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Cranswick says 50% rise in pig feed prices being 'well managed'

Published: 03:28 24 May 2022 EDT

Cranswick PLC -

Cranswick PLC (LSE:CWK) beat profit forecasts for the past year despite rising raw material prices, supply chain disruption and lower demand from Asia hitting pork sales.

The price of cereals, which represent 60%-70% of the cost of growing a pig, increased by over 50% in the immediate aftermath of the start of the war in Ukraine, though the company said it has partially reflected these higher input costs in prices paid to farmers.

Pork revenue fell 7.9% due to lower average UK pig prices during the year, though sales in its convenience, gourmet and chicken wings all rose. 

After an internal inspection identified the presence of salmonella in some cooked chicken products earlier this month, leading to customers being asked to withdraw products containing, the FTSE 250-listed group said the cost of the issue "cannot yet be reasonably estimated" but is not expected to have a material impact.

The meat producer reported adjusted profit before tax of £136.9mln for the 52 weeks ended 26 March 2022, up 5.6% on the prior year and slightly ahead of analyst estimates, as revenue rose 5.8%.

The full year dividend was increased 8% to 75.6p.

Chief executive Adam Couch said: “Trading in the new financial year has been in line with the board's expectations. Notwithstanding the challenging operating conditions we continue to experience, our outlook for the group for the current year is unchanged.”

Growth in poultry sales followed the successful capacity expansion at its Eye facility in Suffolk, while new plants to make cooked bacon and breaded poultry in Hull were successfully commissioned either side of the year end.

Shares in the company jumped 5% to 3330p on Tuesday morning. 

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