Cranswick has lifted its profit expectations for the current financial year, following a Christmas trading boost.
In its third quarter trading update, the integrated pork and poultry business said trading throughout the quarter, and particularly during the key Christmas trading period, was stronger than anticipated.
The Group’s Adjusted Profit Before Tax for the year ending March 30, 2024, is now expected to be ahead of the Board’s previous expectations.
Cranswick has consistently delivered strong trading performances in recent years. Its full results for the year ending March 25, 2023, showed revenue of £2,323.0m and profit before tax of £139.5m – and it appears well on course to surpass this in the current financial year.
In the six months to September 23, 2023, the Hull-based company grew its revenue by a further 12.3% year-on-year to just over £1.25 billion, with adjusted profit before tax for the period of £81.6m, 23.6% up year-on-year.
Strong revenue growth during Q3, the 13 weeks to December 23, 2023, was again underpinned by volume growth across all four core UK food categories – fresh pork, gourmet, convenience and poultry. Cranswick said this showed UK consumer ‘continue to appreciate the affordability, value for money and versatility of our core pork and poultry categories’.
Last year, pig farming acquisitions, including the £32 million purchase of Elsham Linc, comprising 8,000 sows producing 3,200 finished pigs each week, plus a feed mill, pushed Cranswick’s self-sufficiency in the pork it processes beyond 50%. It said the expanded pig farming and milling operations, including Elsham Linc, ‘continue to contribute positively’.
The company added that its ‘substantial ongoing capital investment programme continues to add capacity, drive automation and deliver efficiency improvements’.
On January 8, it signed an agreement to acquire the entire issued share capital of Froch Foods, an added-value processor of predominantly pork and poultry related products. The agreed transaction, which is subject to the usual regulatory approvals, is expected to complete tomorrow, January 19.
Cranswick is also investing heavily in its three fresh pork primary processing facilities to increase capacity and drive further operational efficiencies, including a £62m redevelopment of the Hull primary processing site.
The statement said: “The Board is confident that the continued focus on the strengths of the company, which include its long-standing relationships, breadth and quality of products, robust financial position, and industry leading asset infrastructure, will support the further successful development of Cranswick during the current year and over the longer term.”
Cranswick CEO Adam Couch added: “The positive momentum generated through the first half of the year continued through the third quarter.
“Trading in December was stronger than anticipated as we supported our customers in the lead up to Christmas with exemplary service levels and an innovative range of festive products.
“The passion, commitment and professionalism of our teams across the business is a key ingredient in our ongoing successful performance and, again, I would like to thank all our colleagues for their continued dedication and support.”