In a first-quarter update, Premier Foods (PFD) said poor weather had impacted sales of its desserts. The second quarter appears to have made up for this gloomy start, allowing the company to report better sales and volume growth. Recent partnerships with Nissin and Mondelez accounted for 40 per cent of the revenue growth in the second quarter, with Nissin’s Super Noodles pots now the fastest growing brand in Premier’s portfolio.
The annualisation of retail promotional strategies helped increase the number of grocery products sold, but mainly for lower-margin products. This caused trading profit in grocery, the group’s largest division, to fall 8.5 per cent to £51.4m. The company has offset higher input costs from weak sterling and more expensive commodities with targeted price increases.
Analysts at Credit Suisse expect pre-tax profits of £74m in the year to March 2018, giving EPS of 7.15p, from £74m and 7.07p in FY2017.
| PREMIER FOODS (PFD) | ||||
| ORD PRICE: | 39p | MARKET VALUE: | £329m | |
| TOUCH: | 39-39.25p | 12-MONTH HIGH: | 49p | LOW: 37p |
| DIVIDEND YIELD: | nil | PE RATIO: | 5 | |
| NET ASSET VALUE: | 95p* | NET DEBT: | 67% | |
| Half-year to 30 Sept | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2016 | 348 | -8.7 | -6.7 | nil |
| 2017 | 353 | -1.2 | 0.0 | nil |
| % change | +2 | - | - | - |
| Ex-div: | na | |||
| Payment: | na | |||
| *Includes intangible assets of £1.1bn, or 131p a share | ||||
