Wynnstay Group – estimated 2025 £10m cash in the bank, net assets of 590p, shares 370p, 27p earnings and 17.8p dividend – Target 450p

17.09.2025

Despite comments that the 2025 British farming harvest may well have been the second-worst since the 1980’s, I have taken a look at an agricultural supplies and services group, and I like what I have observed.

The £86m-capitalised Wynnstay Group (LON:WYN) is undergoing something of a rejuvenation of its business.

The Group has embarked upon its Project Genesis, which has the overall objectives to deliver a more integrated and efficient operating model, improve margins, and create a strong platform for sustainable growth.

The three-year transformation programme is reported to have progressed well in the first half-year to end-April.

The Interim Results to end-April showed sales down to £304.9m (£328.5m) reflecting feed and grain trading activity combined with lower commodity prices.

However, reflecting cost discipline and better unit margins, the Powys-based Group’s adjusted pre-tax profits were up an impressive 41% at £5.4m (£3.8m).

We can only be a couple of weeks away from the company issuing a Trading Update for its current year to end-October, which should help analysts to hone up on their estimates for this and next year.

The Business

Founded in 1918 in Wales as a farmers' cooperative, with its shares gaining a listing on AIM in 2004, today Wynnstay is a leading supplier of agricultural products and services, with the ability to offer the whole package to farmers.

Spanning three main divisions; Feed, Arable and Country Stores, customers can access all the necessary farming inputs through a variety of distribution channels.

With over 20,400 commercial relationships with farmers, the group operates from 11 manufacturing sites across the country, with some 869 employees, as well as 127 commercial vehicles within its fleet.

Feed and Grain - Wynnstay manufactures and supplies a wide range of feeds and animal nutrition products, principally for the dairy, beef, sheep and poultry sectors.

The Group operates two feed mills and three blending plants, manufacturing feed that is offered in compounded, blended and meal forms, and sold both in bulk and in bags.

Bagged feed is predominantly sold through the Group's store network.

Wynnstay also sells a range of raw materials for feed through its Wynnstay and Glasson Grain brands.

Farmers are offered grain and combinable crop marketing services through the GrainLink business.

Arable - The Group supplies a full range of high-quality, Wynnstay-branded agricultural fertiliser products (compound, straight, and blended), and the Glasson fertiliser blending operation is the UK's second largest.

The Group’s specialists offer farmers bespoke fertiliser programmes.

These address specific soil conditions, thereby increasing the efficiency of the fertiliser and improving plant growth.

It also supplies a wide range of seeds (spring, autumn, grass, maize, catch & forage, and environmental seeds), and operates a major seed processing facility in Shrewsbury, Shropshire.

Stores - Wynnstay operates a network of 51 stores catering mainly for the needs of farmers but also rural dwellers.

Stores are mostly located within the livestock areas of England and Wales.

The store network is supported by multiple routes to market, including a digital sales platform, sales trading desk, regional field sales teams and specialist catalogues.

Management Comment

With the Interim Results at the start of July, recently appointed CEO Alk Brand stated that:

"The Group has delivered a strong recovery in the first half, with the improved profitability reflecting the benefits of our operational initiatives.

The new management team is now in place and is delivering improvements, supported by a clear plan and strong leadership focus.

Project Genesis is progressing well and, together with ongoing investments, supports our ambitions to create a stronger, fitter business, which provides our customers with the highest service levels and our shareholders with improved returns. 

Current trading is encouraging, and the Group remains well-positioned to achieve market expectations for the full year."

The Equity

There are some 23.13m shares in issue.

The larger holders include TrinityBridge (9.92%), IG Markets (6.56%), Milkwood Capital (6.55%), Schroder Investment Management (4.10%), Charles Stanley Investment Management (3.94%), Canaccord Genuity Wealth (3.5$%), HSBC Bank (2.84%), Teviot Partners (1.26%), and Hargreaves Lansdown Asset Management (1.04%).

Analyst’s Views

Analysts Akhil Patel and Clive Black, at Shore Capital Markets, have a net asset value on the Group’s shares of some 590p each.

For the current year to end-October their estimates are for slightly lower revenues of £600.0m (£613.1m), while its adjusted pre-tax profits could come out at £8.5m (£7.6m), lifting earnings to 26.9p (23.1p) per share, with a 17.8p (17.5p) dividend.

The coming year could see £634.0m revenues, £10.0m profits, 31.6p earnings and a dividend of 18.1p per share.

In My View

I agree with the ShoreCap analysts in considering that the Group could see potential for market share gains, with sustainable earnings growth.

Strategic delivery of such growth will bring about a re-rating of the Group’s shares, now just 370p, which means that they could well offer an attractive upside, with 450p being an easy Price Objective.