NWF targeting agriculture deals as profits rise

NWF, the Cheshire-based food, agricultural feed and fuel distributor, has reported a 28% surge in half year profits and says it is targeting acquisitions in the agricultural sector.

The company described its results for the six months to the end of November was “robust” with the feeds business the star performer, fuels performing well, while the Boughey food and warehousing division slightly behind expectations, chief executive Richard Whiting said.

Reflecting falls in the oil price, group revenue was down 2.7% to £256.5m, but reflecting the strong trading and operational performance profit were up 27.8% to £2.3m.

Mr Whiting said he was also pleased that by strong cash management practices, the group had been able to slash net debt by 53.2% to £13.7m.

Assessing the trading period he said: “We are in a comfortable position to be in at the half year. Feed has performed very strongly and by dealing directly with our farmer customers we have been abel to navigate some pretty volatile commodity prices.

“Fuels was much more stable this year than last, where in mild weather we had a lot of extra tankers and people than we needed. Food was pretty disappointing and that is because we haven’t won the new business we expected from the supermarkets, who have been hunkering down during a period of flat growth.”

Looking ahead he said the board is “comfortable” with analysts’ expectations of full year profits coming in around £6m,.

Turning to possible M&A activity, he said contact had been made with a number of corporate finance advisers to identify possible deals in the agriculture sector.

“There is nothing imminent, but agriculture is the focus of our attention. NWF has a long heritage in the market, and with 4,000 farmer customers, we see the opportunities for synergies and new products.”