Cranswick Plc · LSE:CWK
Cranswick — Investor Day (March 2022)
46 slides from Cranswick's investor day presentation, Mar 24, 2022
Slide 1: Capital Markets Day and Cranswick Poultry Site Visit
C A P I TA L M A R K E T S DAY A N D C R A N S W I C K P O U LT R Y S I T E V I S I T 24 MARCH 2022
Slide 2: Disclaimer
DISCLAIMER: Certain statements in this presentation are forward looking statements. By their nature, forward looking statements involve a number of risks, uncertainties or assumptions that could cause actual results or events to differ materially from those expressed or implied by those statements.
Slide 3: Agenda
AG E N DA 09:30 Coffe e a nd ba con s a nd w ic hes 10:00 We l com e Tim S mith C B E , Cha ir ma n 10:1 0 Cra nsw ic k ove r v iew Ad a m Co uc h , Ch ief Exec utive O ffi ce r Ma r k Botto mley, Chief Fin a nc ia l O f f i ce r 10:35 Investing for g row th Ch r is Ald ers ley, Ch ief Op e ra ting
Slide 4: Cranswick Group Overview
C R A N S W I C K G R O U P OV E R V I E W A DA M C O U C H , C H I E F E X E C U T I V E O F F I C E R M A R K B OT TO M L EY , C H I E F F I N A N C I A L O F F I C E R 4
Slide 5: Supporting the refugee crisis whilst managing business impacts
SUPPORTING THE REFUGEE CRISIS W H I L S T M A N AG I N G T H E B U S I N E S S I M PAC T S H U M A N I TA R I A N S U P P O R T I N F L AT I O N A N D C O M M O D I T I E S Providing additional support to our permanent Ukrainian Working with customers and suppliers colleagues with family still in Uk
Slide 6: Trading Update
T R A D I N G U P DAT E Trading remains in line with expectations Second Nature progress continues Acquisition of Grove Pet Foods announced UK pork sector backlog reducing Inflation managed proactively with customers Monitoring Ukraine situation and forward commodity view FINANCIAL CALENDAR Financia
Slide 7: Over the last five years we have delivered
OV E R T H E L A S T F I V E Y E A R S W E H AV E D E L I V E R E D OPERATIONAL PERFORMANCE GROWTH THROUGH ENHANCED OUR INCREASED OUR PIG INCREASED POULTRY ACQUISITION 1 FIXED ASSETS BASE 2 PROCESSING OPERATIONS 1 FARMING OPERATIONS 1 £120m invested in Over £350m of Increased from From 0.5m to 1.4m
Slide 8: Our long-term trading record
O U R L O N G -T E R M T R A D I N G R E C O R D 1990 – 2021 £1,898m £1,898m 129.7 DIVIDEND PER SHARE (pence) [128.6] ADJUSTED PROFIT BEFORE TAX 1 (£M) 70.0 70.0 60.4 60.4 102.3 102.3 £1,667m £1,667m 92.0 90.2 90.2 92.0 31 YEARS OF UNBROKEN DIVIDEND GROWTH 55.9 55.9 53.7 53.7 75.5 75.5 44.1 44.1 64.
