Wynnstay – The two sides of the business

PUBLISHED: 23 Jul 2019 @ 15:07 | Comments (0) |

Wynnstay (LSE:WYN) is an agricultural and rural supplier involved in a good spread of market segments. Its diversity gives it some resilience in the face of a storm or two occurring in particular product/geographical markets. However, a perfect storm, such as a bad Brexit causing a farming recession, could cause profits to suffer for some time.

It has two divisions, (a) Agriculture, (b) Specialist Agricultural Merchanting

£m	Agriculture Sales	Agriculture Op Profit	Merchanting Sales	Merchanting Op Profit
2018	334	4.29	128	5.53
2017	281	3.34	110	4.74
2016	250	3.01	118	4.54
2015	270	4.13	107	5.08
2014	309	3.80	105	4.88
2013	323	4.90	90	4.43
2012	295	4.71	80	3.90

Even though bulk sales through the Agricultural division are almost three times the turnover of the Specialist Agricultural Merchanting division profits tend to be higher in the stores operation.

Note the lack of growth in Agriculture, but the progression of the retail business.

The Agriculture Division

This collection of businesses manufactures and supplies agricultural inputs including 300,000 tonnes per year of feed for animals. It offers a full range of animal nutritional products, e.g. feed blocks. It has two compound feed mills and a blending plant of its own, but also uses third party mills to satisfy additional seasonal requirements or when customers are outside the area normally covered by Wynnstay’s lorries.

Wynnstay also supplies fertiliser and seed (cereals, grass, forage, oil seed, pulses, roots, maize, catch crops, game cover, amenity seed).

Its Grainlinks business offers farmers a grain marketing service with access to specialist milling, malting and feed markets. To the Shrewbury office GrainLink added a Grantham base in 2019.

The company also offers bespoke agronomy advice.

The main areas of operation are in Wales and central England.

The company’s reach has been steadily extended. Glasson Grain a Lancashire importer, shipper and trader of animal feed materials and fertiliser blender was bought in 2006. Wynnstay Woodheads Seeds, bought in 2010, operate a seed processing plant in Yorkshire, and trades grain and supplies fertiliser.

In 2015 it bought Agricentre which 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

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