You can't call Cranswick 's (CWK) £34m capital expenditure ham-fisted, as it has ensured the pork producer can cope with a flurry of new orders. Capacity at Benson Park, the chicken producer it bought in 2014, was doubled during the period and the group "could not have delivered last Christmas without it", according to finance director Mark Bottomley. He added business wins had been above average and its decision to invest - particularly in its cooked meats division and in upping its sausage-making capacity - leaves it well placed to deal with the extra demand.
Every part of the business registered sales growth, with the only exception being the cooked meats division. But Mr Bottomley said he would be "very surprised" if it was down again given volumes turned positive in the final quarter and a new contract will be fulfilled here. The group did pencil in a £4.6m goodwill impairment due to the loss of a sizeable contract within its small sandwich division. Thankfully, another substantial business win has already replaced it.
Analysts at Liberum upgraded their expectations and now predict adjusted pre-tax profit of £73.4m in the year to March 2017, leading to adjusted EPS of 117.9p, compared with £65.7m and 104.7p in FY2016.
| CRANSWICK (CWK) | ||||
|---|---|---|---|---|
| ORD PRICE: | 2,307p | MARKET VALUE: | £1.15bn | |
| TOUCH: | 2,321-2,324p | 12-MONTH HIGH: | 2,600p | LOW: 1,534p |
| DIVIDEND YIELD: | 1.6% | PE RATIO: | 25 | |
| NET ASSET VALUE: | 739p* | NET CASH: | £17.8m | |
| Year to 31 Mar | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 0.82 | 48.4 | 78.6 | 28.5 |
| 2013 | 0.88 | 47.3 | 74.9 | 30.0 |
| 2014 | 0.99 | 54.8 | 88.7 | 32.0 |
| 2015 | 1.00 | 52.8 | 84.1 | 34.0 |
| 2016 | 1.07 | 58.7 | 91.5 | 37.5 |
| % change | +7 | +11 | +9 | +10 |
Ex-div: 30 Jun Payment: 2 Sep *Includes intangible assets of £139.7m, or 280p a share | ||||
