FARM SUPPLY group Wynnstay has managed to boost profit despite tough trading conditions in the animal feed market and lower overall sales.

The Llansantffraid, Powys-based firm, which has retail stores in Wales and supplies farmers in the Midlands as well, pushed earnings before tax to £1.99m for the first six months of the year.

It represents growth of 9%, even though turnover at the group slipped from £58m to £55m.

Chairman John Davies said business was favourable and blamed the sales slump on lower feed prices and divestment of non-core operations.

“We have seen signs of improving demand across some sectors and we continue to work for productivity gains and a reduction in the cost base of the business,” he told investors.

“Although our core businesses continue to face challenges, particularly by the well-documented changes to the CAP, we firmly believe the effects of the changes provide us with growth opportunities.

“In particular, we are well placed to gain further market share from rationalisation.”

Wynnstay continued to see the benefits of its diversification strategy, including last year’s acquisition of Eifionydd Farmers stores and horticulture specialist Foxmoor, he added.

Its property JV, Wyro Development, and new feed joint venture, Youngs Animal Feeds also contributed to the bottom line.

Although beef feeds had been hit by CAP reform uncertainty, aggressive marketing had raised dairy feed sales by 11% and improved sheep feed sales.