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Chief Executive's Review



Wynnstay’s performance was delivered against a difficult agricultural backdrop, including generally weaker farmgate prices. Farmer sentiment over the year was also significantly affected by uncertainties over Brexit. Combined, these factors resulted in farm businesses holding off investment decisions and created margin pressure in certain product categories. 

The exceptionally warm winter months and the early spring, together with a good grass growing summer, reduced farmers’ need to purchase feed and feed-related products across the year as a whole, and the impact of this was felt in both the Agriculture and Specialist Agricultural Merchanting Divisions. 

Fertiliser and grass seed sales benefited from the early spring, however the wetter summer subdued demand for arable inputs in the second half of the year. 

Glasson Grain Limited, with its broad-base of activities in raw material trading, added-value feed products and blended fertiliser manufacturing, performed exceptionally well. The fertiliser business in particular performed very strongly, consolidating our position as the second largest fertiliser blender in the UK.

In a difficult marketplace, GrainLink, which markets and trades grain, performed well, increasing its tonnage.  This was helped by the Grantham trading office, which was opened in late spring 2019 and made good progress.

A key feature of the year was the introduction of cost reduction and efficiency programmes. Our investment across manufacturing, distribution and systems will support improved efficiencies and is ongoing.

We believe that the ability to provide the latest technical and product advice to our customers is fundamental to securing their business in the future.  We therefore continued to invest in our colleagues in line with our objective to improve Wynnstay’s proposition as a value-added adviser.  We added to our on-farm technical teams, which span the dairy, youngstock, poultry, animal health, hardware and arable cropping sectors, in particular by appointing a National Sheep & Beef Specialist. We were able to introduce precision farming techniques to both our livestock and arable farmer customers, through feeding and nutrient management programmes that use new technologies sourced from our innovative suppliers and associates. 


Agriculture Division

The Agriculture Division’s main activities comprise the manufacture and processing of feed, fertiliser and seeds as well as other agricultural inputs. Glasson Grain and GrainLink also form part of this Division.

Total revenues amounted to £358.69m (2018: £334.34m), mainly reflecting higher commodity prices, and the operating profit, including the contribution from joint ventures, was £2.95m (2018: £4.29m). The decrease in operating profit year-on-year mainly reflected reduced customer demand, especially for feed. 

Feed Products

Feed products are manufactured at our main facilities at Llansantffraid and Carmarthen as well as at a smaller blending facility at Rhosfawr.  We manufacture a broad range of ruminant and monogastric feeds, in both loose bulk and a variety of bagged sizes. We also sell raw materials to farmers and other feed manufacturers.  The wide range of feed that we offer, supplying dairy, beef, sheep, pig and poultry producers, is a strength, helping to mitigate variation in demand across the sub-sectors. Our product ranges are complemented by our technical sales colleagues who are able to advise customers on all aspects of animal nutrition.

Feed volumes were significantly impacted during the year by weather conditions, and sales were sharply behind last year’s record result, but in line with market trends. The exceptionally mild winter and early spring reduced demand during the key trading period, after which the excellent grass growing summer reduced the need for bought-in feeds and feed-related products in the ruminant sector. 

Sheep feed volumes in particular reduced, both in the spring lambing season and the summer/autumn period. This reflected the national trend, with sheep farmers selling their lambs earlier in the year ahead of a potential ‘hard Brexit’ in October 2019.

Dairy and beef farmers also moved feed spending to ‘straight’ feeds as opposed to manufactured compounded and blended feed, which adversely affected sales. This trend was evident nationally.

We continued to strengthen our position within the free-range egg sector, and achieved higher volumes of poultry mash, despite egg prices remaining subdued. This was helped by our team of poultry specialists who provide a value-added service, advising on quality egg production.

Our team of highly trained calf and youngstock specialists, offering advice and introducing innovative products and ideas to livestock farmers, helped to drive an increase in market share in milk replacers.

Capital investment at Llansantffraid Mill has improved efficiency in both manufacturing and distribution. This has been reflected in record daily and weekly production figures and reduced energy unit costs over the year.

We will continue to seek opportunities to strengthen our feed activities, and to ensure that we support our customers with innovative, added-value products. We also welcome the increasing attention by food retailers on feed ingredients that are sourced in an environmentally sustainable manner.  Wynnstay is well placed in this regard to deliver the needs of the market.

