Cranswick commissions Suffolk poultry plant as sales rise 5%

Cranswick has begun commissioning its new Suffolk poultry processing plant, which will open in the spring. The processing company said in its six month results, covering the period ending 30 September 2019, the new £74.8 million poultry primary processing facility at Eye, which will more than double existing capacity, is progressing to plan, with £24.1 million, out of a total of £27.0 million across the poultry category, spent on the project during the period.

The commissioning process started shortly after the period end in early November and is due to be completed by the financial year end. Investment in the upstream agricultural operations also continued during the period and a second feed mill in Hoxne, Suffolk came on stream shortly after the period end.  

Cranswick said its fresh chicken business continued to operate at full capacity during the period ahead of the move to the new Eye facility. The customer base was realigned during the period, with new business launched with the anchor customer for the Eye facility balancing the rationalisation of the existing customer base.

The company said it had suffered during the summer. “Above average summer temperatures adversely affected broiler growing performance and subdued wholesale pricing continues to impact the performance of the business,” the results said.

Adam Couch, Cranswick’s chief executive said of the group’s performance, which includes pork: “We have made a positive start to the year with reported revenue growth of 7.1% to £770.0 million underpinned by a very strong performance in our Far East export markets. The UK market remains highly competitive.

“We have again invested at record levels across our asset base to position the business for future growth. The Katsouris Brothers business, acquired in July, has been integrated successfully and is performing in line with our expectations.

“We completed the build phase of our new Eye poultry facility on time and to budget with the commissioning process successfully started in early November. 

“I remain confident that continued focus on the strengths of our business, which include long-standing customer relationships, breadth, quality and relevance of our products, robust financial position and industry leading infrastructure, will support the further successful development of Cranswick over the near and longer term.”

Adjusted profit before tax for the period was 3.6% higher at £46.4 million compared to £44.8 million in the corresponding period last year. Adjusted earnings per share on the same basis was up 2.3% at 71.6 pence compared to 70.0 pence in the equivalent period last year. 

Like-for-like revenue, which excludes the contribution from Katsouris Brothers during the period, increased by 5.4%, with corresponding volumes 0.6% higher.  Revenue growth from fresh pork, pastry, continental products, bacon and poultry was partly offset by lower year-on-year revenue in other pork related categories.
 
Adjusted group operating profit increased by 5.6% to £47.4 million. Adjusted Group operating margin at 6.2% was in line with the corresponding period last year.

Poultry revenue increased by 5.0% during the period, with a more moderate growth profile compared to recent reporting periods primarily reflecting the annualisation of new business wins in the cooked poultry category.


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