Norish plc Preliminary results 2017

Wednesday, 28th March 2018


Norish plc (AIM: NSH), is pleased to announce its preliminary results for the year ended 31 December 2017.

Financial Highlights

  • Total revenue increased by 31.5% to £42.3m (2016: £32.1m)
  • Revenue from the Cold Store division increased by 13.3% to £14.3m (2016: £12.6m)
  • Revenue from the Sourcing division increased by 41% to £27.4m (2016: £19.5m)
  • Operating profit for the Group increased by 96% to £1.71m (2016: £0.87m)
  • Profit before tax increased by 138% to £1.5m (2016 : £0.6m)
  • Diluted adjusted Eps increased by 140% to 3.6p (2016 : 1.5p)
  • Dividend increased by 10% to 1.65 €cent (2016: 1.50 €cent)
  • Net debt was £5.4m at year end (2016: £5.2m)

Operational Highlights

  • Cold stores comprise, by far the greatest proportion of our capital employed. This division recorded sales growth of 13.3%, when compared with 2016. Divisional contribution increased from £2.1m to £3.3m
  • The North West Cold store division recorded sales growth of 15.9% and contribution growth of 85% in 2017, compared to the prior year. The South East Cold store division recorded sales growth of 10.8% and contribution growth of 28.5% on the same basis. This growth, at both divisions, is the result of a combination of increased volumes, improved profile of work and improved pricing.
  • The contribution of Town View Foods which is a Protein Sourcing business, was ahead of the last year, with sales growth of 29% and contribution ahead by 12%.
  • Our start-up businesses, including dairy and Foro International Connections Limited generated a combined loss of £0.3m in 2017. We expect both businesses to be profitable in 2018.


Cold Store Division

The North West cold store division which comprises the freehold sites at Wrexham and Birmingham performed strongly in 2017, reflecting a combination of increased intakes, greater blast freezing volumes, improved pricing with an increasing focus on costs, particularly towards the back end of the year.

The South East division, which comprises the sites at Bury St. Edmunds (freehold), Braintree (leasehold), Gillingham (long term leasehold at a peppercorn rent) and East Kent (leasehold) performed ahead of the same period last year. Within the mix Bury saw strong growth in profitability, albeit from a low base, which helped overall divisional performance. Sales in the South East increased by 10.8%, reflecting higher intakes and greater blast freezing volumes.

Sourcing Division

Our Sourcing division which was previously known as the Commodity division consists of Town View Foods Limited and Foro International Connections Limited. Sales for the division accounted for £27.4m and £19.5m last year. The division contributed £0.53m for the period unchanged from the same period last year.

Town View Foods Limited accounted for sales of £23.8m, against £18.5m last year. It contributed £0.62m for the period, up from £0.56m for the same period last year. Town View Foods sources protein products mainly beef, pork, lamb and chicken. Sales from pork and chicken increased by £3.7m during the period, while sales from beef and lamb increased by £1.6m.

Foro International Connections Limited trades in the sale of juice to the ready to drinks market along with other retail goods. Sales increased to £3.5m from £1m. It recorded a loss of £0.1m against a breakeven in 2016.


The dairy division continues to make progress. We have completed our capital investment phase in the business - we now have a high quality leased asset which should deliver attractive returns on capital out over the next decade and beyond. Our asset utilization and operational efficiency will continue to improve as we build our dairy herd at Cantwellscourt Farm, through 2018. Our 2018 Spring calving experience has been very good with all key KPI’s delivered on.


During the period we invested £1.8m (2016: £1.7m), £1.3m in the dairy farm in Kilkenny and £0.5m in routine capital expenditure in the cold store division.


We anticipate another strong year of profit growth in 2018, underpinned by the initiation of a continuous improvement programme across the business.

In our Cold Store Divisions , both our North West and South East Divisions have delivered profit growth in the first two months of 2018. We are actively engaged in programmes to both control and, where appropriate reduce costs.

Despite the current volatility in its underlying markets, our protein sourcing division had a good start to the year. We are confident that its low risk operating model can continue to deliver in line with expectation.

Our dairy farming division is expected to increase asset utilisation and operational efficiency in 2018 as we build our herd at Cantwellscourt Farm. Our Spring calving experience in 2018 has been very good with all key KPIs delivered on. We believe our dairy business has significant scope to grow from its existing asset base but also via adjacent opportunities along the value chain in the years ahead.

We expect the group's cash conversion metrics to continue to improve through 2018, driven by an improved operating performance, lower tax rate and reduced capital expenditures.

Financial Review

Total equity at 31 December 2017 stood at £16m (2016: £15.3m). Net debt at 31 December 2017 was £5.4m compared to £5.2m at 31 December 2016.


The board recommends the payment of a final dividend of 1.65€cent per share. This will be paid on 19 October 2018 to those shareholders on the register on the 28 September 2018. It will bring the total dividend in respect of the financial year to 1.65 €cent per share, against 1.50€cent per share last year, an increase of 10%.


The United Kingdom is due to leave the EU on the 29 March 2019. It is difficult to pin point any direct impacts from the ongoing Brexit discussions other than to say they are hardly positive for business generally. However, our balance sheet is in good shape and leaves us well positioned to benefit from any disruption and consequent opportunity which may arise.

On behalf of the board, I would like to thank the management team and staff for their commitment and contribution in 2017.

Ted O’Neill







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