Cranswick enjoys strong half-year results
Cranswick has posted increased revenue and operating profit, with growth having been supported by contributions from Crown Chicken and the Ballymena pork processing businesses that were acquired in the previous financial year.
Reported revenue from continuing operations increased by 23% to £714.6 million, while like-for-like revenue was 18% higher, with corresponding volumes ahead by 9.9%.
Each of the business’s categories delivered positive volume growth, “comfortably ahead of overall category market growth”, with stronger pricing reflecting partial recovery of higher input costs compared to those experienced in the same period last year.
Fresh pork increased by 26.3%, with like-for-like revenue having grown by 12.8%, excluding the contribution from Ballymena.
The company noted that the Ballymena butcher hall extension was completed during the period, resulting in capacity being increased from 8,000 to 12,000 per week.
Further investment is being made at the Hull facility to lift pig chill capacity and to upgrade the rapid chill system to improve yields, according to Cranswick.
Total export revenue grew by 30.1%, despite a 7.9% decline in sales to Far Eastern markets, which was offset by a 133.2% increase in sales to other export markets – most notably, the US and Europe.
Like-for-like export sales, excluding those from Ballymena, grew by 18.6%.
Convenience and Gourmet Products
Convenience, which comprises cooked meats and continental products, marked a 17.2% increase, reflecting the “full contribution during the period of new business wins in the previous financial year”; convenience represents 37% of the group’s revenue.
The report noted that sales of cooked meats were “very strong”, with new product launches in the Ready to Cook and Slow Cook ranges also helping underpin growth in the category.
The company added that a further £7 million of capital investment was made across the three cooked meats facilities during the period.
What’s more, gourmet products, which comprise sausage, bacon and pastry, representing 18% of the group’s revenue, were lifted by 27.7% in the period, with all sub-categories delivering double digit volume growth.
“Strong sausage sales growth reflected the contribution from the new ‘Butcher’s Choice’ business launched mid-way through the previous financial year together with new business wins launched in summer 2017,” Cranswick stated.
“Both the Hull and Norfolk sausage facilities are gearing up for the peak Christmas trading period with two additional production lines installed at the Hull fresh pork facility to accommodate the expected seasonal spike in demand.”
In addition, new gammon and wet cure bacon business with one of the site’s principal retail customers, secured in quarter four of the previous financial year, also helped drive strong bacon sales growth.
The poultry category, which includes fresh and cooked poultry, saw revenue increase by 26.6%, including the full contribution from Crown during the period, with like-for-like sales having grown 21.3%.
The fresh and ready to eat chicken categories continued to be the “stand out” performers in the wider UK meat protein sector, according to Cranswick, with market volume growth of 5% and 9% respectively over the last year.
Adam Couch, Cranswick’s chief executive officer, commented: “We have invested a record £29 million in our infrastructure during the first half of the year.
“As part of the development of our rapidly growing poultry business we are announcing today our planned investment in a new primary poultry facility in Eye, Suffolk. This class-leading facility, which is scheduled for completion in late 2019, will double our existing capacity with further room for expansion.”