Agricultural sector consolidator Wynnstay has acquired specialist distributor John Hatton (for an initial £237,000) in a deal complementing the £2.4m 2006 takeover of Glasson. Lancaster-based like Glasson, John Hatton distributes animal health products, feed and supplements as well as dairy hygiene products. The deal boosts the group’s market share in a key livestock region.

A ‘rural retailer’, Wynnstay is keen on increasing its presence in the country stores market. It has outlets in Wales and England’s border counties and is hoping to improve returns at its acquisitions. In December, another two stores, selling ‘agricultural requisites’, gardening, equine and pet products, and clothing to farmers and other rural dwellers, were acquired.

Towards the end of 2007, Wynnstay managed to farm £1.28m from institutional investors at 260p in a funding move to help finance further deals as well as organic growth. Though Wynnstay has encountered challenges within its markets, it’s nicely balanced spread of businesses have enabled its financials to progress. Pre-tax profits of £1.96m were cultivated for the half to April ’07, representing a rise of 39%, on near-53% sales growth to £79.9m, with Glasson performing ‘excellently’. The interim dividend was raised from 1.75p to 1.875p, with net assets increasing to £26.83m (£24.45m).

Growth Company Investor considers shares in Wynnstay, a robust concern offering progressive dividends and a valuation underpinned by net assets, as well worth holding.

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Wynnstay Group	AIM	£36.31m	252.50p	0.00p
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