The recovery in both US feed block sales and the UK manufacturing businesses noted at Carr’s Group's (LON:CARRC) AGM in January has continued throughout H118. This has resulted in a 22% improvement in adjusted PBT year-on-year and a slight over-performance compared with management’s expectations. H218 has started well, so we raise our estimates and adjust our indicative valuation from 167p/share to 169p/share.
Improved performance in both divisions
The positive trends noted at the AGM in January continued for the remainder of H118. Group revenues rose by 13.2% year-on-year to £200.1m. This reflected a recovery in the US feed block activity linked to an improvement in cattle prices and in the UK manufacturing businesses, as work progressed on the major contract that had been delayed right until the end of FY17. In addition, sentiment in the UK farming sector continued to be positive and the remote handling businesses benefited from strong order books relating to the global nuclear industry. Pre-exceptional PBT grew by 22.0% to £10.9m. The integration of NuVision, the US engineering company acquired in August 2017, is progressing well.
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