Carr's upgrades guidance again

Agricultural and engineering group Carr's said on Wednesday that full-year results will be "slightly" ahead of its previous expectations as trading since its interim results in April has been better than expected.

In an update covering the 17 weeks to 30 June, the company said trading is slightly ahead of the expectations set out in April and significantly ahead of the previous year across both agriculture and engineering.

The group said UK agriculture continues to perform well across all areas reflecting improved farm incomes and ongoing confidence over the near term, with feed volumes, retail sales, machinery sales and fuel sales all ahead of the prior year.

In the US, meanwhile, feed block volumes are significantly ahead of the year before as the cattle market continues to recover. In Europe, feed block sales through its joint venture business in Germany, Crystalyx Products GmbH, continue to grow, while sales of feed blocks in New Zealand also continue to build.

Carr's said the strong recovery in its UK manufacturing business continues and order books remain strong, with work ongoing on the significant contract announced in July 2017.

The company remains confident in the prospects of UK agriculture in the near term, but expressed caution given the uncertainty over the nature of the UK's future trade agreements after Brexit.

Chief executive Tim Davies said: "We are pleased to announce a strong performance during the period, across both our agriculture and engineering divisions. We have seen continued improvement in UK agriculture, reflecting improved farm incomes and farmer confidence, and strong feed block sales, both in the UK and internationally. The performance of our rngineering division continues to improve, with recent acquisitions integrating well and further orders continuing to add strength to the order book.

"Trading during the year has continued to improve and we now anticipate that trading for the full year will be slightly ahead of our previous expectations. We remain confident that our investments in acquisitions and research, alongside our international footprint, leave us well positioned for sustained growth."

Shore Capital said it was upgrading its pre-tax forecast by £0.3m to £16m, as it reiterated its 'buy' rating on the stock and highlighted further re-rating potential.

At 1115 BST, the shares were down 5.5% to 156p.