Cranswick confident after positive Christmas trading

CRANSWICK’S board is today says it is confident in both the current financial year and the continued long-term success and development of the business.

In a trading update for the three months to the end of December 2014, the East Yorkshire-based food producer, which is shortlisted for three awards in TheBusinessDesk.com’s Yorkshire Business Masters awards, 
said Christmas trading was strong, with December total and underlying sales well ahead year on year. 

Total sales for the quarter were marginally ahead of the same period last year and underlying sales volumes, excluding the contribution from Benson Park, which was acquired in October, improved by 2% as fresh pork returned to growth in the third quarter.  Underlying revenues were down 3% as lower input prices were passed through to the group’s customers.  Export sales continued to gain momentum with sales to non-European markets up 38% compared to the same quarter last year.

Cranswick added that the integration of Benson Park is progressing to plan and performance of the business to date has been in line with the board’s expectations.  Further capital investment, which was planned for at the time of the acquisition, will be completed during the next financial year. This investment will create substantial additional capacity as well as enabling the business to offer a broader product range and further improve operating efficiencies.

Following the expected seasonal increase in working capital, the acquisition of Benson Park and on-going capital expenditure, net debt increased from £22m to £57m during the quarter, with the operating cash outflow following a similar pattern to previous years.  Notwithstanding the investment in Benson Park, net debt was only £2m higher than at the equivalent quarter end last year.  The group is in a strong financial position, with committed, unsecured facilities of £120m which provide comfortable headroom going forward, it said.

Looking ahead, Cranswick said: “With experienced management at all levels of the group, a strong range of products, a well-invested asset base and a robust financial position, the board remains confident in both the current financial year and the continued long term success and development of the business.”