STRONGER sales of branded food products helped boost profits at Premier Foods by 4.5 per cent in 2009 with further growth expected in the coming year.
The maker of Hovis bread and Branston pickle reported a trading profit of £323m for the year to 31 December, in line with previously issued guidance.
Sales climbed by 2.2 per cent to £2.66bn with branded goods enjoying a sudden surge in popularity with shoppers – up 6.5 per cent to £1.68bn.
It noted especially strong performances by Ambrosia and Hartley's in desserts, Loyd Grossman and Homepride in cooking sauces, Branston beans and relishes and Batchelor's soup and noodles.
However, the UK’s largest food manufacturer was feeling the pinch from higher input costs reflecting more expensive commodity markets and weaker sterling and higher promotional costs.
Meanwhile its Hovis brand enjoyed a “very successful” year during which it increased its market share by 3 per cent to hit 25.9 per cent. Sales were driven by improved product quality, better distribution, improved marketing and promotional activity.
Chief executive, Robert Schofield said: “Premier Foods achieved a tremendous amount in 2009. We strengthened our balance sheet, cut debt, increased Trading profits and returned to positive earnings. Most importantly we improved the performance of all our key brands in a highly competitive market place.
"Today we're outlining our plans and ambitions for the next chapter in the successful growth of the business. We are laying out a series of key targets and performance indicators for the next three years and providing an even greater degree of transparency as befits a business of our scale.”
Shareholder confidence in the group took a knock last year after the group was forced to turn to shareholders for £379m to help cut its massive debt pile. Net debt stood at £1.37bn at the end of the year.
Earlier this month the chairman David Kappler announced he is quitting the group as soon as a replacement is found. He had been in the role since it floated on the stock market in 2004.