Pork demand boosts Cranswick

PORK supplier Cranswick reported an eight per cent rise in first half sales as shoppers switch to pork in favour of other meats.

Martin Davey, chairman of the Hull-based group, said pork sales are growing strongly with growth of between five and 10 per cent week on week.

"Pork's success is down to a number of factors," he said. "It is price competitive, it's very versatile and it is very low in fat. The consumer is picking up on the message."

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The group said the extension of the Lazenby's sausage facility in Hull and the new abattoir at the company's Hull-based primary pork processing site will both be fully commissioned in October.

Work on the extension of the air-dried bacon facility at Sherburn-in Elmet, near Leeds, is also well advanced.

In addition the company said good progress has been made at CCF Norfolk, the site it acquired in June last year.

Over the half year to September 30, record weekly volumes were processed at Norfolk.

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In July Cranswick transferred its Deeside cooked meats business over to Morrisons' subsidiary Farmers Boy in exchange for 49 per cent of Farmers Boy (Deeside).

Warren Ackerman, analyst at Evolution Securities, said it expects the deal will enhance Cranswick's relationship with Morrisons, which could lead to increased sales of other products to the Bradford-based supermarket chain.

Mr Davey said it was too early to say whether the Morrisons joint venture would lead to more business.

The shares closed up 4.4 per cent last night, a rise of 35.5p to 852.5p.

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Rating Cranswick as a 'buy' with a 950p target price, broker KBC Peel Hunt said: "Positive trends are continuing with organic growth up six per cent. Most categories are showing strong growth, with continental the only weak spot."

Evolution Securities and Investec also kept 'buy' ratings on the stock, with 940p and 925p targets, respectively.

Panmure Gordon analysts were less bullish and kept their 'hold' rating with an 880p target.

They said that while the firm's cash flow remains strong and it has cut its debt position, Cranswick's shares remain fairly valued.

Loyalty pays for Crawshaw

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BUTCHERS' chain Crawshaw saw a significant improvement in sales over the summer and autumn, giving the group confidence about the year ahead, writes Ros Snowdon.

The Rotherham-based group, which has butchery stores across Yorkshire, Lincolnshire and Nottinghamshire, said sales were flat at 9.4m for the six months to July 31, but towards the end of the period sales trends improved "significantly".

Chairman Richard Rose said: "We continue to drive customer loyalty which remains very high. Customers remain attracted by the combination of quality, choice and value."

Many of the group's newer stores have a higher proportion of hot cooked food and the group said this is proving very successful.

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Pre tax profits grew to 233,000 from last year's 44,000 loss.

Like for like sales were down four per cent in the six months to July 31, an improvement on the eight per cent reduction seen in the year to January 31.

The group, which has sites in Castleford, Huddersfield, Doncaster and Bramley in Leeds, has seen customers' buying habits change as a result of the recession with a move to cheaper cuts of meat.

Mr Rose said the larger format shops are proving particularly successful and these stores are showing good growth. As a result the group has decided to focus on this format for its store roll-out programme.

Net debt at 1m has increased marginally from 900,000 at the year end, due to the timing of working capital movements.

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