Profits down at Cranswick after record year of investments

Revenues and profits at Cranswick have declined against a backdrop of “highly competitive market conditions and ongoing, Brexit related, political and economic uncertainty” according to their CEO.

The Hull-based food producer reported revenue at £1.44bn for the year to 31 March 2019, which it said was in line with the prior year after adjusting for the 53rd week.

Pre-tax profits dipped slightly for the year to £86.5m, down from £88.4m the year before.

It said a strong BBQ season last year helped as did pork exports to the Far East, but both were offset by lower sales of roasting joints and other more traditional products.

It said it had spent £79m in the past year to add capacity, extend capability and drive efficiencies. It has invested in new facilities in Milton Keynes, Hull and Bury.

Despite the lower performance in comparison with 2018, the board proposed an increase in the final dividend to 40p per share up from 38.6p previously, an increase of 3.6%. This gives a total dividend for the year of 55.9p per share, an increase of 4.1% on the 53.7p per share paid previously, making it the 29th consecutive year of dividend growth.

In February, a profit warning wiped nearly £300m off the FTSE250 firm’s market value. It blamed a “challenging commercial landscape” as well as costs related to its new facility in Eye, Suffolk, saying this was only partly offset by management actions.

It employs more than 5,000 people from its base in Hull.

Adam Couch, Cranswick’s chief executive officer commented: “The last year was one of consolidation following three years of very strong growth.

“We delivered this year’s results against a backdrop of highly competitive market conditions and ongoing, Brexit related, political and economic uncertainty.

“We invested at record levels across our asset base and made further strong progress against our strategic objectives.

“We continue to build a platform and lay down the pipeline for future growth.

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