Carr’s prepares market for lower results

CARLISLE food and engineering company Carr’s Milling Industries has said it is on-track to achieve market expectations for the full year, but emphasised that results would be lower than last year, with fertiliser revenues down 23% to date.

In an interim management statement the company said trading conditions in the fertiliser and animal feed markets have been adverse, whereas they were favourable the year before.

Fertiliser particularly has seen a “very substantial reduction in demand”. But price fluctuations mean revenue for the year to date is down by a smaller percentage than volumes, at 23%.

The company warned that because the price of raw materials is declining, the cost of some stocks is lower than their net realisable value. It said this had resulted in some negative margins in recent weeks but added that the higher priced stock will be sold by the year end.

In animal feed, the company said it has seen a substantial reduction in demand, driven by lower livestock numbers and cheaper home-grown cereals being used as feed, following a record harvest.

However, it has seen a strong performance in food, the retailing of agricultural machinery and supplies, and fuel oil distribution.

In food, the company said volumes are running at higher levels than last year which, combined with production efficiencies, has resulted in increased profit.

Hans Wälischmiller, the German robotics and protection equipment company it bought for £4.9m from administrators earlier this year, has been successfully integrated and is trading well, according to the company.

Net debt stood at £23.9m at the end of May, down £4.4m on a year earlier, which the company said was down to lower levels of revenue and improved working capital.