(Reuters) - Ag Growth International Inc (AFN.TO), a portable grain handling equipment maker, reported a 13 percent rise in quarterly profit on strong demand.
The company, which makes grain handling equipment, storage bins and belt conveyors, said it expects a strong corn planting season in the United States to drive demand for its portable grain handling equipment.
“Demand for our portable handling equipment is very strong as corn planting in the U.S. is forecast to be the highest since 1937 and farmers in western Canada are expected to seed approximately eight million more acres of land than in 2011,” said Chief Executive Gary Anderson.
The U.S. Department of Agriculture’s (USDA) first estimates for this year’s harvest and next year’s demand showed that domestic corn stocks will surge from a near record low this year to a seven-year high by September 2013.
USDA said mild weather, plentiful rainfall and an early start to planting will result in big U.S. crops.
Ag Growth, however, said North American sales may not match last year’s levels.
Net income for the first quarter rose to C$5.3 million ($5.3 million), or 42 Canadian cents per share, from C$4.7 million, or 38 Canadian cents a share, a year ago.
North American sales of commercial handling equipment also rose, the company said.
Trade sales for the Winnipeg-based company, which had its market debut in May 2004, increased 10 percent to C$72.3 million.
Ag Growth shares, which have gained about a fourth of their value in the past six months, were down 1 percent at C$40.00 on Friday on the Toronto Stock Exchange.
($1 = 1.0021 Canadian dollars)
Reporting by Bhaswati Mukhopadhyay in Bangalore; Editing by Maju Samuel