Interim Management Statement

RNS Number : 5122P

Carr's Milling Industries PLC

19 July 2010

 



IMMEDIATE RELEASE

Monday 19 July 2010

CARR'S MILLING INDUSTRIES PLC

Interim Management Statement

Carr's (CRM.L), the fully-listed agriculture, food and engineering group, is publishing its Interim Management Statement, for the 19 weeks to date since the group's 27 February 2010 half-year end.

Overview

Since the Interim Announcement of 12 April 2010, Carr's has continued to trade well resulting in a strong financial performance for the third quarter which is ahead of market expectations and will result in profitability for the full year well above last year's underlying result.

Highlights

·     Year to date trading is ahead of expectations

·     Strong performance from Agriculture division, particularly feed blocks and fertiliser

·     Food division continuing to operate in a difficult market

·     Engineering division trading better in the second half year

·     Strong balance sheet; gearing similar to last year after funding acquisitions

·     Second interim dividend of 6 pence per share

Agriculture

The Group had a strong third quarter trading performance with animal feed and fuel oils benefiting from the prolonged cold winter.

The long and severe winter also depleted farmers' forage supplies and, in the spring, our grassland fertiliser products were in demand.  After a period of rising fertiliser raw material prices earlier in the year, prices stabilised and reduced uncertainty in the market.  Our speciality fertiliser product New Choice, with its slow release properties, enjoyed further sales growth as did Avail, the unique phosphate fertiliser enhancer launched last year.

Food

We successfully implemented a number of cost reduction initiatives to address, in part, the negative impact on margins from weaker consumer demand and continuing over-capacity in the market.

Engineering

In the UK, Bendalls, completed contracts for the nuclear decommissioning programme at Sellafield, Cumbria, and won further contracts for completion in 2011.  However, as the result of a delay in the placing of orders by its principal customer, revenue and profit at Carrs MSM is down compared to last year.

 Wälischmiller Engineering GmbH, based in south Germany, traded well during the period and won significant contracts in Germany, China and Japan.  The order book is strong and enquiry levels remain high.

Acquisitions

On 31 March 2010, the trade and assets of AgChem (UK), a wholesaler of fertiliser, was acquired for a cash consideration of £350,000. 

On 22 June 2010, the Company acquired Scotmin Nutrition Limited and A C Burn Limited for a total consideration of £5.62 million payable in cash out of the Company's existing banking facilities.  Both businesses are engaged in the supply of agricultural products to the Scottish market and complement the group's agricultural businesses.

Following integration, the acquisitions are expected to enhance the Company's earnings for the financial year ending 3 September 2011.

Indebtedness

At 29 May 2010, net debt was £18.5 million, down £5.4 million on £23.9 million a year earlier. This reduction reflects lower working capital needs in line with revenues.

The Board expects a cash outflow in the year arising from the two recent acquisitions for cash from its current facilities, with gearing expected to be similar to last year.  At 29 August 2009 net debt was £19.3 million with gearing at 65%.

Dividend

In line with its policy of paying three dividends per annum, announced on 12 April 2010, the Board has declared a second interim dividend of 6 pence per share, payable on 7 October 2010 to shareholders on the register on 10 September 2010.

Enquiries:

Carr's Milling Industries plc Chris Holmes (Chief Executive Officer) Ron Wood (Finance Director)	01228-554 600
Bankside Consultants Limited Simon Bloomfield or Rose Oddy	020-7367 8888

This Interim Management Statement has been drawn up and presented for the purposes of complying with English law. Any liability arising out of or in connection with this Interim Management Statement will also be determined in accordance with English law.

This Interim Management Statement may contain 'forward-looking statements'. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. Many of these risks and uncertainties relate to factors beyond the Group's control or which cannot be estimated precisely, such as future market conditions and the behaviour of the market participants. Actual outcomes and results may therefore differ materially from any outcomes or results expressed or implied by any such forward-looking statements.

 

END

 

 

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