(Reuters) - Ag Growth International Inc (AFN.TO) posted a fourth-quarter profit on strong portable grain handling equipment demand in North America and said it expects gross margins to remain strong this year.
A bumper corn crop harvest in the United States and a return to normalized conditions in western Canada will drive demand, the maker of portable grain handling equipment said.
The International Grains Council in its latest update raised its global corn production forecast to 864 million tons.
Graphic on corn acres: link.reuters.com/dyz86s]
The USDA is currently forecasting that farmers in the United States will plant 94 million acres of corn this year, up from 92 million acres last year, Ag Growth said.
The company, which made its market debut in May 2004, said demand for commercial equipment remains strong in North America.
Ag Growth, which makes belt conveyors, handling accessories and aeration equipment, said interest in its storage bin product remains strong in the domestic as well as overseas markets.
For the October-December quarter, net income was C$3.3 million ($3.33 million), or 26 Canadian cents a share, compared with a loss of C$379,000, or 3 Canadian cents a share, a year ago.
Strong preseason activity throughout North America drove post-harvest demand for portable handling equipment in the quarter, the company said in a statement.
Trade sales for the company, which has facilities in Canada, the United States, the UK and Finland, rose 36 percent to C$67.0 million.
Analysts on average had expected a profit of 15 Canadian cents a share on revenue of C$53.3 million, according to Thomson Reuters I/B/E/S.
Shares of the Winnipeg-based company closed at C$34.45 on Tuesday on the Toronto Stock Exchange.
$1 = 0.9906 Canadian dollars Reporting by Bhaswati Mukhopadhyay in Bangalore; Editing by Sriraj Kalluvila