Much of the pain suffered by Carr’s (CARR) during the year to September was well flagged before the release of this set of numbers. Lower cattle prices in the US and a delay in one of its major engineering contracts resulted in a reduction in underlying operating profits of more than a quarter year on year. The good news is that both the agriculture and engineering businesses experienced signs of recovery during the latter half of the year, while manufactured feed volumes in the UK were up 10.9 per cent.
Lower demand for feed block resulted in a 4.1 per cent decline in US sales volumes. However, product trials in South America are expected to complete by the end of the financial year, while its new low moisture feed block plant in Tennessee is expected to be fully operational by the end of December. The latter will provide access to the lucrative Eastern and South Eastern states.
Continuing budgetary pressures within oil and gas markets meant the UK manufacturing business was unable to offset its large contract delay. However, progress was made with expanding into new markets via the $11.5m (£8.8m) acquisition of US-based NuVision Engineering, providing access to the nuclear sector. The group also bought remote handling business STABER GmbH, which it plans to integrate with its existing business Walischmiller.
Analysts at Whitman Howard expect operating profits of £12.1m for the year to September 2018, giving adjusted EPS of 10.7p (from £9.3m and 7.7p in 2017).
| CARR'S GROUP (CARR) | ||||
| ORD PRICE: | 146p | MARKET VALUE: | £133m | |
| TOUCH: | 142-146p | 12-MONTH HIGH: | 157p | LOW: 107p |
| DIVIDEND YIELD: | 2.7% | PE RATIO: | 19 | |
| NET ASSET VALUE: | 100p* | NET DEBT | 13% | |
| Year to 2 Sept | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2013 | 468 | 15.4 | 12.0 | 3.2 |
| 2014 | 429 | 16.6 | 12.8 | 3.4 |
| 2015 | 331 | 13.7 | 10.0 | 3.7 |
| 2016** | 315 | 14.1 | 10.7 | 3.8 |
| 2017 | 346 | 10.0 | 7.7 | 4.0 |
| % change | +10 | -29 | -28 | +5 |
| Ex-div: | 14 Dec | |||
| Payment: | 12 Jan | |||
| *Includes intangible assets of £26m, or 29p a share **Excludes special dividend of 17.54p a share, paid in October 2016 | ||||
