Premier Foods returns to growth as Batchelors and Angel Delight fly off the shelves

 
Alys Key
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Sales in the group's portfolio of brands have all grown (Source: Premier Foods)

Oxo and Bisto owner Premier Foods returned to growth in the 26 weeks to 30 September, driven by fast growth in convenience foods such as Batchelor's noodles and pasta.

Shares were up 6.1 per cent in early trading.

The figures

Revenue grew 1.5 per cent to £353m in the first half, with the strongest growth in the second quarter, when revenue jumped 6.2 per cent.

Pre-tax profits rose 0.5 per cent to £26.4m, while earnings per share were up 0.9 per cent to 2.56p.

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Why it's interesting

Over 40 per cent of the strong growth in the second quarter was a result of Premier's strategic partnerships with Nissin and Mondelez International. This helped to grow sales of Batchelors Super Noodle and Cadbury-branded cakes.

Old favourite Angel Delight also showed a jump in sales, growing 30 per cent. While it is not one of the group's heavily invested brands, the launch of ready to eat pots meant that the angelic treat flew off the shelves.

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International expansion is now on the menu for Premier, with Mr Kipling and Cadbury cakes pushing into New Zealand and Sharwood's expected to make gains in the USA.

Like all food producers operating out of the UK, Premier has experienced a rise in input costs over the past year. It said it would only raise prices as a last resort, and had been managing its own efficiencies to make up for the rise.

What Premier Foods said

Chief executive Gavin Darby said: "The cost efficiency programme we launched earlier this year is on track to deliver the expected benefits. We completed the issue of a new £210m high yield bond in June and our net debt was £21m lower than the same point last year; a little ahead of our plans. Overall, we continue to expect the business to make progress in the second half of the year and our expectations for the full year remain unchanged."

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