Interim Results - Pre-tax Profit Up 20%
Cranswick PLC
17 November 1999
CRANSWICK plc INTERIM RESULTS: ANOTHER RECORD
Cranswick plc, the pet, agribusiness and food group which reported
its eleventh consecutive year of increased profits in May,
announces its unaudited results for the six months ended
September 30, 1999, which are its best yet.
Highlights:
* Pre-tax profit up 20 per cent at a record £2.9 million
(1998: £2.4 million)
* Earnings per share up 17 per cent at 13.6p (1998: 11.6p)
* Earnings per share up 21 per cent before amortisation of
goodwill
* Interim dividend up 11 per cent at 4.0p (1998: 3.6p)
* Increase in sales of value added products
* Second half acquisition of Pethick
Jim Bloom, Chairman of Cranswick, said: 'These results would
not be possible without the tremendous efforts made by all at
Cranswick in seeking continuous improvement in operating
efficiencies at each of our businesses. Our people at Cranswick
have proved yet again their expertise in continuing the growth
of the Company.
'The challenging trading environment of the first half of the
year will continue into the second half. We have an excellent
management team and committed employees who will meet these
challenges as before. The strategy remains unchanged'.
For further information:
Martin Davey, Chief Executive
John Lindop, Finance Director
Cranswick plc 077 7557 6426 (from 11.30 to 14.30)
Paul Quade
Paternoster Partnership Ltd 077 7048 8695
CRANSWICK plc
STATEMENT TO SHAREHOLDERS
Results
The Company continues to make good progress. Profit before
taxation in the six months to September 1999 increased by
20 per cent to £2.9m from £2.4m in the same period last year.
Earnings per share were 13.6p, a rise of 17 per cent compared
to last year's 11.6p. Before amortisation of goodwill, profit
before tax was £3.0m and earnings per share 14.0p, increases
of 22 per cent and 21 per cent respectively. These results
would not be possible without the tremendous efforts made by
all at Cranswick in seeking continuous improvement in operating
efficiencies at each of our businesses.
Review of Activities
Turnover (£m)
1999 1998
Pet 9.3 9.2 Avian and aquatic products
Agri 32.4 37.3 Pig feed and pig marketing
Food 52.7 44.5 Pork, ham and sausages
Less: Internal (23.2) (21.9)
------ ------
External 71.2 69.1
---- ----
Turnover in the pet business was slightly ahead of last time. In
the small animal food and bird seed activities of Buckton's there
was an increase in the value added sales of pre-packed small animal
food and a reduction in sales of products with less opportunity to
enhance value. In the Tropical Marine aquatics business the
increase in sales of both fish and dry goods was encouraging.
Cranswick Mill, our agribusiness activity, achieved an increase in
sales volumes of pig feed, which was very pleasing considering the
reduction in the UK pig herd, although the number of pigs marketed
was below the levels of a year ago. These changes in volumes along
with a reduction in the average selling price of pig feed were the
factors which led to the 13 per cent reduction in agribusiness
turnover.
The increase in turnover of the food manufacturing business
reflects the rise in sales of value added lines such as marinaded
pork products and hams at Cranswick Country Foods, and sausages
at Cranswick Gourmet Sausage Co. and Mr Lazenby's. We see
opportunities for further growth in these value added areas and
have recently expanded the business with the acquisition of
Pethick's. This acquisition, which was completed in October and
therefore is not included in the six months' figures, is performing
in line with expectations. We welcome David Pethick and his
colleagues to the Company.
Cashflow
Net borrowings increased by £5.4m to £11.7m in the six month
period compared with a reduction of £1.4m in the same period last
year. Working capital increased by £5.9m, the main factors being
an increase in stocks of £1.7m, principally a seasonal build-up
in the pet activities, and debtors were up by £4.2m, mainly within
the food activities. Capital expenditure amounted to £1.8m
largely comprising production facilities and equipment in food
manufacturing and £0.6m was spent on acquiring one third of the
minority interest in Cranswick Gourmet Sausage Co. Gearing was
59 per cent and interest cover 10 times.
Dividend
The interim dividend is to be increased from 3.6p per share
to 4.0p, up 11 per cent. The dividend will be paid on
28 January 2000 to shareholders on the register at the close
of business on 10 December 1999. Shareholders will again have the
option to receive the dividend by way of scrip issue.
Employees
Our people at Cranswick have proved yet again their expertise
in continuing the growth of the Company. Well done.
Outlook
The challenging trading environment of the first half of the
year will continue into the second half. We have an excellent
management team and committed employees who will meet these
challenges as before. The strategy remains unchanged. We will
continue to focus on specialist areas within the pet, agribusiness
and food sectors as we take the Company forward.
