Carr’s Group (LSE: CARR)

Last close As at 22/05/2024

GBP1.40

3.00 (2.19%)

Market capitalisation

GBP133m

Carr’s Group’s Speciality Agriculture division serves farmers in the UK, Ireland, the United States, Germany, Canada and New Zealand with feed blocks and feed supplements. The Engineering division offers remote handling equipment and fabrications to the global nuclear and oil and gas industries.

H124 performance was in line with management’s expectations. The Engineering division performed well with revenues of £28.5m (up 26.1%), with robotics being particularly strong (up 60.4%). Operating profit was £2.4m (up 119%), with a margin of 8.4%. Order intake was strong as the order book is currently above the £59.8m record at the end of FY23. The Agriculture division markets remain challenging. Revenues decreased by 7.5% due to both volume (UK +11%; US -18%) and some reversal of price inflation. Operating profit reduced by 17.4% to £4.9m although margins remained positive at 9.8%. Actions are being taken in terms of cost, procurement and growth strategies with benefits being seen in the UK. The US, however, is expected to remain difficult until 2025.

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Sector

Industrials

Equity Analyst

David Larkam

David Larkam

Analyst, Industrials

Key Management

  • David White

    CEO

  • Gavin Manson

    CFO

  • Tim Jones

    Chairman

Balance Sheet

Forecast net debt (£m)

N/A

Forecast gearing ratio (%)

N/A

Share Price Performance

Price Performance
% 1M 3M 12M
Actual 10.2 19.7 (1.8)
Relative 5.5 10.1 (8.8)
52 week high/low 149.8p/93.8p

Financials

Management has announced a new streamlined strategy, which includes selling the Engineering Division and becoming a focused Agricultural supplies group, due to the lack of synergy between the two divisions and the significant central costs of the current structure. This new strategy should result in a streamlined business that is more attuned to investor demands.

Y/E Aug Revenue (£m) EBITDA (£m) PBT (£m) EPS (fd) (p) P/E (x) P/CF (x)
2022A 124.2 13.0 11.2 9.9 14.1 N/A
2023A 143.2 7.1 7.5 6.1 23.0 N/A
2024E 148.9 12.4 8.8 7.4 18.9 N/A
2025E 154.8 14.2 10.6 8.9 15.7 N/A

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