18 July 2018
Trading slightly ahead of expectations across both Agriculture and Engineering
Carr's (CARR.L), the Agriculture and Engineering Group, issues the following trading update for the year ending 1 September 2018. This update relates to the 17-week period ended 30 June 2018.
Overall, Carr's is trading slightly ahead of the Board's previous expectations detailed at the time of the Group's interim results, and significantly ahead of the prior year, across both Agriculture and Engineering.
UK Agriculture continues to perform well across all areas reflecting improved farm incomes and ongoing confidence over the near term. Feed volumes, retail sales, machinery sales and fuel sales are all ahead of the prior year. Pearson Farm Supplies, which we acquired in October 2017, has been successfully integrated into the wider Carrs Billington Agriculture business delivering sales growth and excellent levels of customer service.
Feed block volumes in the UK remain on track. In the USA, feed block volumes are significantly ahead of the prior year as the cattle market continues to recover. In Europe, feed block sales through our joint venture business based in Germany, Crystalyx Products GmbH, continue to grow. Sales of feed blocks in New Zealand also continue to build.
The strong recovery in our UK Manufacturing business continues and order books remain strong. Work continues on the significant contract announced in July 2017.
Our remote handling businesses are performing well. The full integration of STABER GmbH and the extension of the Group's premises at Markdorf, Germany are nearing completion. This will bring additional capacity to support the ongoing growth of the business.
Our USA Engineering business also continues to perform well. NuVision has secured a good level of further work during the period, including a significant Mechanical Stress Improvement Process (MSIP®) contract, which adds further strength to the order book between FY19 and FY21. Progress continues to be made in establishing a market for Wälischmiller remote handling equipment in the USA following the acquisition of NuVision in August 2017.
The Board announces that a second interim dividend of 1.075 pence per share (2017: 0.95 pence per share) will be paid on 5 October 2018 to shareholders on the register on 24 August 2018. The ex-dividend date will be 23 August 2018.
Overall, the Board remains confident in the prospects of UK Agriculture in the near term, although caution remains given the uncertainty over the nature of the UK's future trade agreements after Brexit. We anticipate that the gradual recovery in the USA cattle market seen last year and into the current financial year will continue. This, alongside our greater geographic reach, provides confidence in the medium term.
Order books across our Engineering businesses remain strong and the Board is pleased with the performance of the recently acquired NuVision business, which has greatly enhanced the division. The Board remains encouraged by the opportunities available across the Engineering division, particularly in the USA and China, which continue to be explored.
We remain focused on delivering our strategic objectives of investing in our people and our asset base, while continuing to drive product innovation and identifying suitable growth opportunities across both divisions, with a focus on broadening our international footprint.
We continue to perform well and the Board now anticipates that trading for the full year will be slightly ahead of its previous expectations detailed in the Group's interim results in April 2018.
Tim Davies, Chief Executive, commented:
"We are pleased to announce a strong performance during the period, across both our Agriculture and Engineering divisions. We have seen continued improvement in UK Agriculture, reflecting improved farm incomes and farmer confidence, and strong feed block sales, both in the UK and internationally. The performance of our Engineering division continues to improve, with recent acquisitions integrating well and further orders continuing to add strength to the order book.
Trading during the year has continued to improve and we now anticipate that trading for the full year will be slightly ahead of our previous expectations. We remain confident that our investments in acquisitions and research, alongside our international footprint, leave us well positioned for sustained growth."
The Company expects to issue its preliminary results for the year ending 1 September 2018 on 12 November 2018.
|Carr's Group plc
|Tel: +44 (0) 1228 554 600
|Tim Davies (Chief Executive)
Neil Austin (Group Finance Director)
|Tel: +44 (0) 20 7250 1446
|Nick Dibden / Lisa Kavanagh / Sam Austrums
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 over 50 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 and provides technical engineering services into the nuclear, petrochemical, oil and gas, pharmaceutical, process and renewable energy industries, including robotic and remote handling equipment.