Glasson Grain

The Glasson business, which is based at Glasson Dock, near Lancaster operates in three main areas; the supply of feed raw materials, production of fertiliser, and manufacture of specialist added-value animal feed products. Glasson’s dock-side location remains an important part of its success and provides a valuable competitive advantage. It is also the UK’s second largest blender of fertiliser.

The Glasson team delivered a record performance this year, significantly outperforming budget expectations.

Feed raw materials commodity trading performed well in a difficult trading environment. After a strong start to the financial year, trading activities reduced over the spring and summer periods as demand for bought-in feed reduced.

The fertiliser blending operations delivered an exceptional performance. The integration of the fertiliser blending plant at Goole and continued sales expansion at Montrose resulted in record volumes. The mild weather and early spring encouraged farmers to apply fertiliser to their land.  This resulted in good trading volumes, although the summer and early autumn activities were restricted by good grass growing conditions and wet weather restoring arable planting.  The ‘Glasson’ brand continues to grow and attract new business. 

Specialist added-value feed products also enjoyed an exceptional year with record volumes. The business has been successful in developing innovative products that win new customers.

Arable Products

Overall, our arable activities performed strongly during the year.

Our seeds activities performed well despite a number of challenges during the year. The very early spring encouraged strong grass seed sales, but sales dipped during the wetter summer. This meant that overall grass seed sales were below last year’s record levels, although margins were maintained. Spring cereal seed volumes were lower than the prior year’s strong performance, which was a reflection of the increased winter cereal plantings of 2018 (4.0% higher than the previous year).  New legislation restricting the use of some traditional seed dressings also challenged cereal seed margins. Sales of autumn/winter cereal seed were strong, although the wet weather has significantly reduced the acreage sown to date and this will impact on the volume. It is expected that farmers will require lower volumes of seed next autumn since seed will be carried over from one year to the next.  However, there should be a positive impact on spring seed sales in 2020, as farmers plant spring cereal seed instead of winter cereal seed.

We continue to seek innovation within the seed business by aligning ourselves to seed breeders, introducing newer varieties and continually assessing the value of new seed dressings.

Merchanted fertiliser sales for the year were below budget but we have maintained market share. Sales in the first half of the year were higher year-on-year as farmers took advantage of the early spring to replenish forage stocks. However, the wet summer that followed reduced sales activity in the second half of the year since there was an abundance of on-farm grass and silage available. 

Our team of highly qualified agronomists continue to advise on best practice in terms of crop management and environmental care, which includes the use of digital nutrient management programmes.

GrainLink performed well in challenging conditions. The high-volume harvest of 2019 offered increased volumes for sale and the integration of the Grantham office helped to increase the volume of trade.

Our specialist Arable event held near Shifnal, Shropshire, in June 2019, continues to grow from strength to strength. Over 1,000 farmers attended and there were opportunities to hear presentations from keynote industry speakers, and obtain advice on innovative arable techniques, seed varieties, and new mechanisation practices. The event ensures that Wynnstay is recognised as a key supplier of innovation and advice to the arable sector.

The management of the arable operations has been restructured with all activities now under a single director.  Woodhead Seeds has also benefitted from the appointment of an arable manager to oversee sales activities throughout the sector. Overall, the arable business is well-placed to build upon its strong position in the marketplace.

Revenue from our Specialist Agricultural Merchanting Division increased by 16.9% to £128.26m for the year (2017: £109.73m). Acquisitions accounted for approximately £7.83m of this rise and like-for-like sales were £10.7m ahead of the prior year including the effect of inflation. Operating profit contribution from the Division rose by 16.7% to £5.53m (2017: £4.74m).

The Division trades predominantly through a network of depots, which supply a wide range of products specifically geared to the needs of farmers, although rural dwellers also account for a proportion of sales. The offering at our depots includes animal health products, bagged feed and hardware. We also have SQPs (Suitably Qualified Persons) who provide value-added advice on animal health products, as well as the other products that we sell, and they help to make this operation an attractive route to market for our supplier base. The number of depots that we operate now stands at 59 (October 2017: 50).

As well as our Youngs Animal Feeds business, the Division also includes sales generated through our other channels-to-market, including specialist catalogues (for dairy, beef, sheep and poultry farmers), vans and online. It is an important part of the Group’s wider agricultural activities, and also assists in establishing the Group’s trading presence in new geographic areas.


