NWF shows its strength as profits rise

NWF, the Cheshire-based agricultural feeds, food logistics and fuel distribution business has reported a 5% increase in profits, despite challenging conditions in several markets.

Hailing a “good solid performance” Richard Whiting, NWF’s chief executive said his focus was for more organic growth and selective acquisitions when they emerge.

In the year to the end of May, NWF, which has its headquarters in Wardle, grew profits to £8.1% and reduced debt by nearly half from £11.7m to £5.9m.

Revenues were down 8.4% at £492.3m but that was down to the falling global oil price impacting its feeds division.

Whiting said: “The key measures for us are profits and return on capital employed and we are ahead on both. We have a very solid platform for development, and while we won’t get over-excited we are ambitious.”

The group has renewed £65m banking facilities with Royal Bank of Scotland to give it “significant headroom for investment in growth initiatives.”

Whiting said that while acquisitions are the “hardest thing to get right” they are part of his strategy.

“We acquired New Breed, a specialist agriculture business, in June. I had been talking to them for five years, so the timing has to be right.”
 
 By division, Feeds  saw its underlying operating profit fall from £3.3m to £1.8m in what was described as a “challenging year” with reduced milk prices and falling commodity prices resulting in margin pressure.

Operating profits in Food rose 25% to £2.5m as a result of operational efficiency achieved through the Boughey division operating at full capacity from the Wardle site.

In Fuels – underlying operating profits rose from £3.2m to £4.3m thanks to the sale of premium products, the falling oil price and strong operational management.

NWF increased its dividend nearly 6% to 5.4p per share.