Greencore profit, revenue up despite ‘difficult’ UK market

Growth driven by stronger ‘food to go’ market

Greencore chief executive  Patrick Coveney said the group delivered good financial and strategic progress in the first half of the year. Photograph: Eric Luke/The Irish Times

Greencore chief executive Patrick Coveney said the group delivered good financial and strategic progress in the first half of the year. Photograph: Eric Luke/The Irish Times

 

Operating profit at Greencore rose almost 8 per cent and revenue climbed over 3 per cent driven by growth in the food to go market.

In an interim management statement, Greencore said revenue rose to £639.8 million in the 26 weeks to March 27th 2015, a rise of 3.2 per cent as reported and 3.9 per cent on a like for like basis.The growth came despite a difficult UK market, with revenue growth lower over the six months in the rest of the UK portfolio compared with the food to go sector, which saw revenue rise by 8.7 per cent.

“The UK grocery retail environment remains difficult with profound changes taking place amongst our customers, together with net price deflation,”Greencore said in a statement. “Our business has continued to trade well despite these challenges given its focus on convenience offerings which continue to exhibit volume growth.”

Operating profit rose to £40.1 million, from £37.2 million in the same period a year earlier, while convenience foods revenue increased 4.9 per cent on a like for like basis, reaching £614.7 million.

Adjusted earnings per share rose 8.6 per cent to 7.6 pence, with an interim dividend of 2.4 pence per share.

The company said it was planning a significant increase in capital investment, with the phase one extension of its Northampton facility successfully completed and second phase already underway. During the period, it also began the roll out of a new product range from its extended Jacksonville facility in the US, with the new build in Rhode Island completed in late March.

“The group delivered good financial and strategic progress in the first half of the year,” said chief executive Patrick Coveney. “The group has stepped up its capital investment programme in new sites, which will provide a solid platform for growth in the months and years ahead.”