Profits up at Carr's Group despite challenging UK market

LONDON (ShareCast) - Agriculture, food and engineering business Carr's Group saw its shares rise after posting good first half-year results. Despite a decrease in revenues by 2.8% to £208.6m, the group reported a 5.4% increase in profits before tax to £10.6m, which drove earnings per share up 11.5% to 8.7p.

Chief executive Tim Davies said challenging conditions had persisted in some of its markets, including the UK, but added that the group remains on track to meet its expectations for the full year.

Its UK farm incomes declined due to a fall in the farmgate milk price, but its US agriculture operations delivered "outstanding" performance thanks to its feed block products Smartlic and Feed in a Drum.

Weak commodity prices drove food revenues lower, but flour sales volumes were higher.

The engineering division has been hurt by global political and economic conditions in some markets. Carr added that these uncertainties are expected to continue through 2015.

Investec (LSE: INVP.L - news) analysts maintained their 'buy' recommendation and 196p target price and added: "A solid increase in 1H profits and a reiteration of confidence in meeting full year expectations should be well-received by the market, which has been nervous around agri company prospects.

"The group's diversity and past investment has stood it in good stead to weather the current market conditions." Shares (Berlin: DI6.BE - news) were up 7.94% to 149.5p on Monday at 12:15.