Fourth year of record profits at Countrywide

Rural supplier Countrywide has posted record profits for the fourth consecutive year.

The company increased operating profit from £3.6m to £4m in the year to 31 May 2011, on group revenue 10% higher at £226.3m. After profits from the sale of land of £5m, the group made a profit before tax of £7.9m – almost £6m more than last year.

Countrywide’s agriculture business performed “exceptionally well” on the back of strong commodity prices and growth in feed sales, with revenue up by 14% to £95.6m, chief executive John Hardman said. Sales of compound feeds were up 10% by volume and fertiliser sales recorded a 20% rise in value. The seed and turf and amenity businesses also performed strongly.

“Our agri-business is in a very strong position and I think the agriculture sector looks strong for the next year at least,” he said. “Everything points to increased demand for food as the population is growing, which means we will have to be more self-sufficient.”

But with cereal prices remaining firm and little sign of any immediate downward pressure, Mr Hardman acknowledged the outlook for arable producers was probably stronger than for livestock.

The big issue for all sectors would be fuel bills and he warned there was a risk of greater price volatility over the winter if there was a repeat of the harsh weather witnessed last year. “The UK doesn’t have the capacity to store large volumes of gas and oil, so if we get a repeat of last winter it could create havoc with the supply chain and we could see people going short. It’s vital to plan requirements carefully in advance.”

Countrywide’s retail business did well despite a “highly competitive market”. Overall sales were up 4% to almost £79m and operating profits remained level at £3.6m. “We’ve got 50 stores now and although it’s tough, we’re not cutting our store budget or growth plans and still hope to open another three or five stores in the next financial year,” Mr Hardman said.

The solar PV “gold rush” helped Countrywide’s new energy business record a 12% increase in revenue to £52.1m. Following its acquisition of 7Y Energy, the firm recently launched a major new venture, Countrywide Renewable Energy, offering a range of renewable energy options from photovoltaic panels to biomass boilers.

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