For the first six months of the fiscal year, Cranswick plc reported strong growth in revenue, while higher costs only dented profitability.
At 1.116 billion pounds (GBP; US$1.345 billion), revenue to the 26-week period to September 24 was more than 12% higher year-on-year. On a like-for-like basis, the increase was 10.7%. At GBP68.4 million, adjusted operating profit was just 1.7% lower than at the same point in 2021. For the latest half-year, statutory profit before tax was GBP61.5 million — 2.7% lower year-on-year.
According to the group’s CEO Adam Crouch, Cranswick made further commercial and strategic progress in what continues to be a relentlessly challenging operating environment.
Recent key investments
In the latest report, Cranswick reports it has invested a total of more than GBP38 million to increase capacity, and further improve efficiencies. Among the facilities to come on-stream over the past six months is a breaded poultry facility in the Hull factory. Furthermore, a third line for cooking bacon is now adding capacity in the same city. Last but not least, the company’s investments in pig production have helped it reach 40% self-sufficiency.
The group also reports progress in terms of sustainability. Its green energy generation has recently received a boost with the approval of six solar panel installations at manufacturing sites. Meanwhile, more of the company’s vehicle fleet is transitioning to clean energy. To cut food waste and provide meals for those in need, Cranswick has become a Leading Food Partner with nationwide charity food redistribution organization, FareShare.
Developments in Cranswick’s business sectors
Covering three processing facilities and the associated pig production units, the Fresh Pork segment accounts for around 25% of Cranswick’s overall revenue. Revenue from the segment was almost 6% higher than the previous period as a result of a margin fall in volume and the effective recovery of rising costs. By employing almost 300 butchers from the Philippines across the group, the firm is no longer experiencing a shortage of skilled workers in this sector. Although still lower than last year, the company reports its pork exports are now picking up.
Cranswick’s sow herd currently runs to around 45,000, producing 24.000 slaughter pigs per week.
Representing 39% of overall revenue is the firm’s Convenience foods segment, which comprises cooked meats and continental deli products. It has generated 13% more revenue than last year, which Cranswick attributes to the growing demand for high-quality meals cooked at home. A project is currently underway to double capacity at one plant serving this segment.
Revenue generated by the Continental Products category — including olives, antipasti and charcuterie products — has grown strongly, Cranswick reports.
Accounting for 16% of group revenue are the Gourmet Products. Including sausages, bacon, and pastry, the segment has generated 19% more revenue than in the comparable period of last year. This is attributed, at least in part, to an increase in production volumes.
Comprising fresh, cooked, and breaded products, the Poultry segment represents 19% of total revenue. It generated a 7.6% increase in sales for the past six months, which is attributed to the launch of new products from the new production facility in Hull. This helped counteract a reduction in cooked poultry products arising from a short factory closure to allow for repair and maintenance work to be carried out.
In January of 2022, Cranswick acquired Grove Pet Foods. Now known as Cranswick Pet Products, this segment contributed 1% of Group revenue during the review period.
More on Cranswick plc
Formed in the early 1970s by farmers in East Yorkshire to produce animal feed, Cranswick has since developed into a producer of range of predominantly fresh foods. These include fresh pork, poultry, convenience, gourmet products and pet food, which the Group supplies to major grocery multiples as well as premium and discounter retail channels. Cranswick also produces “food-to-go,” and reports substantial exports.
Results for the 12 months to March 2022 put the group’ revenue at almost GBP2.01 billion, and pre-tax profit of GBP129.9 million. Revenue contributions by segment were as follows: Convenience, 38%; fresh pork, 26%; poultry, 20%; and gourmet products, 16%.
At its 20 production sites in the U.K., the group had a workforce of the total workforce of more than 13,300 last year.