Slide 9: Our growth history
O U R G R OW T H H I STO RY 19 75 1985 1991 1992 1992 1 9 95 1999 2 0 01 2 0 04 2 0 05 Established Move into food Preston George Bucktons FT Sutton’s Deli Simply Sausages Pethick & Co – Continental Jack Scaife’s Perkins Agri-Food business production abattoir Pet Food Cooked Meats – Gourmet Sausage C
Slide 10: Understanding Cranswick
U N D E R S TA N D I N G C R A N S W I C K OUR PURPOSE Feeding the nation with authentically made, sust ainably produced food ; created with passion REASONS TO BELIEVE Traditional , artisanal craf t , upscaled through industr y leading food production BRITISH A U T H E N T I C A L LY COMMITTED ENTRE
Slide 11: Our ways of working
O U R WAY S O F W O R K I N G OUR GUIDING PRINCIPLES QUALITY VALUE INNOVATION PEOPLE Delight the customer Vertical integration Product Attract Own premium Utilisation Packaging Engage Technical excellence Efficiency Process Empower M A K I N G M E AT S U S TA I N A B L E S T R AT E G I C E N A B L E
Slide 12: A broad product portfolio
A B R OA D P R O D U C T P O R T F O L I O Fres h Po r k Gourmet Sausage Gourmet Bacon & Gammon Slow Cook Fresh Chicken R e a d y To E a t C h i c k e n Coated Chicken Gourmet Pastr y Cooked Meats Charcuterie Olives & Antipasti Pet Fo o d 12
Slide 13: Our strategy and growth agenda
O U R S T R AT E GY A N D G R O W T H AG E N DA C O N S O L I DAT I O N D I V E R S I F I C AT I O N I N T E R N AT I O N A L G ROW TH M A R K ET S DR I VE TH E CO RE MAXIMISE RETURNS & A D D E D VA LU E Farm to fork capability Invest in growth markets Maximise fifth quarter returns Maximise scale &
Slide 14: Our most recent acquisition
O U R M O S T R E C E N T AC Q U I S I T I O N Acquisition of Grove Pet Foods completed on 28 January 2022 Opportunity to add value to fifth quarter and offal from pig and poultry processing Produce wide range of dried pet foods and treats under the Vitalin and Alpha brands Contract manufacture for
Slide 15: Investing for growth
I N V E ST I N G F O R G R OW T H C H R I S A L D E R S L E Y , C H I E F O P E R AT I N G O F F I C E R 15
Slide 16: Since our last Capital Markets Day
S I N C E O U R L A S T C A P I TA L M A R K E T S DAY T H R E E N E W FAC T O R I E S A N D A T O TA L O F £ 1 4 9 M I N V E S T E D F R E S H P O U LT R Y , E Y E G O U R M E T K I TC H E N , H U L L P R E PA R E D P O U LT R Y , H U L L N OV E M B E R 2 0 1 9 APRIL 2021 APRIL 2022 UK’s most effic
Slide 17: Farm to fork
FA R M T O F O R K A U N I Q U E V E R T I C A L LY I N T E G R AT E D , H I G H W E L FA R E , S U P P LY C H A I N Fresh Pork Retail Wholesale Convenience Cooked Meats Slow Cook Mediterranean Food Gourmet Products Sausage Bacon Pastry Poultry Wholesale Fresh Chicken Cooked Poultry Animal Feed Pet
Slide 18: Our pig farming operations
O U R P I G FA R M I N G O P E R AT I O N S O U R AC Q U I S I T I O N O F E A P I N 2 0 1 3 S AW U S R E S TA R T P I G FA R M I N G O P E R AT I O N S A N D W E N O W P R O D U C E OV E R 3 0 % O F O U R T O TA L R E Q U I R E M E N T Based in Yorkshire and the Midlands Based in East Anglia Based
Slide 19: Our locations
O U R L O C AT I O N S W E H AV E S I T E S AC R O S S T H E U K A N D O U R P R I M A R Y P R O C E S S I N G FAC I L I T I E S A R E W E L L P L AC E D W I T H I N K E Y FA R M I N G A R E A S OVER 13,000 EMPLOYEES OPERATING IN 20 FACILITIES OVER £350M CAPITAL INVESTMENT IN THE LAST 5 YEARS 14 SIT
Slide 20: Investing strategically
