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DJ National Milk Records Plc Quarterly Update

 
TIDMNMRP 
 
For immediate 
release 
9 May 2019 
 
                           NATIONAL MILK RECORDS PLC 
 
    ("NMR", the "Company", or, together with its subsidiaries, the "Group") 
 
           QUARTERLY UPDATE FOR THE THREE MONTHS ENDED 31 MARCH 2019 
 
NMR, the leading UK supplier of dairy and livestock services, announces its 
unaudited quarterly update for the three months ended 31 March 2019. 
 
Highlights 
 
  * Turnover for the quarter of GBP5.558 million (March 2018: GBP5.318 million) 
 
  * Revenues for testing of Johne's disease increased by GBP111,000, or 12.8% 
 
  * Revenues for testing for other diseases increased by 26% 
 
  * The number of cows on the NMR database is 713,379 (March 2018: 743,054) 
 
  * The number of cows on the Herdwise service is 424,544 (March 2018: 380,400) 
 
  * Increased investment in laboratory equipment and business systems 
 
  * The Company is on track to deliver full year results in line with its 
    expectations 
 
Andy Warne, Managing Director, commented: 
 
"I am pleased to announce this positive quarterly update which highlights the 
continuing growth in our top line revenues. Analysis of the trading quarter 
reveals a very strong performance in key areas of our business, and I'm pleased 
to report healthy growth in revenues for disease testing, testing for 
antibiotics and surveillance for antibiotics using NMR's proprietary FarmAssist 
service. However, the results also indicate that the figures for milk-recording 
revenues and the number of cows on the NMR database have reduced. It is 
therefore imperative for the business to continue to focus on its core 
customers and markets. The general outlook for UK dairy, and milk recording in 
particular, is strong, and I expect NMR to outperform in this area, therefore 
increasing milk recording revenues once again. 
 
"Additionally, I am pleased to report that our positive cashflow has enabled 
both the payment of a dividend in November and increased investment in the 
business as we head into the last quarter of the financial year. Our 
investments in our laboratories and business systems are key enablers of our 
future growth ambitions and I expect NMR to continue to invest ahead of our 
replacement rate for the foreseeable future. 
 
"The timing and detail of the Brexit process remains unclear, however nothing 
has changed from the statement NMR made in our 2018/19 Annual Report and we 
therefore still believe Brexit would be mildly positive for the UK diary 
industry overall. 
 
"I look forward to a busy final quarter of the financial year and to keeping 
the market updated with our progress." 
 
Trading Update 
 
Turnover for the third quarter was GBP5.558 million, GBP240,000 above the same 
period last year, an increase of 4.5%. As expected, the level of growth for 
this quarter, when compared to the first two quarters of the financial year, is 
not as strong, due to the first two quarters benefitting from one-off revenues 
from a contract for genomic tests of a bovine TB index, as well as some grant 
activity supporting the sale of heat detection systems. Quarter three showed 
continuing strong trading for disease testing, notably Johne's disease and 
Bovine Viral Diarrhoea, together with testing for, and surveillance of, 
antibiotics. 
 
In the Company's core trading business of testing milk samples, payment testing 
(the testing of bulk milk samples for milk processors) has continued to show 
consistent and measured growth, but revenues for milk recording (individual cow 
samples for farmers) has showed a modest decline during the quarter. This is 
reflected in the reduction of the number of cows on the NMR database, a Key 
Performance Indicator for the Company, and is therefore a focus area for 
management in their new strategy statement. 
 
NMR's Key Performance Indicators 
 
  * The number of cows on the NMR database is 713,379 (March 2018: 743,054) 
 
  * The number of cows on the Herdwise service is 424,544 (March 2018: 380,400) 
 
Key Projects 
 
The largest implementation for 2019 is the project to set-up Microsoft 
Dynamics365 for NMR. The scope of the project covers systems for finance and 
customer engagement, including corresponding control and reporting against the 
customer prospects pipeline and financial analysis across customer and product/ 
service groupings. As well as replacing existing outdated systems, the benefits 
to the business in terms of flexibility and efficiency are substantial. 
 
In addition, NMR continues to invest in new technology in its laboratories: the 
first part of 2019 has seen an increase in investment with orders placed for 
three liquid handlers and an automation platform to support the efficient 
growth in disease testing and its underlying systems capabilities through the 
ongoing development of NMR's Laboratory Information Systems ("LIMs"). 
 
Outlook 
 
Following the drought of summer 2018, feeding regimes over the winter have 
contributed to an over-supply of milk in recent weeks. This in turn is 
providing some downward pressure on milk prices as the Company enters Spring 
2019.  Any reductions may put near-term pressure on more discretionary farm 
inputs, such as heat detection systems, but the Company is on track to deliver 
results for the financial year in line with its expectations and is well 
positioned to continue its strategic development into the remainder of 2019 and 
2020. 
 
Upcoming Events 
 
NMR would like to note that Andy Warne, Managing Director, and Mark Frankcom, 
Finance Director, will be presenting at the Mello Conference on Thursday 16 May 
2019 at the Clayton Hotel Chiswick. The Company welcomes any investors or 
potential investors to come and meet the team. 
 
About NMR 
 
NMR is the leading supplier of essential management information to the UK dairy 
supply chain. Through a team of self-employed milk-recorders, it collects and 
tests milk samples for approximately 50% of the UK's two million cows. In 
addition, its laboratories provide payment testing and disease testing services 
for Britain's milk processors. NMR has a joint-venture laboratory in the 
Republic of Ireland providing similar services to farmers and processors across 
the whole of Ireland. Another division of the Group is a livestock traceability 
business, Nordic Star, which services the UK dairy and beef sectors. 
 
This announcement is available on the NMR website at www.nmr.co.uk 
 
The Directors of the Company are responsible for the contents of this 
announcement. 
 
For further information please contact: 
 
NMR plc 
 
Andy Warne, Managing 
Director 
+44-7970-009141 
 
 
andywa@nmrp.com 
 
Mark Frankcom, Finance 
Director                                                        +44-7458-002444 
 
 
markfr@nmrp.com 
 
Peterhouse Capital Limited 
 
Duncan Vasey 
 
Mark 
Anwyl 
+44-20-7220-9796 
 
Blytheweigh (Financial PR) 
 
Megan Ray 
 
Rachael 
Brooks 
+44-20-7138-3204 
 
Market Abuse Regulation (MAR) Disclosure 
 
The information contained within this announcement is deemed by the Company to 
constitute inside information as stipulated under the Market Abuse Regulation 
(EU) No. 596/2014. Upon the publication of this announcement via a Regulatory 
Information Service, this inside information is now considered to be in the 
public domain. 
 
 
 
END 
 

(END) Dow Jones Newswires

May 09, 2019 02:01 ET (06:01 GMT)