The Specialist Agricultural Merchanting Division trades predominantly through a network of depots, which supply a wide range of products specifically geared to the needs of farmers, although rural dwellers also account for a proportion of sales.  The offering at our depots includes animal health products, bagged feed and hardware.  We also have Suitably Qualified Persons (“SQP”) who provide value-added advice on animal health products as well as the other products that we sell. This aspect of our operations make us an attractive route to market for our supplier base. 

Channels-to-market also include specialist catalogues, specifically for the dairy, beef, sheep and poultry sectors, vans and online. Our Youngs Animal Feeds business is accounted for in this Division.

Total revenues generated in the year amounted to £131.84m (2018: £128.26m) and the Division’s operating profit contribution was £5.24m (2018: £5.53m). Total revenues benefited from first full-year contributions from acquisitions, principally the Countrywide depots, acquired in April 2018, and MD Lloyd acquired in January 2018. There was also a partial contribution from Stanton Farm Supplies, acquired in April 2019. Contributions from acquisitions accounted for £8.1m of incremental sales in the year.  Like-for-like revenue was 3.5% lower than the previous year, which was predominantly as a result of the reduction in demand for bagged feed and feed-related products.

Wynnstay Depots

Following our acquisitions, we amalgamated two depots and closed two small depots in our network of Specialist Agricultural Merchanting depots. This has taken the network to 55 depots (2018: 59 depots), which are located across the North West, Midlands, South West and Wales. The Countrywide depot integration was also successfully completed in the year.

Revenues were impacted by the significant reduction in demand for bagged feed and feed-related products, caused by weather conditions, as well as lower demand for grass seed, fertiliser and agrochemical sales during the wetter summer and autumn periods.

The continued development of our youngstock team helped to drive a record performance for milk replacer products.

During the year, like-for-like inventories at our depots reduced by 15.3%, benefiting our working capital utilisation.

Sales via our alternative routes to market, including catalogues and on-line activities continued to account for a relatively small percentage of Divisional sales. 

We will continue to train agricultural specialists to enhance the level of advice-driven transactions from our customers and will seek opportunities to extend our footprint into new geographical areas.

Youngs Animal Feeds

Youngs Animal Feeds manufactures and markets a range of equine products that are sold throughout specialist outlets across Wales and the Midlands and in some of our Specialist Agricultural Depots.  Our Molichop branded feed range, manufactured at our purpose-built factory at Standon, remains a market-leading added-value product.


The Group has three joint venture businesses, Bibby Agriculture Limited, Wyro Developments Limited and Total Angling Limited as well as an associate company, Celtic Pride Limited. The Bibby business performed very strongly, increasing market share, especially within the dairy sector.  This helped to drive an increase in the combined profit contribution from the four businesses. 

I am very proud of our dedicated, professional and talented employees, and would like to thank them all for their continued hard work and commitment. Their skill and experience helps to ensure that Wynnstay remains one of the leading suppliers of agricultural products and advice to the agricultural industry.


It has been a challenging year and I am proud of the way colleagues have responded. Wynnstay is in a stronger position as a result, and I would like to thank everyone for their contribution and commitment.


UK Government support for farmers in the forthcoming year will continue in its current form. It is set to change in the longer term with the UK’s exit from the European Union and national schemes are expected to be introduced to support efficiency at farm level. New Environmental Land Management Schemes (ELMS) will also be introduced to incentivise and reward farmers for environmental outcomes. In the very short term though, ongoing uncertainties are likely to continue to stifle investment on farms. 

Farmer sentiment remains sensitive to farmgate prices, with milk, beef and egg prices lower than a year ago.   Global supply and demand for lamb has lifted sheep prices though, which bodes well for 2020. Feed volumes so far have been adversely affected by the on-farm forage stocks, and sales are behind the equivalent point last year. Given the significant reduction in autumn cereal planting that resulted from the prolonged wet weather we also anticipate lower cereal tonnages for trading later in the year.

We continue to concentrate on improving efficiencies, building on the work of the last financial year. In addition, we plan to expand our technical teams both on-farm and in our specialist agricultural depots, and to strengthen our digital and precision farming offering. Sourcing and accessing innovative products to our farming customers remains an important part of our overall offering. We are engaging with the National Farmers Union’s goal of reach ‘net zero’ greenhouse gas emissions across the whole of agriculture in England and Wales by 2040. 

Although we anticipate that the agricultural sector will continue to experience a difficult period, we believe that Wynnstay is well-positioned to navigate through and is well-placed to seek opportunities for growth.

Gareth Davies
Chief Executive Officer
22 January 2020