18th Apr 2024 14:07
(Alliance News) - Carr's Group PLC on Thursday said opportunities for its Engineering division are being explored as part of an ongoing strategic review.
The Carlisle, England-based agriculture and engineering company reported a 31% decline in pretax profit to GBP3.4 million for the six months ended February 29, from GBP5.0 million last year.
Although the adjusted figures show pretax profit remained largely unchanged at GBP5.6 million.
Revenue increased by 2.0% to GBP81.4 million from GBP79.8 million.
And an interim dividend of 2.35 pence per share, up from 1.175p, will be paid on June 5.
In December, the board concluded that the current business model with the two divisions, Agriculture and Engineering, is inefficient and lacks synergistic benefits.
The company's Agriculture division particularly struggled during the first half with revenue falling 7.5% in contrast to Engineering's 26% growth.
However, the board believes both divisions hold value creation opportunities and the Agricultural division is to be optimised through transformation plans developed by recently appoint Chief Executive Officer of Agriculture Josh Hoopes.
Looking ahead, Carr's expects trading condition in agriculture to remain challenging over the short-term, particularly in the US where the industry is contending with cyclical herd reductions and regional droughts.
The company is however confident in its Engineering division over the near-term with its order book and strong first half performance.
Chair Tim Jones said: "We have concluded that our Engineering division represents a significant opportunity to deliver incremental value to shareholders now, and that it is the right thing to do to explore that opportunity."
In preparation for this the company extended its GBP25 million bank facilities until December 2026, and cost reduction measures will continue into next year.
Carr's shares were up 3.9% to 118.97 pence each in London on Thursday afternoon.
By Elijah Dale, Alliance News reporter
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