February 2023

Cranswick PLC (ticker: CWK) produces food products to grocery retailers, the food service sector, and other food producers in the UK and internationally.

The company predominantly offers fresh pork, poultry, convenience and gourmet products. 

 The company was incorporated in 1972 and is based in Hessle, United Kingdom

Why did we invest originally?

You can read our full report about our original investment case back in November 2021 here. But here is an overview of Cranswick and why we like it as a company: 

Cranswick plc has become one of the largest food producers in the country, supplying a range of products to both retail and food service customers. Its success is built on its commitment to quality, sustainability, and animal welfare, using only the finest ingredients in its products and has rigorous quality control measures in place to ensure that all of its products meet the highest standards. In addition, Cranswick is committed to sustainability and reducing its impact on the environment, implementing a range of initiatives to reduce waste, minimize energy usage, and support local communities.

Cranswick's product range includes a variety of quality meat products, including pork, bacon, sausages, and ham, as well as a range of artisanal food products such as gourmet sausages, charcuterie, and cooked meats. These products are sold through a variety of channels, including major supermarket chains, independent retailers, and food service customers.

In recent years, Cranswick has expanded its operations beyond the UK, establishing a presence in several key markets in Europe and Asia. The company has also acquired a number of smaller food producers, strengthening its position as a leading food producer and expanding its product range. The company has a long history of steady growth and profitability, and has consistently delivered strong financial results, driven by its commitment to quality and sustainability.

Despite recent decrease in its share price, Cranswick looks to have come through some turbulent market conditions and is returning to growth. Last week the company announced that their revenue growth had accelerated in the third quarter, on the back of strong demand. All four of its product categories were ahead in the UK market in the third quarter to December 24, compared with 2021.

The company noted that December trading was supported by its fresh pork, convenience and gourmet festive products. 

Chief Executive Officer Adam Crouch said, "Our customers and consumers continue to recognise and appreciate the quality, value and versatility of pork. Our core UK market remains extremely resilient as our customers and the UK consumer continue to recognise and appreciate the quality, value and versatility of our pork and poultry product ranges. The broad-based inflationary pressure we are experiencing across our cost base continues to be well controlled and mitigated."

Cranswick added that poultry revenue growth in the third quarter indicated a ‘positive contribution’ from its new breaded poultry facility in Hull, which offset lower sales from its cooked poultry facility.

The company also noted that Avian Influenza had a limited impact on fresh poultry revenue early in the third quarter, with outbreaks at five farms in Cranswick’s poultry estate. Cranswick said it has received full financial compensation for all lost birds, and continues to enforce biosecurity protocols.

Cranswick also said that Far East export sales were well ahead compared to the year before, with ‘significantly stronger pricing’, while its pet products line also added a ‘modest contribution’ to revenue in the third quarter.

Their current financial year is set to be in line with the board’s expectations.

Another thing we love about Cranswick is that they have increased their dividend for 32 consecutive years - an incredible display of reliability. 



Conclusion

Cranswick are a long-standing, consistent company with a history of strong finances and dividend growth. The last couple of years have seen some turbulent market conditions, meaning the share price has decreased. Recent statements and financial reports suggest CWK is returning to growth. We want to take advantage of a low entry point and will be adding to our investment tomorrow morning. 

RETURNS TABLE  

Month Company Ticker Symbol Purchase Date Current Stock Price (p) Dividend Yield To Date (%) "Amount Regular Monthly Investment (£) Purchase Price (p) Sold? Dividend Income (£)
February 2021 Hikma Pharmaceuticals PLC HIK 01/02/21 1733.50 3.52% £0.00 £1,657.54 2408.97 No £58.31
March 2021 Sylvania Platinum Ltd SLP 01/03/21 106.73 15.07% £0.00 £1,077.77 120.85 Yes £162.46
April 2021 Plus500 Ltd PLUS 06/04/21 1685.07 5.29% £0.00 £1,717.48 1438.50 Yes £90.81
May 2021 Capital Drilling Ltd CAPD 04/05/21 95.43 5.22% £0.00 £1,587.89 69.00 Yes £82.95
June 2021 Kingfisher PLC KGF 01/06/21 286.80 6.94% £0.00 £1,254.37 337.00 No £87.02
July 2021 Ultra Electronics Holdings PLC ULE 05/07/21 3216.87 0.68% £0.00 £1,423.50 2327.08 Yes £9.72
August 2021 H&T Group PLC HAT 02/08/21 337.50 1.44% £0.00 £355.53 278.20 Yes £5.11
September 2021 Rio Tinto PLC RIO 06/09/21 6128.00 10.63% £0.00 £1,804.58 5414.00 No £191.84
October 2021 Redrow PLC RDW 04/10/21 536.00 8.14% £0.00 £884.27 655.73 No £72.01
November 2021 Cranswick PLC CWK 01/11/21 3266.00 2.74% £0.00 £1,676.78 3453.00 No £45.94
December 2021 BAE Systems PLC BA 06/12/21 742.40 2.70% £0.00 £2,643.10 554.00 Yes £71.43
January 2022 Jersey Electricity PLC JEL 04/01/22 500.00 2.83% £0.00 £2,096.48 627.00 Yes £59.28
February 2022 Hikma Pharmaceuticals PLC HIK 01/02/22 1733.50 1.99% £0.00 £2,019.97 2064.00 No £40.13
March 2022 Bellway PLC BWY 01/03/22 2201.00 8.79% £1,923.92 £1,141.81 2885.90 No £269.49
April 2022 Tyman PLC TYMN 04/04/22 265.50 4.07% £423.63 £2,515.61 320.00 No £119.60
May 2022 Tesco PLC TSCO 03/05/22 246.40 6.87% £848.76 £3,527.96 273.14 No £300.58
June 2022 Redrow PLC RDW 06/06/22 536.00 5.11% £0.00 £1,718.37 517.00 No £87.73
July 2022 Rio Tinto RIO 04/07/22 6128.00 4.63% £0.00 £1,668.17 4830.00 No £77.27
August 2022 Pets at Home PLC PETS 08/08/22 376.00 1.34% £2,026.25 £1,300.73 332.70 No £44.65
September 2022 Capital Drilling Ltd CAPD 05/09/22 95.43 0.90% £0.00 £848.82 84.60 Yes £7.66
October 2022 Kingfisher PLC KGF 03/10/22 286.80 1.75% £0.00 £1,293.33 217.18 No £22.66
November 2022 Pan African Resources PLC PAF 07/11/22 16.54 1.92% £0.00 £1,711.83 17.00 No £32.90
December 2022 Future PLC FUTR 05/12/22 1749.00 0.00% £1,491.34 £1,592.77 1397.00 No £0.00
January 2023 PayPoint PLC PAY 09/01/23 500.00 0.00% £3,761.79 £713.30 510.00 No £0.00

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