Wynnstay holds dividend as H1 profit rises

Wynnstay held its dividend as the seller of agricultural products reported an increase in first-half profit and said it was confident about its prospects despite uncertainty created by the Covid-19 crisis.

Pretax profit for the year to the end of April rose 4% to £4.3m as falling commodities prices sent revenue down 12% to £229.3m. Adjusted operating profit rose 8% to £4.8m.

Wynnstay declared an interim dividend of 4.6p a share unchanged from a year earlier. The company said trading would remain under pressure for the rest of the year because of Covid-19 and Brexit uncertainties but that it was financially strong and would continue investing in its business.

Gareth Davies, Wynnstay's chief executive, said: "These resilient results in the face of the headwinds created by the coronavirus pandemic, continuing Brexit uncertainty and subdued farm gate prices, demonstrate the robustness of the business.

"The group is well placed financially and operationally to navigate the ongoing coronavirus crisis. While we expect the remainder of the year to remain challenging, our confidence in the long-term prospects for Wynnstay remain undiminished."

Wynnstay said 60% of its revenue decline was caused by falling commodity prices with the rest the result of lower volumes due to wet weather and Covid-19 restrictions. The company said commodity deflation helped it reduce net debt to £2.54m from £14.7m a year earlier.

The interim dividend "reflects the board's continuing confidence in the underlying business while recognising the broader economic uncertainty", Wynnstay said. Wynnstay shares, down 18% since 1 May, rose 12.5% to 278.4p at 13:18 BST.