Hull-based meat processing giant Cranswick said its adjusted profit before tax for the 52 weeks ended March 26, 2023, rose 2.3% to £140.1 million on revenue up 15.7% to a record £2.32 billion.
Full year dividend from the FTSE 250 firm increased by 5% to 79.4p, delivering 33 years of unbroken dividend growth.
Cranswick also announced board changes.
Travis Perkins plc CFO Alan Williams joins the firm as an independent non-executive director on July 24, 2023. He will become chair the Audit Committee and a member of the Nomination and ESG Committees.
Liz Barber will succeed Mark Reckitt as the company’s Senior Independent Director with effect from his retirement on July 24.
Yetunde Hofmann has been appointed as the company’s designated director for engagement with the workforce.
Cranswick CEO Adam Couch said: “Over the last twelve months all at Cranswick have demonstrated resilience and determination in abundance, enabling us to deliver a strong set of results and make further meaningful progress in delivering our strategic objectives.
“I would like to thank our colleagues for their continued enthusiasm and commitment.
“I would also like to thank our suppliers and customers, with whom we continue to work in close partnership, for their support and understanding.
“We have successfully navigated three years of unprecedented disruption and uncertainty and we now have a much larger, more diverse, and better equipped business, which is primed to deliver the next phase of growth.
“We invested £85.1 million across our asset base during the year.
“Our total investment in the last three years exceeds £250 million. Investment during the year has been broad-based as we look to expand capacity and enhance the capability of existing facilities.
“We are proposing to lift our full year dividend by a further five per cent this year.
“This will be our 33rd year of consecutive dividend growth.
“We have made a positive start to the new financial year.
“The strengths of our business, which include our diverse and long-standing customer base, breadth and quality of products and channels, robust financial position and industry leading infrastructure will support the further development of Cranswick over the longer term.“
REACTION:
Steve Clayton, head of equity funds at Hargreaves Lansdown: “We hold Cranswick in our HL Select UK funds because, even when times are tough, it can deliver dependable growth like this.
“Few businesses offer such consistency of dividend growth through thick and thin.
“The yield of 2.5% might not be the highest out there, but it has been accompanied by substantial capital growth over the long term.
“The group have been innovative in managing their costs at a time of sustained pressure, not least by bringing in teams of trained butchers from the Philippines to offset skill shortages in the UK industry.
“Cranswick are a farm to fork operator and the group’s investment into farming capacity now sees them rearing almost 50% of the pigs they process into pork, ham and bacon.
“Because the group maintain a high level of dividend cover, they have ample free cash flow to reinvest into the business without incurring significant borrowings.
“This all reinforces the financial sustainability of the business, which in turn invests into the sustainability of its facilities. Fifteen Cranswick plants are certified carbon neutral already, with the remainder expected by 2030.
“With capacity in UK agriculture being withdrawn post-Brexit, Cranswick faces growing opportunities to be the supplier of choice to the UK’s major supermarket and food service operators.
“We see good scope for margins to rebuild as inflationary pressures ease, leaving the group well placed to grow from its modern, well invested production facilities.”