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Latest Results

Interim Results for the six months ended 3 March 2018

"Significant improvement in performance"

Carr's (CARR.L), the Agriculture and Engineering Group, announces its results for the six months ended 3 March 2018. 



The full results are available to download in PDF format

Interim Management Report


Carr's has delivered a strong set of results for the period, significantly ahead of the prior year and slightly ahead of the Board's expectations. This has been driven by good performances in both Agriculture and Engineering.


During the 26 weeks ended 3 March 2018 the Group delivered a strong performance. Group revenues were £200.1m, up 13.2% from the prior year (H1 2017: £176.8m). Adjusted profit before tax increased by 22.0% to £10.9m (H1 2017: £9.0m); statutory profit before tax after amortisation and non-recurring items was £10.6m (H1 2017: £8.3m). Amortisation and non-recurring items of £0.3m (H1 2017: £0.7m) relate to business combination expenses, amortisation of intangible assets and restructuring costs.

Adjusted2 group operating profit of £9.2m (H1 2017: £7.6m) was 21.0% ahead of the prior year, and statutory operating profit was 28.4% ahead of the prior year at £8.9m (H1 2017: £6.9m).

The Group's share of profit after tax from associate and joint venture companies was up 25.3% on the prior year to £2.1m (H1 2017: £1.7m).

Basic earnings per share increased by 40.6% from 6.4p to 9.0p. On an adjusted2 basis, earnings per share increased by 29.6% to 9.2p (H1 2017: 7.1p).


As communicated at the time of the January Trading Update, conditions in UK Agriculture have continued to improve with steadily increasing farm incomes continuing to reinforce confidence in the outlook for the industry. Additionally, in the USA, a sustained recovery in the cattle market has provided favourable market conditions. Against this backdrop, the Agriculture division has reported adjusted2 operating profit before amortisation and non-recurring items of £7.8m (H1 2017: £7.3m), up 6.3% and slightly ahead of the Board's expectations for the half year. Statutory operating profit was £7.6m (H1 2017: £7.1m).


UK Agriculture has continued its strong start to the year, as farm incomes continue to steadily improve, reinforcing confidence in the outlook for the UK agriculture sector. Total feed volumes increased 6.3% during the period, which was largely driven by the successful integration of our recent acquisitions and increased market demand.

Feed block sales have continued to perform well in the UK, with sales volumes 9.3% ahead of the prior year. Despite a slow start to the year in our fuel distribution business, due to milder weather and wet ground conditions impacting agricultural operations, following the colder weather towards the end of the period the business is now trading ahead of last year with volumes up by 5.6%.

Our retail business has performed well in the period with sales 15.7% ahead of the prior year and like for like sales 3.5% ahead. The acquisition of Pearson Farm Supplies in October 2017 and its subsequent integration have been successful. As expected, the acquisition has enabled synergies to be achieved with our existing retail business and the new team has settled in well. Our retail footprint now stands at 43 stores.

Machinery sales remained strong during the period, with revenues 8.9% ahead of the prior year, reflecting the continued improvement in farm incomes and confidence in the outlook.


As expected, the recovery in the USA market, witnessed in the second half of last year, continued during the period as cattle prices for producers continued to improve, with feed block volumes 11.0% ahead of the prior year. Following a delayed start, our new low moisture feed block plant at Shelbyville, Tennessee is now in full production and volumes continue to grow. The plant offers the Group broad access across the Eastern and South Eastern states of the USA and has provided us with additional capacity as the market continues to improve.

We are seeing an improvement in our feed block sales in Europe through Crystalyx Products GmbH, our joint venture business based in Germany, as a result of improved farm incomes. Volumes were 21.6% ahead of the prior year.

Our subsidiary in New Zealand, which has established a direct sales operation distributing to farmers through key merchants, has seen a further increase in volumes during the period as we continue to strengthen our presence in this key market. In South America, our trials at research institutes in Brazil continue to make good progress.


