Weather knocks NWF

The profit shortfall is a direct result of the prolonged period of mild weather that led to a long grazing period up until the end of November and reduced demand for feedstuffs to such an extent that profits dropped a hefty 60 per cent to £600,000. It also cut demand for fuel oil – particularly heating oil – which accounts for a quarter of NWF's fuel sales. That said, fuel sales were up thanks to higher crude oil prices and acquisitions, but margins of only 1p a litre meant the business only managed to breakeven on sales of £181m, up from £133m at this stage last year. Even if you strip out £0.3m of acquisition and integration costs, profitability at the unit was still way short of the £0.7m operating profit reported in the prior half year.

To make matters worse, the warm weather has continued over Christmas and into January, so profits – which are heavily biased to the second half – will be "significantly below the board's expectations". This prompted broker Peel Hunt to slash its full-year adjusted pre-tax profit estimate from £6.9m to only £5m and cut EPS forecasts from 10.5p to 7.6p.