Festive performance sizzles at Cranswick as it agrees £30m Asda deal

FOOD producer Cranswick today said its strong performance had continued over its third financial quarter.

In a trading update for the three months to January 30, Hull-based Cranswick said underlying turnover  was 7% ahead of the same period last year, underpinned by strong volume growth.

The news comes as Cranswick wins a £30m deal to become Asda’s main fresh pork supplier.

It has bought a site in Hull – a former fish auction house – to meet the surge in demand and will create 100 jobs following the win.

Asda has moved to Cranswick from Vion after the Dutch-owned meat group closed a base in Scotland.
 
Total sales for the quarter were 8% higher after taking into account the contribution from Kingston Foods which was acquired last June. 

Sales growth of bacon, sausages and cooked meat products was particularly strong, Cranswick said, and there were positive contributions from most other categories. 

The performance comes off the back of a half year that saw both revenues and profits increase.

“Export sales remained buoyant and sales of pastry products continued to show pleasing progress,” the group said.
 
It added: “Rising input costs were a feature of trading during the period, with UK pig prices reaching record levels in December 2012. 

“Whilst this impacted margins initially, efficiency improvements brought about by on-going capital investment and constructive pricing discussions with customers helped to partially mitigate the full impact.”

Cranswick said the extension of its Sutton Fields cooked meats facility in Hull was completed ahead of the Christmas trading period and provided increased capacity to meet strong sales growth.
 
The quarter also saw record volumes produced and shipped from the group’s gourmet bacon facility at Sherburn-in-Elmet, near Leeds, following the recent substantial investment to increase capacity and improve operating efficiencies at the plant.
 
Cranswick said the development of a new pastry facility in Malton, North Yorkshire, remained on schedule and to budget, with first commercial production from the factory expected in late spring.
 
Net debt increased from £32m to £48m over the quarter.