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Friday, 31 October 2014

Carr’s Milling invests £17 million in new flour mill

Carr's Milling Industries, the Carlisle-based agriculture, food and engineering group, is investing £17 million in a new flour mill in Scotland.

But it has stressed that the move does not mean that its Silloth mill is under threat.

Chief executive Chris Holmes said: “That is definitely not the case. Silloth has seen several million pounds of investment in recent years. It is a modern mill and is very much part of our plans.”

The new mill, at Kirkcaldy in Fife, is expected to come on stream by September 2013.

Carr’s investment is a huge vote of confidence in flour milling at a time when the sector is struggling because of overcapacity.

The company believes that developing state-of-the-art facilities is the best way to remain competitive.

Its engineering division has just completed the acquisition of Clive Walton Engineering, based at Cumrew near Brampton, for £800,000.

Norman Addison, managing director of Carr’s engineering subsidiary Bendalls, said: “We currently sub-contract a lot of our machining work.

“We saw an opportunity to purchase Clive Walton, who we use as a sub-contractor, and integrate the business into Bendalls.

“It will enhance our capability and give us the opportunity to expand that side of our business.”

Clive Walton has a turnover of around £2m a year.

Its 10 employees will move to Bendalls’ site at Kingstown, Carlisle.

The announcements of the new mill and the acquisition came yesterday as Carr’s reported healthy trading figures for the 18 weeks to July 7.

The statement said performance was ahead of last year and ahead of budget, adding: “The board is confident that strong earnings growth will be achieved for the full year.”

A second interim dividend of 7.25p, up from 6.5p last year, will be paid on October 5.

Highlights included particularly strong sales of feed-block sales in the US.

The engineering division also performed well.

It robotics business, Wälischmiller, completed major contracts in Russia, France and China and successfully tested a system for Shell for cleaning tanks in Norway.

Bendalls is on track to complete a major vessel for the Evaporator-D project at Sellafield by September.

And work has started on a multi-million pound contract with BP to supply pressure vessels for a floating production, storage and off-loading platform being manufactured by Hyundai in South Korea.

Carr’s had net debt of £9m at June 2, compared with a cash surplus of £4.6m last September.

It says the cash outflow is down to fixed-asset additions and the need for higher working capital.

The interim statement had little impact on Carr’s share price, which was almost unchanged at 870p in early trading yesterday.

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