Wednesday, June 28, 2017

News: Crawshaw making progress on transitional plans

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Rotherham-based Crawshaw Group PLC, the fresh meat and food to go retailer, said that it was making good progress following the transformational deal with the 2 Sisters Food Group.

The AIM-listed Hellaby firm announced growth plans in 2015 that included £200m of investment, opening 200 stores and creating 2,500 jobs. It secured new investment in April this year that is expected to enable Crawshaw to restart its accelerated new store opening programme, with an initial focus on factory shop locations.

In April, heads of terms were agreed on a deal for 2 Sisters Food Group founder and chief executive, Ranjit Boparan (and connected party), to invest approximately £5.1m for a 29.9% stake in Crawshaw, with warrants to acquire a further 20.1% of the Group.

The deal, which saw Boparan become an advisor to the Crawshaw Board, also includes an initial three-year supply agreement for Crawshaw to acquire fresh meat and other products from 2 Sisters, one of Europe's largest meat and food producers.

At this afternoon's AGM of Crawshaw Group Plc, Noel Collett, will give a trading and strategic update for the 20 weeks trading to June 18 2017 in the current financial year.

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Following the 2 Sisters deal, Crawshaw said it was "making good progress on the transitional plans and operational synergies that will deliver the expected customer and financial benefits."

Group sales were up 5.1% for the first 20 weeks of the financial year with like-for-like sales down 4.5% for the same period. The trading performance of the business continues to be stable following the improvement in like-for-like sales from the initiatives introduced throughout the estate.

Three factory shops have recently opened and plans are in place to open a further four new shops of this type in the balance of the current financial year from a strong pipeline of potential sites.

Noel Collett, chief executive officer at Crawshaw, said: "We are pleased with the progress we've made and the continued level of stability achieved in the core business against the current backdrop of industry-wide cost pressures and a challenging consumer environment.

"Our new fresh meat factory shops continue to perform well and we are further encouraged by our most recent opening at Crystal Peaks, Sheffield. Our strategic focus for the rest of this year will be to open four more fresh meat factory shops and to ensure that we are maximising the customer and financial benefits of the new supply partnership across the estate."

Operating from 49 stores, turnover for the full year ended January 29 2017 was up 19% at Crawshaw to £44.2m from the £37.1m reported in the previous year. Investing in expansion plans, the group made a loss before tax of £1.4m, an increase on the loss of £0.3m in the previous year.

The group is expecting its cost management measures and margin additive initiatives, together with the expected cost reduction in business rates, to offset a challenging UK consumer outlook.

Crawshaw website

Images: Crawshaw plc


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