Agriculture, food and engineering group Carr’s Milling looks set to achieve its aim of becoming the UK leader in dairy cattle nutrition after huge demand for its new patented protein feed.
The Carlisle-based company offers a range of services including farm machinery, feed blocks for livestock and a UK network of rural stores, as well as a facility footprint covering the UK, Europe and North America, supplying customers in 31 countries.
Its US feed blocks for livestock were particularly profitable after bad weather in the region earlier this year.
Carr’s released an interim management statement this morning in which its said that its financial position and trading across all divisions in the four months to July 12 remains consistent with the board’s expectations.
Chief executive Tim Davies said: “The growth in sales of the AminoMax UK product is as a result of a significant uplift in demand from the group’s dairy customers, who realise the benefits of the patent-protected rumen-bypass protein product. This increase in sales supports the group’s ambition of becoming the UK leader in dairy nutrition.
“Global demand for Carr’s feed blocks continues, with increased recognition of the brands ensuring positive underlying growth and further global opportunities remain under constant evaluation.
“Following successful trials, our feed block offering has been expanded to include two innovative new products, manufactured in Germany by Crystalyx GmbH, for the pig and poultry industries throughout Europe.”
He said that Carr’s geographic diversity and continued investment ensured the group was at the forefront of innovation, technology and design and added: “This has resulted in a strong performance across every division during the period. As such, we expect the full-year performance to be in line with our existing expectations.”
Carr’s country store refurbishment programme of the past 12 months has resulted in significant improvements and increased efficiencies, Davies said, with a large range of core country store products available.
And he was pleased with continued progress in Carr’s agriculture division, which was strengthened with the acquisition of Lancashire-based compound feed and retail business Merit (Feeds & Storage) Ltd, which has now been consolidated into the Lancaster Mill and the enlarged Brock branch.
Turning to the food division, Davies said this year’s harvest in the UK was predicted to be large but quality was unknown at this stage. However, with three mills adjacent to ports, Carr’s was well-placed to obtain the best-quality wheat which could then be distributed in the most cost-effective manner.
Food safety and hygiene standards remained a primary concern for customers and investment was continuing in this division in order to maintain Carr’s position at the cutting edge of flour milling efficiency, he said. A new mill at Kirkcaldy has been operational for 10 months and is performing as expected.
On engineering, Davies reported that the company’s new factory in Wälischmiller, Germany, was officially opened at the end of June and feedback from customers, partners and suppliers had been positive.
“Research projects have commenced into the effects of radiation on battery life, as well as advances in motor technology, both of which could be applicable to a range of products manufactured by Wälischmiller. The Demo 2000 development project into the adaptation of the Telbot® for the oil and gas industry, being conducted in conjunction with Shell and Statoil is progressing well in line with our expectations.
“The long-term benefits to Carr’s of our investment are clear and will be leveraged by a new state-of-the-art customer facility at Walischmiller.”
Meanwhile, a contract with BP Shah Deniz for 27 pressure vessels has been expanded further to a value of £8m, and the forward order book at Carlisle-based steel fabrications specialist Bendalls is now full for 2014 and into 2015.
“Chirton Engineering, acquired in April this year, has been successfully integrated into the Engineering division. The full benefits of this acquisition are expected to be realised in the next financial year,” Davies said. “The business will be moved to larger premises next year in order to meet the increasing customer demand.”
The group’s financial position remains strong. Net debt at May 31 was £27.1m up from £25.3m at March 1, the increase being primarily due to the acquisition of North Shields-based Chirton and ongoing capital expenditure.