7th Feb 2019 08:31
LONDON (Alliance News) - Cranswick PLC on Thursday said its third quarter revenue was hurt by lower sales from its pork-related categories.
Shares in Cranswick were down 17% at 2,461.40 on Thursday morning.
Revenue for the UK food producer's third quarter ended December 31 was 2% lower than the year-ago period as "strong growth in poultry and continental products was offset by lower sales from other, pork related, categories".
Cranswick noted the UK pig price had eased during the quarter, ending 7% lower than at the same stage last year and said this had been "reflected in selling prices".
However, Cranswick said its festive period performance was "robust", benefiting from the firm's "well-executed Christmas plan" as well as cost control and operational efficiencies.
Cranswick is currently constructing a new poultry processing facility in Suffolk and said this is "continuing to plan" with commissioning expected near the end of its next financial year.
Furthermore, Cranswick has secured a long-term supply agreement with supermarket chain Wm Morrison Supermarkets PLC for the supply of fresh poultry from this new Suffolk facility.
Cranswick will also begin supplying Morrison's with cooked poultry from its poultry facility in Hull.
According to Cranswick, net debt increased in its third quarter due to a "seasonal increase in working capital and ongoing expenditure on capital products", ending in line with the same period the year before. It currently has unsecured facilities of GBP160 million.
Looking ahead to its financial year ending March 2020, its operating margin is expected to decline due to a "potentially challenging commercial landscape", as well as costs from its new Suffolk facility.
"The board is confident continued focus on the strengths of the company, which include its long-standing customer relationships, breadth and quality of products, robust financial position and industry leading asset infrastructure, will support the further successful development of the group over the longer term," Cranswick said.
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