Wynnstay Group Plc
(“Wynnstay” or the “Group” or the “Company”)
Final Results
For the year ended 31 October 2021
Record results;
Group is well-positioned for the year ahead
KEY POINTS
Financial
- Record results, benefiting from:
- improved farmer sentiment post Brexit, strong farmgate prices and exceptional gains from fertiliser blending activities
- Revenue up 16% to £500.39m (2020: £431.40m), including significant commodity price inflation
- Underlying pre-tax profit* up 37% to £11.44m (2020: £8.37m) /Reported pre-tax profit increased to £10.99m (2020: £6.98m after £1.2m of non-recurring items)
- Basic earnings per share up 60% to 44.40p (2020: 27.73p including non-recurring items)
- Net cash up 10% to £9.24m (31 October 2020: £8.42m)
- Net assets up 8% to £105.72m/£5.25 per share (31 October 2020: £98.18m/£4.92 per share)
- Proposed final dividend of 10.50p (2020: 10.00p); total dividend up 6% to 15.50p (2020: 14.60p).
- Eighteenth consecutive year of dividend increases.
Operational
- Agriculture Division – revenue up 19% to £358.96m (2020: £302.58m), operating profit contribution up 47% to £4.22m (2020: £2.88m)
- total feed volumes 6.5% ahead year-on-year. After higher production and distribution costs, operating profit was in line with prior year
- arable activities benefited from a return to more normal harvest tonnages and yields and a good autumn 2021 planting season
- outperformance from Glasson, benefiting from three-fold price increase across the market in fertiliser raw material prices in H2
- Specialist Agricultural Merchanting Division – revenue up 10% to £141.43m (2020: £128.81m) operating profit contribution up 24% to £7.15m (2020: £5.78m)
- excellent performance reflected increased farmer confidence and return to farm investment
- strong sales across all major product categories, including bagged feed and hardware
- Two bolt-on acquisitions, acquired in Q2 2021, have integrated well, added new customers, and expanded trading area
- New digital trading portal launched in H1; steady adoption from customers as expected
- Investment programmes to increase manufacturing and processing capacity progressed well
- Non-executive Board appointment and key senior management appointments made, including, Commercial Sales & Marketing Director, Group Engineering Manager and Environmental & Sustainability Manager
Outlook
- Trading in new financial year has started in line with expectations, and Group is well positioned to achieve its growth objectives for the year
* Underlying pre-tax profit is a non-GAAP (generally accepted accounting principles) measure and is not intended as a substitute for GAAP measures and may not be calculated in the same way as those used by other companies. Refer to Note 15 for an explanation on how this measure has been calculated and the reasons for its use.
Gareth Davies, Chief Executive of Wynnstay Group plc, commented:
“These record results reflect the significantly improved trading environment as well as our initiatives to drive growth, productivity and efficiency. Strong farmgate prices and the lifting of uncertainties around Brexit and future financial support have promoted a return to farm investment. Results also benefited from a strong second half across the Group, especially for our arable operations. The 2021 harvest was good, with tonnages and yields reverting to more normal levels, and our fertiliser blending activities generated a windfall gain in a highly disrupted marketplace.
“Trading in the new financial year has begun well, in line with our expectations. We have a clear growth plan with strategic investment programmes under way, and new opportunities. While there are challenges with rising costs, we are confident that Wynnstay is well-positioned to achieve its growth objectives for the year, and view prospects for continuing development very positively.”