Carr's Group - Supplements sales offset low oil and gas investment
Carr’s trading update for the first 19 weeks of FY21 notes that trading in Agriculture was ahead of management expectations because of strong sales of supplements. This was offset by a weaker than expected performance in the Engineering division caused by continued low crude oil prices. We note that net debt (excluding leases) was 24% lower year-on-year at the end of November, reflecting close inventory control and lower commodity prices. We leave our estimates broadly unchanged and reiterate our indicative valuation of 170p/share.Carr's Group operates across the agriculture and engineering sectors which supplies products and services to countries around the world. Co.'s agriculture division includes an international feed block supplement business, and in the U.K., this division also sells animal feed, fertilizer, animal health products, fuel, farm machinery and rural supplies. Co.'s engineering division designs, manufactures and supplies precision parts, equipment, robotics and remote handling products. These products and services are supplied primarily into the nuclear, defense and oil and gas markets.
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