On news of its latest results Carr's Milling Industries' share price topped 700p - as it did both in 2006 and 2007, before falling back. The key behind the impressive rise in profits and earnings was the jump in sales.
Around half the £43.5m advance was the result of higher selling prices as rising raw material prices were quickly passed onto customers. Another £8.3m came from acquisitions and the balance from higher volume sales spurred on by fears of higher commodity prices:
In terms of individual divisions, the star performer was agricultural manufacturing whose half year profits soared from £1.07m to £2.59m on sales 62 per cent higher at £36.8m. "Price increases and advance fertiliser sales" were the key ingredients behind those numbers. There were also good results from agricultural trading and particularly from winter sales of fuel oil. On a year-to-year basis inventories have jumped from £29m to £47.8m thanks largely to higher stocks of fertiliser ahead of the all important March and April fertiliser spreading season. That rise plus acquisitions have pushed up year-on-year net debt from £19.5m to £28.2m.
Not surprisingly, broker Investec Securities is revisiting its forecasts and now expects full-year sales to jump from £345m to £415m, pre-tax profits to advance from £9m to £12.3m and EPS up from 64.1p to 89p.
CARR'S MILLING INDUSTRIES (CRM) | ||||
|---|---|---|---|---|
| ORD PRICE: | 697.5p | MARKET VALUE: | £ 61.1m | |
| TOUCH: | 685-710p | 12-MONTH HIGH: | 709p | LOW: 477.5p |
| DIVIDEND YIELD: | 3.5% | PE RATIO: | 8 | |
| NET ASSET VALUE: | 462p* | NET DEBT: | 61% | |
| Half-year to 26 Feb | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 161 | 5.31 | 38.4 | 6.00 |
| 2011 | 205 | 7.91 | 58.6 | 6.50 |
| % change | +27 | +49 | +53 | +8 |
Ex-div:20 April Payment:17 May Sector: Food processing. * Including intangibles of £5.89m, or 67p a share | ||||
