Cranswick reports positive start to year

The Hull-based pork, sausage and bacon producer said that underlying turnover in the three months to June 30, 2013, was 10 per cent ahead of the same period last year. It added that the current financial year had started in line with the board’s expectations.

Total sales for the three months were 12 per cent higher after taking into account the contribution from Kingston Foods which was acquired on June 29, last year, and “modest” third party sales made by Wayland Farms, formerly East Anglian Pigs, which was acquired in April.

Operating margins in the first quarter were below those achieved during the previous financial year as a whole, reflecting higher input costs and, as was anticipated, start-up costs at the new pastry facility, said Cranswick.

It added: “As expected, pig prices increased during the first quarter of the financial year and have increased further during July to a new record high. The impact has been absorbed through on-going efficiency improvements and by the strong volumes processed through the group’s facilities.”

The group’s gourmet pastry facility at Malton, North Yorkshire was completed during the quarter. The factory is now commissioned, said the group, enabling it to further develop its existing business by offering a broad range of premium savoury pastry products.

Work has also started on extending the Delico cooked meats facility in Milton Keynes.

Net debt stood at £55m at the quarter-end, said Cranswick. This level was £17m higher than at the same time last year and compared to £20m at March 31, 2013.

The increase during the quarter reflects the usual seasonal uplift in working capital, the group’s on-going capital investment programme and the £13m investment in Wayland Farms, said Cranswick.

It added that the group is “in a sound financial position, with committed, unsecured facilities of £100m which provide generous headroom going forward”.