The best sales performance in five years helped to lift Premier Foods' (PFD) shares on results day. Grocers and food retailers continue to outperform their non-food counterparts, and Premier is no exception. Despite a slow start to the year, annual revenues grew by 3.6 per cent, registering 5.3 per cent growth in the second half and a 7 per cent acceleration in the final quarter, signalling real momentum. Margins, which had been under pressure through cost-push inflation and sterling devaluation, also showed improvement as FY2018 drew to a close.
Chief executive Gavin Darby credited the group’s international business, as well its partnerships with Nissin and Mondelez International, for the year’s performance. Sales outside of the UK rose by a quarter at constant currencies – effectively doubling in the past three years – while partnerships now contribute more than half of reported revenue growth. Looking at products, Premier’s own-brand sweet treat ranges grew fastest, with revenues up nearly 17 per cent to £58.2m
Analysts at Shore Capital are reviewing current-year forecasts of pre-tax profit of £74.2m and EPS of 7.2p (from £74.2m and 7.2p in FY2017).
| PREMIER FOODS (PFD) | ||||
| ORD PRICE: | 38.5p | MARKET VALUE: | £324m | |
| TOUCH: | 38.5-38.7p | 12-MONTH HIGH: | 45p | LOW: 36p |
| DIVIDEND YIELD: | nil | PE RATIO: | 43 | |
| NET ASSET VALUE: | 113p* | NET DEBT: | 52% | |
| Year to 31 Mar | Turnover (£m) | Pre-tax profit (£bn) | Earnings per share (p) | Dividend per share (p) |
| 2013 (y/e 31 Dec) | 840 | 4.4 | -12.8 | nil |
| 2015** | 960 | -136.0 | -12.7 | nil |
| 2016 | 772 | -13.0 | 4.1 | nil |
| 2017 | 790 | 12.0 | 0.7 | nil |
| 2018 | 819 | 20.9 | 0.9 | nil |
| % change | +4 | +74 | +29 | - |
| Ex-div: | na | |||
| Payment: | na | |||
*Includes intangible assets of £1.07bn, or 128p a share **15-month period | ||||
