19 October 2015
AIM:WYN
Wynnstay Group plc
("Wynnstay" or "the Group" or "the Company")
Expansion into New Trading Area with Acquisition of Agricentre
& Trading Update
Wynnstay, the agricultural and retail group, is pleased to announce that it has reached agreement with T. G. Jeary Ltd on terms for the acquisition of its West Country farm supplies operation, Agricentre, and certain related assets ("Agricentre" or the "Acquisition"). The Company expects to enter into a legally binding agreement for the Acquisition shortly with a view to completing the Acquisition on 30 October 2015. Wynnstay will utilise its existing banking facilities to fund the Acquisition. The terms of the Acquisition are not being disclosed for commercial reasons.
Established in 1961, Agricentre operates a network of eight units supplying a wide range of agricultural inputs including animal healthcare, dairy hygiene and animal nutrition products as well as feed related equipment and other hardware. Its units are located in Bristol, Calne, Langport, Honiton, Salisbury, Shepton Mallet, Sturminster Newton and the Isle of Wight. Agricentre has historically generated annualised sales of approximately £15 million and for the current financial year is expected to show a small operating loss.
The Acquisition is an important strategic move for Wynnstay, extending the Group's trading presence into a major new geographic region. Wynnstay expects to integrate the business into its existing stores network and to significantly enhance Agricentre's product range and operational efficiencies. However the full benefits of the Acquisition are not expected to come through for 12 months.
Wynnstay is also pleased to report that following satisfactory trading in the second half of the financial year to date, final results for the 12 months to 31 October 2015, before acquisition costs, are expected to be in line with market expectations. Looking ahead, the trading backdrop for farmers remains difficult and Wynnstay is taking a cautious view on the expected recovery in output prices over the next twelve months. The investment programme in the business is progressing well and underpins the Group's continuing development.
Ken Greetham, CEO of Wynnstay Group, said:
"Agricentre has been supplying farmers in the West Country with agricultural inputs for 54 years and I am delighted to announce that we have agreed terms to acquire the business. It is a strategically important move for us as it extends Wynnstay into a new trading area. We look forward to working with the existing management team to further develop the business and bring new products and services to their customer base.
UK farmers are currently facing challenges, with low farmgate prices particularly for milk. While the trading backdrop remains challenging, we remain positive about the long term opportunities driven by world food demand, and continue to focus on assisting farmers with the drive for enhanced efficiencies in production."
Enquiries:
Wynnstay Group plc |
Ken Greetham, Chief Executive Paul Roberts, Finance Director |
T: 01691 827 142 |
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KTZ Communications |
Katie Tzouliadis |
T: 020 3178 6378 |
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Shore Capital (Nomad) |
Stephane Auton / Patrick Castle |
T: 020 7408 4090 |
About Wynnstay Group plc
www.wynnstaygroup.co.uk
Headquartered in Wales, Wynnstay manufactures and supplies agricultural inputs, including animal nutrition products, seeds, fertiliser and agro-chemicals, to livestock and arable farmers. Its activities also include the supply of raw materials for feeds ingredients to farmers and other feed manufacturers, and the provision of grain trading services for farmers. Its specialist retailing activities comprise Wynnstay Stores, a network of country stores catering for farmers and the wider rural community, Youngs Animal Feeds, a manufacturer and distributor of equine products, and Just for Pets, a chain of pet products stores based across the West Midlands.