Jim Bloom Martin Davey
Chairman Chief Executive
17th November 1999
CRANSWICK plc
UNAUDITED PROFIT AND LOSS ACCOUNT
for the six months ended 30 September 1999
Half Year Year to
31 March
1999 1998 1999
£'000 £'000 £'000
Turnover 71,226 69,054 135,560
Operating profit 3,234 2,833 7,767
Interest charge 321 400 721
------- ------ -------
Profit before taxation 2,913 2,433 7,046
Taxation 843 706 2,006
----- ----- -----
Profit after taxation 2,070 1,727 5,040
Equity minority interest 79 57 129
----- ----- -----
Profit attributable to
shareholders 1,991 1,670 4,911
Equity dividends 753 523 1,975
----- ----- -----
Retained profit 1,238 1,147 2,936
Earnings per share: basic 13.6p 11.6p 34.0p
: diluted 13.3p 11.3p 33.0p
Dividends per share 4.0p 3.6p 13.5p
Notes
1. Operating profit is stated after charging goodwill amortisation
of £59,000 (1998-£nil). Basic earnings per share before goodwill
amortisation are 14.0p (1998-11.6p)
2. Earnings per share is based on the profit attributable to
shareholders and the average number of ordinary shares in issue
of 14,655,895 (1998-14,375,946). The calculation of the diluted
earnings per share is based on 15,009,749 (1998-14,807,558)
ordinary shares.
3. The taxation charge for the six months to 30 September 1999
reflects the estimated rate for the full year.
4. The accounting policies used in the preparation of the
financial statements for the six months to 30 September 1999 are
the same as those used for the statutory accounts for the year
ended 31 March 1999.
5. Accounts for the year ended 31 March 1999 received an
unqualified audit report and have been filed with the Registrar
of Companies. These financial statements are an abridged version
of those accounts.
6. The Company intends to post the Interim Statement to
shareholders on 19 November 1999. Further copies will be
available upon request from the Company Secretary, Cranswick plc,
Cranswick, Driffield, East Yorkshire, YO25 9PF.
CRANSWICK plc
UNAUDITED BALANCE SHEET
as at 30 September 1999
31 March
1999 1998 1999
£'000 £'000 £'000
Fixed assets
Intangible fixed assets 2,721 - 2,335
Tangible fixed assets 19,544 16,394 18,870
------ ------ ------
22,265 16,394 21,205
Current assets
Stocks 8,216 6,739 6,563
Debtors 18,950 15,582 14,736
Cash at bank and in hand 1,175 285 908
------ ------ ------
28,341 22,606 22,207
------ ------ ------
Creditors - amounts falling
due within one year
Loan notes payable 1,924 900 2,231
Bank loans 1,094 1,250 1,250
Bank overdraft 8,413 3,730 1,730
Hire purchase 170 114 142
Creditors 12,810 10,527 12,820
Corporation tax 3,190 1,755 2,367
Proposed equity dividends 753 523 1,452
------ ------ ------
28,354 18,799 21,992
------ ------ ------
Net current (liabilities)/assets (13) 3,807 215
Bank loans due after more
than one year (1,250) (2,344) (1,719)
Hire purchase due after more
than one year (52) (151) (181)
Deferred taxation (712) (741) (683)
Government grants (198) (228) (215)
-------- ------- -------
Total assets less liabilities 20,040 16,737 18,622
====== ====== ======
Capital and reserves
Share capital 1,469 1,452 1,462
Reserves 18,312 15,049 16,852
Equity minority interest 259 236 308
------ ------ ------
20,040 16,737 18,622
====== ====== ======
CRANSWICK plc
UNAUDITED CASH FLOW STATEMENT
for the six months ended 30 September 1999
Year to
Half Year 31 March
1999 1998 1999
£'000 £'000 £'000
Operating activities
Net cash (outflow)/inflow from
operating activities (1,569) 4,687 13,641
------- ----- ------
Returns on investment and
servicing of finance
Hire purchase interest paid (30) (15) (40)
Bank interest paid (273) (371) (674)
----- ----- -----
(303) (386) (714)
----- ----- -----
Taxation received/(paid) 9 (255) (1,307)
---- ----- -------
Capital expenditure and
financial investment
Purchase of tangible fixed assets (1,782) (1,534) (3,291)
Proceeds of sale of tangible
fixed assets 58 146 143
------- ------- -------
(1,724) (1,388) (3,148)
------- ------- -------
Acquisitions and disposals
Part purchase of minority interest (573) - -
Purchase of subsidiary undertaking - - (2,252)
Net cash acquired with subsidiary
undertaking - - 560
----- -------- -------
(573) - (1,692)
----- -------- -------
Equity dividends paid (1,380) (1,128) (1,621)
Cash (outflow)/inflow before
financing (5,540) 1,530 5,159
------- ------- -------
Financing
Issue of ordinary share capital 161 161 162
Medium term loan repayments (625) (625) (1,523)
Loan note repayments (307) - -
Capital element of hire
purchase payments (101) (56) (160)
------ ----- -------
Net cash outflow from financing (872) (520) (1,521)
------ ----- -------
(Decrease)/increase in cash in
the period (6,412) 1,010 3,638
======= ===== =====
Reconciliation of operating
profit to net cash (outflow)/
inflow from operating activities
Operating profit 3,234 2,833 7,767
Depreciation (net of government
grants) 1,030 1,048 2,007
Goodwill amortisation 59 - 39
Profit on sale of tangible fixed
assets (8) (19) (28)
(Increase)/decrease in stocks (1,653) 858 1,238
(Increase)/decrease in debtors (4,216) (34) 1,513
(Decrease)/increase in creditors (15) 1 1,105
------- ------ -------
Net cash (outflow)/inflow from
operating activities (1,569) 4,687 13,641
------- ----- ------
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