UK: Q1 "in line with expectations", says meat firm Cranswick
Cranswick had "steady start" to FY2014/15, Investec said
UK meat supplier Cranswick today (28 July) reported trading in its first quarter had been in line with the company's expectations.
Cranswick said sales in the three months to the end of June had risen 5%. The results reflected "continued growth across most product categories", the company said.
The group's operating margin, excluding net IAS 41 valuation movement on biological assets in the current and prior financial years, as well as non-recurring items in the prior financial year, was "similar" to the level it reported in its previous fiscal year as a whole.
Cranswick said work to extend the Delico cooked meats facility in Milton Keynes is, "nearing completion" as planned, a project it believes will improve "increased throughput and enhanced yields". A "major upgrade" to the chilling system at its Norfolk primary processing facility will have "similar benefits", it added.
Investec analyst Nicola Mallard described Cranswick's trading as a "steady start" to its financial year.
"Margins have been steady, with pig prices following more normal patterns and the group continues to deliver volume growth. The balance sheet remains in good shape to fund investment in existing assets or new assets should any acquisition opportunities arise," Mallard wrote in a note to clients.
Cranswick's shares, up 6.3% since the start of the year, were down 1.62% at 1262.16p at 10:16 BST today.
("Cranswick" or "the Company" or "the Group")
AGM and Interim Management Statement
Cranswick, the UK food producer, provides an update on trading for the period from 1 April 2014 to 27 July 2014. Trading information relates to the 3 months to 30 June 2014.
Trading so far in the current financial year has been in line with the Board's expectations.
Revenue in the three months to 30 June 2014 was 5 per cent aheadof the same period last year reflecting continued growth across most product categories.
Operating margin# in the first quarter was similar to that achieved in the previous financial year as a whole.
During the period, the Group has invested further in its asset base to increase capacity and improve efficiency. Work to extend the Delico cooked meats facility in Milton Keynes is, as planned, nearing completion. The project will provide more capacity to meet anticipated sales growth and the investment in advanced cooking and slicing technology will deliver increased throughput and enhanced yields. A major upgrade to the chilling system at the Norfolk primary processing facility will deliver similar benefits.
Net debt stood at £33 million at 30 June 2014, £22 million lower than the same point last year and compared to £17 million at 31 March 2014. The increase during the quarter reflects the usual seasonal uplift in working capital and the Group's on-going capital investment programme. The Group is in a sound financial position, with committed, unsecured facilities of £120 million which provide generous headroom going forward.
As announced on 19 May 2014, Bernard Hoggarth will retire from the Board at today's Annual General Meeting.
Also as announced on 19 May 2014, John Worby will stand down from his position as a Non-Executive Director at today's Annual General Meeting. Mark Reckitt joined the Board as a Non-Executive Director on 1 May 2014 and will take over from John Worby as Chair of the Audit Committee at the conclusion of today's Annual General Meeting.
With experienced management at all levels of the Group, a strong range of products, a well invested asset base and a robust financial position, the Board remains confident in the continued long term success and development of the business.
Original source: Cranswick
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