Monday, April 28, 2014

News: Confident Crawshaws submit plans for new Rotherham facility


Crawshaws, the Rotherham-based meat focused retailer, has submitted plans for a new manufacturing and distribution facility at Hellaby as it reports increases in both sales and profit.

The Bradmarsh Business Park company has established its recovery in difficult High Street trading conditions, exemplified by the financial results for the year ending January 31 2014.

Total sales for the year were £21m, 12% higher than the previous year (£18.8m). This can be broken down into full year like for like sales that increased by 11% (2013: 3%), plus the introduction of a new market site in Sheffield and a 11% rise in wholesale sales.

EBITDA (earning before taxes) for the year doubled to £1.4m compared to the £0.7m in 2013. The group said that this increase in profitability can be directly attributed to the improvements in like for like sales associated with management control of gross margin and overheads. Both operating profit and profit before tax was £1.0m (2012: £0.3m) and earnings per share rose to 1.42p (2013: 0.31p).

As a result, the board is proposing a dividend a final dividend of 0.43 pence per share.

Richard Rose, chairman of Crawshaw, said in the report: "We believe the excellent quality and value of our core products is driving increases in spend from both existing and new customers.

"Our customers are spending more with us and the improvements in trading performance are spread across most of our stores, giving me much confidence for the future.

"Given the general improvements in trading performance and the reduction in fit out costs the Board are confident that further controlled expansion of our existing shop model will be a key driver of future growth.

"I am delighted to be able to report once again on a continued trading improvement. Like for like sales over the first 12 weeks of the current year are up 19% and gross margin remains strong. I am also encouraged by the initial performance at our new Sheffield store, albeit early days."

Established in 1954, the AIM-listed firm has been trading on the stock market since 2004. It was acquired by Felix Group plc in 2008. It has 21 retail outlets throughout Yorkshire, Lincolnshire, Nottinghamshire and Humberside and two distribution centres, in Rotherham and Grimsby.

A planning application has recently been submitted for alterations at Sandbeck Industrial Estate, Sandbeck Way, Hellaby that would allow Crawshaw to occupy a 12,000 sq ft unit for the manufacture and distribution of specialist foods utilising the existing facilities that were previously occupied by Buxton Foods.

The plans also include the formation of a new entrance to the front elevation of the property to create a trade shop.

Plans state that bringing the empty unit back into use would create "20-30 employees in the first instance to support a successful and expanding national food producer and retailer."

Manned with skilled butchers, Craswhaw stores specialise in traditional raw meats and hot and cold cooked food. Average spend per retail customer is up 13% versus the previous year due to competitive pricing via a focus on larger value packs and multi buy offers, slightly offset by a 1% reduction in customer numbers which is wholly driven by the VAT changes on the hot cooked product offer. Customer numbers for raw meat products are up over 10% on the previous year.

Expansion plans had been scaled back as the group was hit by its key customers - hard pressed families and pensioners - struggling to make ends meet. Crawshaw also felt the impact of reduced footfall in the high street and the government's "Pasty Tax" on hot food.

One of the risks previously associated with the new store roll out was the high cost of capital investment. Over the last year, Crawshaw has spent time working with contractors to simplify layouts and equipment specifications where possible. This has resulted in a significant reduction in fit out costs and so enhanced potential returns. Its latest store opened on The Moor in Sheffield (pictured) in March.

Crawshaw website

Images: Crawshaws / Facebook


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