.com, was most recently with Merial. Hess, a former divisional manager of Walco International, will manage e-commerce operations for DirectAg.com’s animal health and productivity team. Wright, director of animal health and productivity partnership accounts for DirectAg.com, joins the team following his global Ivomec brand management experience. (company press release)
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BRAKKE CONSULTING, INC.
Serving the Worldwide Animal Health and Pet Care Industries
Providing a complete range of consulting services, including:
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Animal Health News
> MetaMorphix is preparing to bring its first product out of its R&D pipeline. MyoXtra, based on the company’s myostatin platform, is targeted at the worldwide poultry industry. The product improves feed efficiency and meat yield while reducing waste and potentially reducing antibiotic use as performance enhancers. (Feedstuffs)
> Following the three confirmed CSF outbreaks in the UK’s largest outdoor pig breeding company, MAFF has now decided to slaughter all pigs on the company’s six other nursery pig rearing farms and to restrict and test the company’s six finishing pig farms. The farms are scattered over three counties of the United Kingdom. The company affected is one of the pioneers of multi-site swine production systems in the UK, which are designed to reduce transmission of enzootic diseases by early weaning of pigs from the breeding farm to a series of
remote locations. Including these farms, nearly 16,000 pigs have been slaughtered in efforts to control an outbreak of classical swine fever. (Pig Disease Information Centre)
> The European Commission is banning exports of live pigs from England due to an outbreak of highly contagious swine fever. The news was a fresh blow to Britain¹s farmers, who are still feeling the financial effects of a ban on British beef, which was lifted last year after more than three years. The ban will apply until August 31, and will be reviewed by EU veterinary experts at a meeting of the Standing Veterinary Committee on August 22. The curbs will apply to English exports only and not to pigs exported from other parts of Britain. (Reuters)
> The USDA halted all pig imports from England, due to an outbreak of swine fever there. The ban includes meat, live animals, semen and products made from swine. Britain has placed its own hold on all exports. Because Britain is not a major pork exporter to the American market, the U.S. import ban would not have a great impact on supplies. (Reuters)
> This year’s World Dairy Expo in Wisconsin will offer the first cloned dairy animal ever to be sold at public auction. A clone of Lauduc Broker Mandy, owned by Carrousel Farms, Orangeville, Ill. will be sold at the World Classic 2000, on October 6 in Madison. Bidders at the historic event will be offered the September 2001 heifer calf for delivery in December 2001. The Holstein is a two time All-American and three time All-Canadian winner. (AgWeb)
> TravelDog announces the relaunch of their web site with a completely new look and content. The site includes information from where to stay and how to get there to transportation services and doggie day care. For people who are new to traveling with a pet, TravelDog.com presents comprehensive information on airline regulations and quarantine laws, pet sitters and kennels, and proper pet etiquette in hotels and other public places. TravelDog.com also offers a full range of useful pet gear. Apparel and auto restraint, carriers, pet luggage, travel accessories and treats are among the offerings. (PRNewswire)
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Agribusiness News
> Genetically modified crops such as corn and soybeans have gained fast acceptance in the U.S. grain market in just a few years — faster than the means to track the crops through the food chain.
Traders and analysts agree that the current means of testing for GMO content are imperfect. Currently, grain merchants who want to know — and certify — what’s in their bins have to choose between simple portable test kits that generally check for only a single genetic trait at a time, or a type of DNA analysis called PCR that provides more information but costs more and takes several days. The USDA outlined plans in May to begin evaluating test kits and accrediting laboratories that perform GMO detection. (Reuters)
> U.S. grain exporters, faced with demands for sorting billions of bushels of genetically modified (GMO) grains from non-GMO crops for foreign customers, have a simple answer: you get what you pay for. And they say that some of the biggest buyers of U.S. grains – Japanese, South Koreans and to some extent the Europeans – are doing just that, paying more for cargoes of corn and soybeans that are non-GMO. Grain traders say non-GMO corn and soybeans are fetching premiums of 30 to 40 cents per bushel in the United States. The United States will produce about 13 billion bushels of corn and soybeans this year. A quarter of the corn and more than half the soybeans will come from GMO seeds, which help farmers and were approved by the U.S. government. About three billion bushels of those crops are projected as exports. (Reuters)
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Brakke Consulting Viewpoint
The second quarter results continue to be positive for most of the companies reporting. Two separate sources this week reported record corn and soybean harvests this year in the US. This means that feed grain costs should be positive for animal protein production. One of the independent economists we follow believes that poultry prices will remain low for the balance of the year, and that we could see $25.00 cwt cash prices for hogs again in 2001.
[Ron Brakke]
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