23 January 2024
Premier Foods plc (the “Group” or the “Company”)
| Biggest ever Christmas, significant market share gains1,2 |
Premier Foods today provides its Quarter 3 trading update for the thirteen weeks ended 30 December 2023
| · | Q3 Group sales up 14.4% versus prior year; Q3 Branded sales up 12.7% |
| · | Grocery sales up 11.9%, Sweet Treats sales up 21.3% |
| · | Total market share2 increased by 121 basis points versus prior year |
| · | International sales up 11%3, strong performances across strategic markets |
| · | Sales from New Categories up 108% versus prior year |
| · | Strong The Spice Tailor sales in both UK and International; FUEL10K is off to a good start |
| · | Well on track to deliver on previously upgraded expectations for full year |
Note: Headline results presented for the quarter exclude Knighton Foods
| Alex Whitehouse, Chief Executive Officer |
“We delivered a very strong performance in our important third quarter with double-digit sales growth across the Group, underlined by particularly strong market share gains of over 120 basis points. Our International business had another very good quarter, growing sales by 11%, delivering progress in our strategic markets. Sales in new categories more than doubled, with Ambrosia Porridge pots and Mr Kipling and Angel Delight Ice-cream both standout performers. Meanwhile, The Spice Tailor continued to grow strongly, achieving distribution gains in target markets, while FUEL10K integration into the Group is progressing in line with plan.”
“Festive favourites such as Bisto, Oxo and Paxo contributed to our biggest ever Christmas, as consumers enjoyed not only the core ranges but new products such as Bisto Best meat free gravy and Paxo Chicken and Bacon stuffing. We sold nearly 190 million mince pies, 4 million more than last year, helped by the new Mr Kipling ‘Best Ever’ Signature mince pies.”
“The lower promotional price points we introduced in the third quarter have positively impacted performance while also helping consumer budgets go further. These lower prices will be extended to additional products such as Loyd Grossman cooking sauces and Mr Kipling Bakewell slices in quarter four.”
“With another strong period of trading behind us, and great plans for the coming months, we are well on track to deliver on profit expectations for this year.”
Trading update |
Grocery
Grocery sales increased by 11.9% in the quarter, with strong performances across the portfolio as the Group again substantially outperformed its categories, delivering over 110 basis points of share growth. Brands in the Flavourings & Seasonings category enjoyed a strong festive season; Bisto, Oxo and Paxo delivered significant growth in both core and new product ranges such as Bisto Best meat free gravy, Oxo Stock Pots, and Paxo Chicken & Bacon stuffing. Sales from new categories more than doubled in the quarter; Ambrosia Porridge pots benefitted from the launch of the new Apple & Blueberry flavour, while Mr Kipling and Angel Delight ice-cream hit top quartile run rates following listings in two major retail customers. Non-branded sales were 14.5% higher reflecting price increases in retailer branded product categories compared to the same quarter last year.
Sweet Treats
Branded Sweet Treats returned to growth with sales up 17.1%, largely due to significantly higher sales of Cadbury cake compared to last year. This strong performance reflected growth in core Cadbury Mini Rolls and cake bars and a softer comparative due to unscheduled maintenance of a plant line last year. The Group grew well ahead of the cake category in the quarter, gaining over 120 basis points of share and sold 4 million more Mince Pies than last year, including the new Mr Kipling ‘Best Ever’ Signature mince pies. Growth of 28.7% in Non-branded sales was due to contract gains in pies and tarts and pricing benefits.
International
International continues to progress strongly, sales grew another 11%3 in the period. In Ireland, growth was broad based, with all Grocery brands significantly up on the prior year. The Spice Tailor and Sharwood’s were major drivers of sales growth in Australia, reflecting strong instore execution. In the USA, Sharwood’s cooking sauces grew strongly, benefitting from increased distribution gains, while Mr Kipling cake is now listed in nearly 2,000 stores.
Mr Kipling has also achieved new listings in Canada, which will take the combined number of listings across North America close to 3,000 stores. Following recent distribution gains in New Zealand, Belgium and Switzerland, The Spice Tailor will also soon be available in the USA and France, increasing the brand’s presence to 10 countries.
| Outlook |
The Group continues to trade strongly, delivering further progress against its strategy, evidenced by another quarter of double-digit sales growth and market share gains. Now into the final quarter of its financial year, the Company is well on track to deliver against its previously raised profit expectations. Looking further ahead, a full resolution of its pensions schemes is expected within three years, which will open up a range of value enhancing opportunities to further accelerate shareholder value.
~ Ends ~