It is pleasing to report that our Engineering division has made a strong recovery following the difficulties experienced in 2017 largely attributable to a major contract delay. Adjusted operating profit was up 382.5% at £1.4m (H1 2017: £0.3m); statutory operating profit was £1.3m (H1 2017: loss of £0.2m). The acquisition and subsequent integration of STABER has been successful and the integration of NuVision is proceeding to plan. Additionally, we have recruited a new Managing Director for our Engineering division to oversee and co-ordinate our operations in the UK, Germany and the USA and to drive further growth.

UK Manufacturing

Our UK Manufacturing business performed significantly ahead of the prior year. Work continues to progress on the significant contract announced last year, with the design phase nearing completion and the project moving towards the main manufacturing phase. The recovery of the oil price, together with strengthened management, more effective business development and increased efficiencies, has given rise to a significant uplift in volumes within our precision engineering business.

Remote Handling

The remote handling businesses have performed well in the first half of the year and in line with the Board's expectations. The substantial orders from China, which were won last year, have now been delivered and the order book remains strong. The extension of our facility in Markdorf, Germany is nearing completion which will provide additional capacity and further integrate STABER into Wälischmiller following the acquisition last year.

USA Engineering

The integration of NuVision, our engineering company focused on providing value in commercial nuclear power plants, government waste remediation facilities and waste clean-up, continues to progress well and the business performed slightly ahead of the Board's expectations during the period. The Group remains enthusiastic about the opportunity to market Wälischmiller remote handling equipment in the USA and the reorganisation of our management and leadership teams has proceeded to plan.


Net cash generated from operating activities was strong in the first half at £5.5m (H1 2017: £5.2m). Net debt has risen to £16.1m from £14.1m at the 2017 financial year end. This is primarily related to seasonal working capital increases and the acquisition of Pearson Farm Supplies Ltd.

The Group's defined benefit pension scheme remains in surplus and this increased from £5.2m at 2 September 2017 to £6.0m at 3 March 2018.


Shareholders' equity at 3 March 2018 was £96.1m (2 September 2017: £91.5m), with the increase primarily due to profit retained by the Group for the period.


A first interim dividend of 1.075 pence per ordinary share (2017: 0.95 pence per ordinary share) will be paid on 21 May 2018 to shareholders on the register on 27 April 2018. The ex-dividend date will be 26 April 2018.


The Group has a process in place to identify and assess the impact of risks on its business, which is reviewed and updated quarterly. The principal risks and uncertainties for the remainder of the financial year are not expected to change materially from those included on pages 14 to 16 of the Annual Report and Accounts 2017.

The principal risks and uncertainties are as follows:

  • IT and Cyber Security
  • Brexit
  • Acquisitions
  • Managing Costs
  • Reliance on Key Customers
  • People
  • Strategic Partners
  • Customer Demand
  • Treasury
  • Business Continuity


We will continue to deliver on our stated strategic objectives of investing in our people and our asset base, while continuing to drive product innovation and deliver growth in both of our divisions.

In UK Agriculture, we now have greater visibility on what Brexit might mean in relation to farming support in the near term. However, we are cautious as uncertainty remains as to what future trade agreements will be implemented, both with the EU and the rest of the world. We are responding to this by ensuring we keep our existing product offering relevant to our customers whilst also developing organic growth opportunities.
In the USA, the improved cattle price coupled with our greater geographic reach provides the Board with confidence in the medium term.  We will continue to identify suitable acquisitions with a focus on broadening our international footprint.

Our Engineering division has been significantly enhanced by the recent acquisitions and the order books across our businesses remain strong. We are greatly encouraged by the opportunities apparent within the division, particularly in China and the USA, and have confidence in the division's prospects.

We are pleased with the contributions made by both divisions during the first half of the year. Trading in the second half has started well and the Board now anticipates that trading for the full year will be slightly ahead of its previous expectations. The investments we have made in acquisitions and research leaves Carr's well placed for further growth in the medium term.

2 Adjusted results are after adding back amortisation of intangible assets and non-recurring items including acquisition costs



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