REG - Cranswick PLC - First quarter trading statement

CranswickAnnouncement

29/07/2024 07:00

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RNS Number : 0994Y  Cranswick PLC  29 July 2024

29(th) July 2024

 

Cranswick plc

("Cranswick" or "the Company" or "the Group")

 

 

First quarter trading statement

 

Cranswick, a leading UK food producer, today provides an update on trading for
the 13 weeks to 29 June 2024.

 

Current trading

Trading in the first quarter of the new financial year has been strong with
robust demand continuing in our core UK food categories.  Group reported
revenue in the quarter was 6.7 per cent ahead of the same period last year
driven by strong volume growth which, in turn, reflected business wins and a
return to promotional activity across our customer base.  Premium product
ranges performed particularly well.  Easing input costs have been reflected
in selling prices.  On a like-for-like basis(1) revenue growth was 6.4 per
cent.

 

We continue to deliver industry leading service levels and drive innovation as
our customers and the UK consumer continue to appreciate the value for money,
versatility and quality of our pork and poultry ranges.

 

Integration of our agricultural operations continues to deliver positive
momentum, securing supply for customers' pork requirements whilst enabling
optimisation of cost of production and productivity, market leading farm
infrastructure and animal welfare standards.  During the first quarter we
completed the acquisition of a long-standing existing supplier of RSPCA
Assured outdoor bred pigs, based in East Anglia.  These farms will be
integrated into Cranswick's Wayland Farms operation, further increasing our
self-sufficiency in premium British pigs.

 

Export sales volumes were strongly ahead but were offset by reduced pricing in
the Far East and EU albeit there are early signs that Far East prices are
starting to firm.

 

Pet Products revenue was strongly ahead of the prior year reflecting the
continued onboarding of the Pets at Home business.

 

Investment

We continue to invest across our asset base to drive operating efficiencies
and to add capacity in readiness for new business coming on stream.  This
investment includes delivery of three ongoing earnings enhancing capital
projects that are progressing to plan: the multi-phased expansion project at
the Hull pork primary processing site; fit out of the new houmous facility at
Worsley, Manchester; and expansion of value-added poultry across both Hull
sites.

 

Financial position

Strong cash generation continued during the quarter, although, as expected,
net debt was modestly higher at the quarter end compared to the March 2024
year end position.  The Group remains in a robust financial position with
committed, unsecured facilities of £250 million providing comfortable
headroom.

 

Outlook

The Group has delivered strong, volume led, revenue growth in the first
quarter, along with further investment in its farming operations, capacity
expansion and driving operating efficiencies.  The Board's expectations for
the current financial year ending 29 March 2025 are unchanged.

 

The Board remains confident that continued focus on the strengths of the
Company, which include its long-standing customer relationships, breadth and
quality of products and industry leading asset infrastructure, will support
the further successful development of the Group over the longer term.

 

 

 

Adam Couch, CEO of Cranswick, commented:

"We have made a strong start to the year, delivering another quarter of strong
revenue growth, whilst continuing to provide excellent service levels ensuring
full availability of our products for our customers and the UK consumer.  Our
continued capital investment programme, including integration of agricultural
supply chains, will further enhance operating efficiency and support UK food
security as we continue to deliver on our long-term growth strategy.

 

"Our poultry business is growing strongly and the substantial investment we
are making in our two value-added facilities in Hull will create the headroom
for further expansion in this category.

 

"Looking ahead we continue to lay the foundations which will allow Cranswick
to prosper.  We have added to our pig herd during the quarter and, going
forward, we expect to make further investment in our agricultural operations
to ensure supply chain security and value optimisation.  We expect demand for
our products to remain robust through the remainder of this year and our
outlook for the current year remains unchanged."

 

 

Interim results

The Company's next scheduled comment on trading will be the interim results
announcement for the 26 weeks ending 28 September 2024, on Tuesday 26 November
2024.

 

 

Enquiries:

 

 Cranswick plc                                 01482 275 000
 Mark Bottomley, Chief Financial Officer

 Sodali & Co                                   020 7250 1446
 Ben Foster / Elizabeth Kittle / Louisa Henry  cranswick@sodali.com (mailto:cranswick@sodali.com)

 

Notes:

 

1.     For comparative purposes, like-for-like revenues exclude the impact
of current year acquisitions and the contribution from prior year acquisitions
prior to the anniversary of their purchase.

2.     Cranswick is a leading and innovative supplier of premium, fresh
and added-value food products.  The business employs over 15,000 people and
operates from 23 well-invested, highly efficient facilities in the UK.
 Cranswick was formed in the early 1970s by farmers in East Yorkshire to
produce animal feed and has since evolved into a business which produces a
range of high quality, predominantly fresh food, including fresh pork,
poultry, convenience, gourmet products and pet food.  The business develops
innovative, great tasting food products to the highest standards of food
safety and traceability.  The Group supplies the major grocery multiples as
well as the growing premium and discounter retail channels.  Cranswick also
has a strong presence in the 'food-to-go' sector and a substantial export
business.  Results for the 53 weeks to 30 March 2024 showed revenue of
£2,599.3m and profit before tax of £158.4m.  For more information go to:
www.cranswick.plc.uk (http://www.cranswick.plc.uk)

3.     At Cranswick, it is second nature for us to protect and nurture our
environment while supporting people and communities to thrive.  Guided by our
sustainability strategy, Second Nature, we have seamlessly integrated our
sustainability commitments into the core of our business model, which in turn
shapes our decision-making, culture, and actions.  For more information on
out Second Nature strategy, please visit: www.cranswick.plc.uk/sustainability
(http://www.cranswick.plc.uk/sustainability)

4.     This announcement is based on information sourced from unaudited
management accounts.

5.     This announcement contains certain forward looking statements.  By
their nature, forward looking statements involve a number of risks,
uncertainties or assumptions that could cause actual results or events to
differ materially from those expressed or implied by those statements.
Forward looking statements regarding past trends or activities should not be
taken as representation that such trends or activities will continue in the
future.  Accordingly undue reliance should not be placed on forward looking
statements.

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