Carr's (CARR.L), the Agriculture and Engineering Group, is issuing a trading update for the year ending 2 September 2017. This update relates to the 19 week period ended 16 July 2017.
Overall trading for the Group remains in line with the Board's expectations for the current year.
The recovery in UK Agriculture continues with all aspects of the business performing well. Feed volumes and like for like retail sales are running ahead of the prior year, while machinery revenues are significantly ahead of the prior year.
On 5 June 2017, Carrs Billington Agriculture (Sales) Limited acquired the trade and assets of Mortimer Feeds, a feed merchant business principally operating in Cheshire. The acquisition adds incremental feed volume and converts some existing merchant business into direct sales, and is in line with our stated strategy of strengthening our presence in our current geographies and leading in dairy nutrition.
Feed block sales in the UK remain in line with expectations having delivered volume growth during the main selling season. The USA feed block business has had a disappointing year following significantly lower cattle prices impacting sales volumes. The recovery of the USA market continues as anticipated and trading remains in line with our expectations.
UK Manufacturing has continued to be impacted by the issues previously reported, particularly the significant contract delay and the current pressures in the oil and gas market that are predominantly impacting margins. Factory throughput, however, is currently high with a steady pipeline of opportunities building. The delayed contract has now been signed and this will be delivered through the next financial year into 2018/19.
Our remote handling business is currently performing well, with high levels of activity manufacturing products for the Chinese market. The order book is currently at its highest level for a number of years resulting in an encouraging outlook.
The Board announces that a second interim dividend of 0.95 pence per share (2016: 0.95 pence per share) will be paid on 6 October 2017 to shareholders on the register on 15 September 2017. The ex-dividend date will be 14 September 2017.
The recovery in UK Agriculture is expected to steadily continue and there are early positive indications of a revival in the USA feed block market on the back of a gradual recovery in cattle prices. While we remain encouraged by the prospects in the nuclear sector, the Board's expectations for the Engineering business' performance for the full year remain unchanged.
Tim Davies, Chief Executive, commented: "It is pleasing to see UK agriculture continuing to improve, buoyed by the improvement in farmgate milk prices and, with green shoots of recovery in the USA market, we are confident of the medium term prospects within our Agriculture division.
We are pleased to report that the delayed contract in Engineering has now been signed and will be delivered in the next financial year, in line with our existing expectations. In addition we have a strong pipeline in place and our remote handling business is performing ahead of expectations.
We will continue to focus on growth, both through the organic development of our businesses and through selective acquisitions and the Board expects to report results for the full year in line with its expectations."
The Group expects to issue its Preliminary Results for the year ending 2 September 2017 on 13 November 2017.
|Carr's Group plc
Tim Davies (Chief Executive Officer)
Neil Austin (Finance Director)
|020 7549 0993|
About Carr's Group plc:
Carr's is an international leader in manufacturing value added products and solutions, with market leading brands and robust market positions in Agriculture and Engineering, supplying customers in 35 countries around the world.
Its Agriculture division manufactures and supplies feed blocks for livestock, farm machinery and runs a UK network of rural stores, providing a one-stop shop for the farming community. Its Engineering division designs and manufactures bespoke equipment for use in the nuclear, petrochemical, oil and gas, pharmaceutical, process and renewable energy industries, including robotic and remote handling equipment