Carr’s has reported 1H results of £9.6m PBT and EPS of 7.9p (FD). The interim dividend was deferred until the full effects of COVID-19 become clearer. The profits show a 16% decline on the prior year, which was anticipated following the 12th March update where the group reported that trading had been weaker than expected in Agriculture in 1H (both in the UK and US). It also reported that there had been a delay in (two) anticipated engineering contracts in Asia, but this is more a factor for 2H20. The engineering pipeline is still strong so the medium-term outlook for this division remains robust. In Agriculture, farmer confidence (UK and USA) has remained weak. In the UK, we still face Brexit uncertainty (future trade deals) as well as some weakening in farmgate prices. In the US, cattle prices have risen from their lows, but not by any sizeable margin. In both countries, mild winter weather has allowed farmers to reduce purchases, of feed in particular, to keep costs in check. With lower demand, feed margins have also come under pressure. The group has reacted to these challenges by reducing central costs, which has helped to mitigate some of the profit shortfall vs original expectations. COVID-19 has not had any dramatic impact on the business at the present time (see overleaf), but prudently the group is keeping a tight focus on cash. Net debt closed the half at £25.4m (excl. leases), which is a comfortable 1.2x EBITDA. The undrawn facilities were £22m. We anticipate FY20E net debt of just under £30m, after the payment of some deferred consideration. We make no changes to forecasts today having adjusted them just one month ago for issues unrelated to COVID-19. The underlying trading outlook has not changed materially since, although COVID-19 adds a layer of uncertainty and the group will continue to monitor its effects closely.