Cranswick's (CWK) capital expenditure hit a record £59m in the year to March, with around half allocated towards the new Continental Foods facility in Lancashire. The increased capital commitment reflects the food producer’s drive to add capacity, which analysts believe will raise spending to £80m in both 2019 and 2020. That's unsurprising given that a new poultry site in Suffolk, which recently received planning approval, should cost around £70m – hardly chicken feed, but finance director Mark Bottomley expects the new site to double Cranswick’s capacity in poultry production from the end of next year.
Cranswick has spent a total of £270m on developing its infrastructure over the past eight years, and this investment appears to be paying off. Adjusted operating profit increased by more than a fifth to £92.8m thanks to volume growth across all four divisions, while there was a 22 basis point improvement in the underlying margin as input costs eased during the second half.
Analysts at Shore Capital expect pre-tax profit of £95.3m in the year to March 2019, giving EPS of 150p, compared with £92.4m and 145p in FY2018.
| CRANSWICK (CWK) | ||||
| ORD PRICE: | 3,420p | MARKET VALUE: | £1.75bn | |
| TOUCH: | 3,418-3,428p | 12-MONTH HIGH: | 3,466p | LOW: 2,703p |
| DIVIDEND YIELD: | 1.6% | PE RATIO: | 25 | |
| NET ASSET VALUE: | 939p* | NET CASH: | £20.6m | |
| Year to 31 Mar | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2014 | 0.99 | 54.8 | 89 | 32.0 |
| 2015 | 1.00 | 52.8 | 84 | 34.0 |
| 2016 | 1.02 | 62.1 | 92 | 37.5 |
| 2017 | 1.25 | 77.5 | 124 | 44.1 |
| 2018 | 1.46 | 88.0 | 138 | 53.7 |
| % change | +18 | +14 | +11 | +22 |
| Ex-div: | 19 Jul | |||
| Payment: | 7 Sep | |||
| *Includes intangible assets of £156m, or 306p a share | ||||
