Wynnstay Group PLC on Wednesday said it anticipates its full-year results to be below market guidance, following ‘challenging conditions’ in seasonally important months.
The Powys, Wales-based agricultural products and services company said its full-year results will be ‘materially lower’ than current market expectations and lower than the previous financial year.
Wynnstay is due to announce its results for the year ending October 31 at the end of January 2025.
Shares in Wynnstay were down 6.9% at 298.00 pence each in London on Wednesday afternoon.
The company said: ‘There are two main factors behind this shortfall: the underperformance of the feed division and of the fertiliser blending operation, the principal activity at Glasson Grain. The feed division is experiencing a weaker second-half performance, driven by lower volumes relative to a market that has only grown marginally year-on-year. This mainly reflects deceased poultry feed volumes as this activity transitions away from manufacturing poultry feed at Twyford; these lower volumes are currently expected to persist for a further period.’
Wynnstay noted that whilst Glasson’s fertiliser blending operation has improved from a ‘challenging’ previous year, margins were significantly impacted by falling market prices in the later summer and autumn months. Additionally, caution from farmers in approaching product purchases has reduced volumes in the last two months, driven by uncertain harvest and planting outcomes after heavy rain.
The company’s specialist merchanting division, on the other hand, has ‘modestly outperformed’ its previous year results to date, despite constrained farmer spending.
The contribution from joint ventures is below the record levels seen last year, but remains in line with expectations.
Wynnstay said: ‘The group has a well-established market position and benefits from a strong balance sheet and good cash flows. While there are a number of headwinds in the short-term, the board expects a better outlook for the livestock and dairy sectors and anticipates an improved financial performance in financial 2025 compared to financial 2024. The group will continue to focus on operational improvements and efficiencies and continue to invest for the future.’
Broker Shore Capital on Wednesday reduced its adjusted pretax profit forecast for Wynnstay by 35% to £7.5 million.
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