The chief executive of major agriculture, food and engineering group Carr’s yesterday said its £17 million investment in a new flour mill in Fife was starting to pay significant dividends.
Tim Davies said the Kirkcaldy mill had delivered a step change in the financial performance of the firm’s food division.
Figures for the 26 weeks to March 1 show a profit of £1.03m, more than double than £448,000 achieved during the same period last year.
The outcome also represents significant progress from the £559,000 the division made during the full-year period to August 31.
Mr Davies said he expected the food operation to make further progress as the Kirkcaldy mill bedded down against the backdrop of a strong harvest.
“The new flour mill at Kirkcaldy, which commenced production in September 2013, consolidated our position as the leading miller in Scotland,” Mr Davies said.
“It is the world’s most technologically advanced mill, designed jointly by our own project team and the Swiss engineers Buhler.
“This important and complex project is already delivering both operational and commercial benefits.
“These benefits will continue to grow during the remainder of the financial year and the division is expected to meet its planned level of financial performance.
“The flour business continues to focus on producing quality flour to meet the ever-increasing technical and food safety standards of our customers.
“We continue to invest in flour technology to ensure operational efficiencies and service our customer requirements.”
Overall, the group saw a 2% increase in pre-tax profits in the first half of the year despite revenues falling to £214.7m, a £16.9m drop on the £231.6m of the year previous.
The firm said its agricultural divisions had performed well in the period, with differing weather conditions on either side of the Atlantic both helping and hindering the business.
Carr’s said the severe weather seen in the US had pushed demand for its feed blocks to record levels, but a mild winter had led to a decline in sales of fuel and heating oil and animal feed and feed blocks in the UK.
The company also said its engineering business had received a number of orders for work through to the end of next year on the back of a major investment programme which had seen it establish a new £4.5m production and office facility in Markdorf, Germany.
Mr Davies said the first-half performance was in line with expectations and demonstrated the strength of the group’s diverse operational base.
“I have been encouraged by the performance of the business during the first six months, with each division making a solid contribution,” Mr Davies said.
“The second half of the year has started well and the board expects to deliver a full-year performance in line with its current expectations.”
Shares in Carr’s which last week announced the potential £5.3m acquisition of Chirton Engineering, a specialist business which counts supercar maker McLaren among its customer base closed the day up 6p at 1,686p yesterday.