Full Year Results

"Foundations for growth"

Carr's (CARR.L), the fully-listed Agriculture and Engineering Group, announces results for the year ended 2 September 2017.

Financial highlights (continuing operations)

• Revenue up 9.9% to £346.2m (2016: £314.9m)
• EBITDA down 18.8% to £13.4m (2016: £16.5m)
• Underlying operating profit¹ down 28.5% to £9.3m (2016: £13.0m)
• Reported operating profit down 38.3% to £7.9m (2016: £12.8m)
• Underlying profit before taxation¹ down 20.2% to £11.4m (2016: £14.3m)
• Reported profit before taxation down 29.0% to £10.0m (2016: £14.1m)
• Basic EPS down 28.0% to 7.7p (2016: 10.7p)
• Adjusted¹ EPS down 18.3% to 8.9p (2016: 10.9p)
• Proposed final dividend of 2.1p resulting in a total for the year up 5.3% to 4.0p (2016: 3.8p), excluding the special dividend of 17.54p paid in October 2016
• Capital expenditure of £3.9m during the year
• Net debt of £14.1m at the year-end (2016: net cash of £8.1m)

Key Points

• Agriculture operating profit before amortisation of intangible assets and non-recurring items (excluding contribution from associate and JVs) down 17.2% to £8.6m (2016: £10.4m), due to a weaker performance primarily during H1 in the USA (detailed in our 30 March 2017 Trading Update). Agriculture revenue up 10.9% to £315.9m (2016: £284.8m) due to increased sales volumes and higher raw material costs.
• Profit from associates and joint ventures up 35.2% to £2.8m (2016: £2.1m).
• Overall profit from Agriculture (including associate and joint ventures) down 8.3% to £11.4m (2016: £12.5m).
• USA Agriculture recovery commenced in H2 and is expected to continue through the current financial year. Improved farmer confidence evident in the UK.
• Engineering operating profit before amortisation of intangible assets and non-recurring items (excluding contribution from associate) down 74.2% to £0.7m (2016: £2.6m) due to a major contract delay (detailed in our 30 March 2017 Trading Update) and certain short term, low margin contracts in UK manufacturing. Divisional revenue up 0.7% to £30.4m (2016: £30.1m).
• Delayed major Engineering contract commenced during H2 and will be delivered throughout the current financial year. Strong pipeline of current and potential contracts across Engineering businesses.

Chris Holmes, Chairman, said: “While 2017 was a challenging year, impacted by external market conditions, we made significant investment and progress towards achieving our strategic objectives. During the year we invested in the acquisition of two engineering businesses, STABER GmbH in Germany and NuVision Engineering, Inc. in the USA. In our Agriculture division, we invested in our new low moisture feed block plant in Tennessee, USA and, since the financial year end, in the acquisition of Pearson Farm Supplies Limited.

“Trading in the new financial year has started well and remains in line with the Board’s expectations. We believe that the investments we have made in acquisitions and research across both our divisions have laid a solid foundation for sustained growth and remain confident in the outlook for the Group.”

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