25th Nov 2013 08:34
LONDON (Alliance News) - British food producer Cranswick PLC Monday reported higher profits and revenues for the first half of the year, driven by strong sales and increasing demand for its fresh pork and bacon. It said the UK's recent barbecue summer helped sales of sausages.
The UK pork products supplier reported a 16% increase in its pretax profit of GBP26.1 million for the six months ended September 30, up from GBP22.4 million a year earlier. The group reported a net profit of GBP21.1 million.
It said that rising input costs due to pig prices reaching record highs during the period, was partially offset by on-going efficiency improvements, sales volume growth, and recent acquisitions. These include Wayland Farms and two additional breeding units purchased from Dent Limited at the end of the period, which are now operating under the Wold Farms banner.
Cranswick increased its interim dividend by 6.4% to 10.0 pence per share, and said that it expects its full-year performance to be in line with expectations.
Revenues of GBP483.5 million in the first half were up 15% from GBP418.6 million a year earlier, driven by a combination of new products, new customers, and strong fresh pork sales, which rose 26% during the period, as well as bacon sales, which rose 18%.
On an underlying basis, which excludes contributions from its recent acquisitions, revenue rose 13% to GBP474.9 million.
Cranswick said that its adjusted operating margin was lower than last year, due to higher pig prices and start-up costs associated with its new pastry facility in Malton in North Yorkshire, which officially opened at the beginning of November.
It said that its pastry business is making good progress, boosted by a number of new product launches and a high profile promotional campaign, and now has substantial capacity to meet future sales and volume demands and expectations.
Sandwiches sales fell by 5% as the group said it rationalised its core product range.
Sales of continental products were 3% lower than last year, as one of its retail customers moved its sourcing in-house during the first quarter.
Cranswick said cooked meats sales rose 13%, boosted by new product development in its premium ham products. Sausage sales rose 4%, as the recent warm UK summer spurred customers to get cooking on the BBQ, it said.
The company said its net debt increased by 15% to GBP37.2 million, due to investment in its new pastry facility, new product development, and further investment made in its pig breeding and rearing activities.
Cranswick shares were up 1.8% Monday morning at 1,119.90 pence per share.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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