I N V E S T I N G S T R AT E G I C A L LY EFFICIENCY & C A PA B I L I T Y C A PAC I T Y S U S TA I N A B I L I T Y LABOUR REDUCTION All capex projects assessed against at least one of the key objectives Partnership approach with key suppliers to develop industry leading infrastructure Forward capex
Slide 21: Cranswick Poultry
C R A N S W I C K P O U LT R Y C R E AT I N G VA L U E F R O M FA R M T O F O R K B A R R Y L O C K , M A N AG I N G D I R E C T O R , CRANSWICK EAST ANGLIA 21
Slide 22: Significant growth opportunities for Cranswick
S I G N I F I CA N T G R OW T H O P P O RT U N I T I E S F O R C R A N SW I C K CHICKEN CONSUMPTION THE UK MARKET STRUCTURE FO R ECA ST TO CO N T I N U E UK consumption ahead of global and EU average 21m Av e r a g e b i r d s processed per week 2N D LARGE ST PRODUCE R IN EUROPE 12% of production 24
Slide 23: Our poultry journey
O U R P O U LT R Y J O U R N E Y OV E R £ 2 2 0 M I N V E S T E D O N AC Q U I S I T I O N S A N D I N F R A S T R U C T U R E 2 01 4 2 016 2 01 9 BENSON PARK CROWN CHICKEN EYE PROCESSING Premium cooked poultry Vertically integrated supply chain World class processing facility Foodservice focus 0.5m
Slide 24: Feed mills
FEED MILLS S U S TA I N A B L E F E E D C A PA B I L I T Y Zero deforestation soya Two feed mills @ Kenninghall and Hoxne Reduction of soya in the diet 7,500 tonnes of feed per week Alternative protein sources Supplying 100% Cranswick chicken feed and 10% of Wayland Farms feed requirements 24
Slide 25: Farms
FA R M S OV E R V I E W NEST BORN 100% company operated farms Revolutionary on farm hatching system 80% of the farms within 30 miles of the site Focus on broiler welfare and sustainability Better chicken commitment trial underway Instant access to food and water 25
Slide 26: Primary processing
PRIMARY PROCESSING OV E R V I E W EFFICIENCY Q UA L I T Y Purpose built state-of-the-art facility Automated crates – Atlas handling system Kill to pack in 3.5 hours 1.4m weekly kill Fully automated evisceration and offal harvesting Fully automated (limited touch points) £91m investment Automatic gra
Slide 27: Added value: ready to eat chicken
A D D E D VA L U E R E A DY T O E AT C H I C K E N Efficient cooking systems, including batch and continuous process Unique chargrilling capability for enhanced flavour and visual appeal Multi format – from whole birds and portions to pulled and shredded Customer base split across retail and food to
Slide 28: Added value: prepared poultry
A D D E D VA L U E P R E PA R E D P O U LT R Y Provides access to coated chicken category – over £1bn in retail and foodservice Broad range of processing capability - flash fry and fully cooked - air frying providing healthier options - fresh and frozen Major retail customer on board Weekly capacity
Slide 29: Unique, fully vertically integrated supply chain
U N I Q U E , F U L LY V E R T I C A L LY I N T E G R AT E D S U P P LY C H A I N SUSTA I NA BL E FE E D U N IQU E FARM IN G EFFICIENT P R I MA RY A DDED VA LU E MI L L I NG SYSTEM PRO CE S S I NG CA PA B I L I T Y BREEDING FARMS SUSTAINABLY FRESH & ADDED SOURCED SOYA VALUE CHICKEN INCUBATOR FACILIT
Slide 30: Cranswick Poultry: further growth opportunities
C R A N S W I C K P O U LT R Y F U RT H E R G R OW T H O P P O RT U N I T I E S A successful journey since first acquisition in 2014 Created a unique model for poultry supply chain in UK Investment and innovation built in from Day 1 Nest born unique to Cranswick Eye facility one of the most efficien
Slide 31: Site tour
S I T E TO U R 31
Slide 32: Site tour
