Cranswick cost pressures eat into profit

published 14 November 2011

UK pork products supplier Cranswick served up a 3% increase in half year revenue while profits succumbed to input cost pressures.

East Yorkshire-based firm said it remains cautiously optimistic about the remainder of the year in what has been and remains a "testing economic and consumer environment."

Revenues increased to £393.9m in the six months ended 30 September 2011from £384.3m the month before. Underlying revenues increased 6%. Pre-tax profit fell to £18.5m from £23.8m a year earlier after margins were squeezed.

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The significant increases in input costs during the first three months of the period was a key factor in a reduction in interim pre-tax profits to £18.5m, Cranswick explained.

However chairman Martin Davey said he was pleased to report continued growth in turnover.

"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."

Cranswick said trading from July to the end of the period was as expected and it views the remainder of the year with a degree of cautious optimism, which is reflected in the increase in the interim dividend to 9p from 8.8p previously.