The closure had eased “some capacity-related pressures” in the Scottish market, while its new state-of-the-art mill being built at Kirkcaldy was on track for commissioning in September, it said.
‘Plagued by over-capacity’
Significant efficiencies and improvements in operating margins were expected next year. “The financial performance of our milling business, operating in an industry plagued by over-capacity and volatile input prices for years, has begun to improve,” it said.
The statement – covering the 18 weeks ended July 6 2013 – said its agriculture division continued to benefit from one-off weather-related factors, first reported in its March statement, into May.
“In the UK, the cold and wet conditions persisted through Easter and beyond, which stimulated a high level of sales of compound feed, feed blocks, animal health products and fuel,” said its statement. “In the USA, the combination of droughts and a generally harsh winter resulted in poor quality forage in the spring, which increased the market for feed blocks.”
City analyst Investec valued the windfall benefit at £1.3M. “But we still anticipate profit progress next year as the new mill drives flour milling returns back to more acceptable levels,” said analyst Nicola Mallard.
Investec repeated its ‘buy’ advice on the firm’s stock.