S I T E TO U R L A I R AG E STUNNING PROCESSING CUTTING PAC K I N G TOUR APPROX. 90MIN PLEASE FOLLOW INSTRUCTIONS OF CRANSWICK TEAM ALL RELEVANT PPE WILL BE PROVIDED PLEASE REMOVE JEWELLERY AND WATCHES PLEASE STAY WITHIN ASSIGNED GROUP 32
Slide 33: Future proofing our labour plan
FUTURE PROOFING OUR LABOUR PLAN M I R A N DA S P E N C E R , G R O U P H R D I R E C T O R 33
Slide 34: Meet the Cranswick family
M E E T T H E C R A N S W I C K FA M I LY O U R 1 3 , 0 0 0 D E D I C AT E D A N D PA S S I O N AT E C O L L E AG U E S A R E P I VO TA L T O T H E S U C C E S S O F C R A N S W I C K T E A M DY N A M I C S A N E N G AG E D T E A M E M P L OY M E N T S TAT U S GENDER Annual survey completed to impro
Slide 35: Attracting people to the business
AT T R AC T I N G P E O P L E T O T H E B U S I N E S S W O R K I N G W I T H G OV E R N M E N T T O A D D R E S S L A B O U R G A P S A N D E N S U R I N G C R A N S W I C K R E M A I N S A N E M P L OY E R O F C H O I C E G OV E R N M E N T E N G AG E M E N T C O M P E T I T I V E E M P L OY M E N
Slide 36: The importance of D&I
T H E I M P O R TA N C E O F D & I P R O G R E S S T O DAT E Median Pay Gap decreased to 7.5% in 2021. The total employee population has increased by 15% compared to 2020, with a greater proportionate increase in the number of female employees across the Group Female representation has increased spe
Slide 37: Supporting our communities
SUPPORTING OUR COMMUNITIES AT C R A N S W I C K , W E S T R I V E T O W O R K W I T H O U R L O C A L C O M M U N I T I E S , P R OV I D I N G E M P L OY M E N T O P P O R T U N I T I E S A N D S U P P O R T I N G F U N D R A I S I N G C A U S E S AC R O S S T H E G R O U P F U N D R A I S I N G A N
Slide 38: Colleague engagement and recruitment are key priorities
C O L L E AG U E E N G AG E M E N T A N D R E C R U I T M E N T ARE KEY PRIORITIES FOR THE GROUP B U I L D I N G O N T H E PA S S I O N A N D C O M M I T M E N T O F T H E C R A N S W I C K FA M I LY Building on the engagement we have with our colleagues Working with Government to close the skills g
Slide 39: Making meat sustainable
M A K I N G M E AT S U S TA I N A B L E 39
Slide 40: The goal – net zero
W H E R E A R E W E T O DAY ? M I S S I O N – M A K I N G M E AT S U S TA I N A B L E VISION – THE WORLD’S MOST SUSTAINABLE MEAT BUSINESS T H E G OA L – N E T Z E R O B Y 2 0 4 0 2021 2025 2030 CARBON D E F O R E S TAT I O N F R E E S OYA S C I E N C E B A S E D TA R G E T S NEUTRAL 50% REDUCTION IN
Slide 41: Achievements & commitments
AC H I E V E M E N T S & C O M M I T M E N T S S U S TA I N A B I L I T Y – I N P R O G R E S S CARBON NEUTRAL SITES S C I E N C E B A S E D TA R G E T S VA L I DAT E D N E T Z E R O TA R G E T F O R 2 0 4 0 D E F O R E S TAT I O N F R E E S OYA R E G E N E R AT I V E AG R I C U LT U R E C A R B O N
Slide 42: Sustainability is Second Nature
S U S TA I N A B I L I T Y I S S E C O N D N AT U R E S U S TA I N A B I L I T Y F I R M LY E M B E D D E D I N T H E C U LT U R E P R O G R E S S C O N T I N U E S AG A I N S T E S TA B L I S H E D TA R G E T S S C I E N C E B A S E D TA R G E T S N O W AG R E E D N E W S U S TA I N A B I L I T Y L
Slide 43: Summary and Q&A
SUMMARY AND Q&A 43
Slide 44: Summary
SUMMARY Strong track record Strategic progress continues across the business Ongoing investment in capability and capacity Further growth opportunities in poultry Award winning Second Nature strategy continues Guidance for FY22 remains unchanged 44
Slide 45: Cranswick
CRANSWICK
Slide 46: Cranswick
a CRANSWICK Great British Taste ¥Y¥HOLEB