Blackfriar: The future looks bright for strong and stable Cranswick
This week it unveiled its biggest investment to date - plans to invest £67m in its poultry operations to double capacity.
It will also invest £29m to double the foot print of its charcuterie operations in Bury, where it produces cured meats, olives, corned beef, stuffed peppers, soft cheeses and party platters.
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Hide AdOn Tuesday Cranswick cheered investors with a 23 per cent leap in half year sales as it continues to defy the current consumer downturn.
The Hull-based group reported strong growth across all areas as more people opt for pork and poultry, which are seen as versatile and healthy options to more expensive red meats.
Exports are becoming increasingly important to the group and export revenues jumped 30 per cent in the six months to September 30.
The group has just been granted permission to ship pigs’ trotters to China and it has broken in to the South Korean and Japanese markets.
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Hide AdIn the past it has sold pig parts that British people don’t want to eat such as trotters but now it is selling pork belly and more premium cuts such as pork loin.
At the same time British demand is strong, helped by the fall in the pound since the EU referendum which has made imports more expensive.
The UK is around 55 per cent self sufficient for pork and Cranswick expects that figure to increase as we produce more of our own food post-Brexit.
Analyst Darren Shirley at Shore Capital said Cranswick’s results demonstrate the significant benefit of management’s clarity of strategy, industry leading investment profile and operational excellence.
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Hide AdThe group was formed in the early 1970s by farmers in East Yorkshire to produce animal feed and has since evolved into a business focused on the supply of food products to the UK food retail and food service sectors.
Well known for the production of gourmet sausages, the company is involved in the breeding and rearing of premium British pigs and also supplies fresh pork and fresh chicken. You may not be aware that you’re eating Cranswick’s products as they are sold primarily under retailers’ own labels including Sainsbury’s “Taste The Difference” and Tesco’s “Finest”.
The company has a firm understanding of British taste buds and a canny knack of predicting future trends such as meal kits. Strong demand for these kits, particularly in London, has driven sales in areas like marinated pork steaks.
As the country prepares itself for difficult economic times ahead, Hull-based Cranswick is plotting its own course.
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Hide AdThe firm’s chief executive Adam Couch said the group has recognised what could be a more challenging environment ahead and has made plans accordingly.
In preparation for the UK leaving the EU, Cranswick is investing in British workers and will have 100 apprentices across the business this year.
Cranswick has survived and thrived through previous downturns and recessions by investing in its operations and looks set to do the same again.
Whilst most economists are predicting flat to low GDP growth over the coming years, we should remember that every decade since the 1970s has endured a recession and companies should prepare for this decade’s downturn.
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Hide AdCranswick is a great example of a company that has modernised and moved with the times, spending money on its future production when others make cuts as they fear what the future holds.
Whatever happens to the economy, people still need to eat and Cranswick’s focus on pork and poultry will stand it in good stead. They are cheap, versatile and healthy when compared with red meats.
Whatever the economy throws at Cranswick, its genuinely strong and stable management team is set to cope admirably.