Shares of Hull-based meat processing giant Cranswick Plc edged higher on Thursday after it published a trading update for the 13 weeks to December 26, 2020, showing its strong revenue and earnings momentum of the first half of the financial year continued during the third quarter.
“Consequently, the outlook for the current financial year is now expected to be ahead of the board’s previous expectations,” said the firm, which employs over 12,500 people at 16 facilities in the UK.
“UK retail demand remained strong during the quarter, reflecting the continued shift towards greater in-home consumption resulting from the COVID-19 pandemic,” said Cranswick.
“Performance over the festive trading period was robust and ahead of the same period in 2019, reflecting a well-executed Christmas plan, supported by exemplary service levels to our customers and tight cost control.
“The UK pig price continued to ease during the period, ending the quarter 9 per cent lower than at the same stage last year.
“This downward trend is being reflected in selling prices.
“Far East export sales were, as anticipated, lower than the same quarter last year due to a greater proportion of output being directed to UK retail customers and the temporary self-suspension of the group’s China export licences for its Northern Ireland and Norfolk primary processing facilities.
“The licence for the Northern Ireland facility was reinstated on 23 November 2020 and we expect exports to resume from the Norfolk facility in the coming weeks.
“Thorough planning ensured we were well prepared for the UK’s exit from the European Union on 31 December 2020.
“We worked closely with suppliers and customers to proactively manage supply chain risks and had developed and successfully implemented mitigating action plans to minimise Brexit related costs and supply chain disruption.
“We are providing ongoing support to colleagues in obtaining UK settled status and we are recruiting more permanent team members …
“The capacity uplift from 1.1m to 1.4m birds per week at the Eye poultry facility will come on stream, as planned, during the final quarter of the year.
“Also, the new £20m Cooked bacon facility in Hull is well advanced and progressing to plan with commercial production due to start in Q1 of the new financial year.”
In its outlook, Cranswick said: “For the remainder of the current financial year the shift towards greater in-home consumption with resulting high demand for our products is expected to continue.”
Cranswick CEO Adam Couch said: “We have delivered another strong quarter of growth during which we have supported our customers by delivering excellent service levels to ensure full availability of our products both in store and on the fast-growing online channel.
“None of this would have been possible without the incredible support of our colleagues across the business and on behalf of the board I thank them for their continued commitment and dedication.
“Our outlook for the current financial year is now expected to be ahead of our previous expectations.
“Our continued positive progress reflects the substantial ongoing investment in our asset base and the quality and capability of our colleagues.”