Cranswick suffers small drop in profit, but invests in the future

Cranswick suffered a small drop in pre-tax in the six months to September 30, but revealed it has undertaken record capital expenditure of £41m to provide the platform for future growth.

The Hull-based pork processing company has announced that for the six months to September 30, group operating pre-tax profits fell to £42.6 million, from £44.5m a year ago.

Adam Couch, Cranswick’s chief executive, said: “The first half performance was in line with our expectations. They were achieved despite more uncertain domestic market conditions and softer pricing in key export markets.

“The Group’s capital investment programme remains firmly on track. During the period we spent a record £41m across our already well invested asset base as we build a platform for future growth.”

Mr Couch added: “Our new £27m Continental Products facility in Bury, Lancashire was commissioned during the period. We have also invested heavily in the Group’s agricultural operations and construction of a £60m class-leading, primary poultry processing facility in Eye, Suffolk, which is due for completion towards the end of the next financial year, is now well underway.

“The board is confident that continued focus on the strengths of the Company, which include its long-standing customer relationships, breadth and quality of products, developing export channels and asset infrastructure, will support the delivery of its expectations for the current year and its further successful development over the longer term.”

Financial highlights

• Revenue of £719.2m (2017: £714.6m);
• Adjusted Group operating margin1 at 6.2% (2017: 6.2%);
• Adjusted profit before tax1 of £44.8m (2017: £44.4m);
• Adjusted earnings per share1 of 70.0p (2017: 70.0p);
• Dividend per share increased by 5.3% to 15.9p (2017: 15.1p); and
• Net funds at £2.2m (2017: net debt of £16.7m).