Greencore enjoys 4.4% bump in sales despite tough UK market

Food group Greencore saw revenues rise 4.4 per cent to £331.9 million (€445 million) for the 13 weeks to December 26th.

Its convenience foods division recorded revenue of £320.4 million, up 5.4 per cent on a like-for-like basis.

The growth came despite the fact that the UK grocery market remained challenging with negative same store volumes and price deflation, the company said in a trading update ahead of its AGM in Dublin today.

Greencore said its key chilled markets performed well with continued good growth in the food-to-go market and a “positive performance” in the chilled ready meals market.

The company also noted the extension to the existing Northampton sandwich facility was successfully commissioned during the period.

Last year, Greencore caused a furore in Britain by going directly to Hungary to hire staff for its plant in Northampton, where it employs 1,100 and has plans for a new £30 million (€38 million) facility.

In the US, the company saw revenues jump 19.5 per cent driven by the rollout of new products with a key customer. The company has contracts to supply the Starbucks and 7-Eleven chains in the US.

Greencore said the construction of a new facility in Rhode Island was nearing completion, with commissioning due to start as planned in its fiscal second quarter.

Revenues in its ingredients and property division, which represents less than 5 per cent of total group activity, fell by 16.8 per cent to £11.5 million on a constant currency basis.

“As expected, revenue was impacted by the reduction in the commodity price of edible oils,” the company said.

In terms of the company’s outlook for the year ahead, the group said it remains well placed with strong positions in growing product categories.

“Notwithstanding the challenges of the UK grocery retail market, the business has had a good start to the year with encouraging growth against a strong comparator period last year,” it said.