Cranswick’s profits drop due to higher costs
Cranswick reported a £5.3m loss in pre-tax profits in the half-year to September 2011, despite a 3% rise in revenue. Profits fell to £18.5m,down from £23.8m at the same period last year. Cranswick chairman Martin Davey said the loss was caused by higher cost, but expressed optimism for the rest of the year.
“As previously reported to shareholders in July 2011, the company faced significant increases in input costs during the first three months of the period. This had a material impact on margins and, despite some recovery during the second quarter, was a key factor in a reduction in interim pre-tax profits to £18.5m from £23.8m a year ago,” he said.
“Trading from July to the end of the period was as anticipated and included the benefit of increased sales, both in the UK and overseas markets. The Board views the remainder of the year with a degree of cautious optimism and this is reflected in the increase in the interim dividend.”
Davey added the company’s continued growth in turnover was due to favourable economic and consumer conditions. “Pig meat products have gained an increased share of the UK retail protein market, with the versatility and low relative price of pork to other proteins finding favour with the consumer,” he said.