Revenue from east Asia was well ahead of the same quarter last year, Cranswick said, while underlying revenue was “well ahead” of the previous year. It was on track to meet the board’s expectations for the full financial year, boosted by a “robust performance” over the Christmas period, it said.
A Cranswick statement read: “Total and underlying revenue was well ahead of the prior year, underpinned by strong volume growth and supported, as anticipated, by a robust performance over the key Christmas trading period.
“Export sales continued to grow strongly, with Far East revenues well ahead of the same quarter last year, reflecting both ongoing demand from the region and increased output from the group’s two primary processing facilities.
Input costs had increased over the period, the meat processor said. But, improvements in efficiency, pig production and “constructive pricing discussions with customers” helped mitigate those costs, it added.
Cranswick also agreed a new five-year banking deal, which included a £150M revolving credit facility and a £20M overdraft.
‘Sound financial position’
“This unsecured facility supports the group’s sound financial position, and provides significant headroom for future growth,” said Cranswick.
It was confident of meeting its targets for the full-year, and of the long-term success and development of the business, due to its experienced management, strong product range and a well-invested asset base.
Meanwhile, news of Cranswick’s continued Far East export sales came after environment secretary Andrea Leadsom proposed exporting more food and drink products to China. Last month she said that exporting to China was a way to make “a real success of Brexit”.
- 38% rise in profits to £40.4M
- Revenue up 15.9% to £580.8M
- Export volumes up 23%
- Shore Capital analyst Darren Shirley: “We see today’s update as further confirmation that Cranswick is very high quality, best in class operator. With a still young and ambitious management team set upon delivering further growth from its market leading position in pork, coupled with the medium to long term potential from the group’s still modest but growing presence in poultry we view Cranswick as a core holding in the UK consumer arena.”
- HSBC Global Research analyst Damian Mcneela: “The business is well positioned to benefit from further supplier consolidation in the UK, continued penetration of the UK market with its faster growing niche products and has the ability to deploy its balance sheet to make further acquisitions and invest to support growth.”