Premier Foods today hailed an “outstanding” year of growth as consumers used its brands to cook at home more during the pandemic.
Over the 52 weeks to 3 April, the group’s total revenue rose 10.3% to £934.2m with a 13.6% increase in sales of its branded products offsetting a 6.3% decline in non-branded.
Trading profit climbed 11.9% to £148.3m despite increased marketing investment and Covid-related costs, whilst adjusted pre-tax profit surged up 23.5% to £115.3m.
The group’s main Grocery division saw revenues increase by 13.4% to £693.4m. With eating out off the menu for much of the year, many of Premier’s major brands grew in double-digit terms, with Bisto, Oxo, Ambrosia, Sharwood’s, Homepride, Paxo and Nissin all said to be standout performers.
The group also hailed the success of new advertising campaigns and the introduction of ‘better for you’ options such as Sharwood’s 30% less sugar cooking sauce. Premier also benefitted from the strong growth in the online market with its sales in the channel increasing by 104%.
Meanwhile, revenue growth in the group’s Sweet Treats division was more muted at 2.2% as consumers focused on food staples at the start of the pandemic. However, Mr Kipling brand reached revenues of £150m for the first time, benefitting from TV advertising, increased sales of its reduced sugar ranges, and expansion of its premium Signature collection.
Chief Alex Whitehouse described the period as “outstanding”, adding: “Throughout the year, we continued to drive our branded growth model, launching a series of new product ranges, including many healthy options such as Sharwood’s low sugar stir fry sauces and increasing marketing investment with six of our major brands benefitting from TV advertising.
“This, along with a robust performance from our supply chain, ensured we delivered growth ahead of the market.
“Sales of our brands online more than doubled and our continued focus on this channel led to further market share gains. In overseas markets, we are now clearly seeing the benefits of last year’s change in strategy with double-digit growth in each quarter and 23 per cent in the full year.”
Looking ahead, the group said it was in a strong position having gained a larger consumer base during the past year. Premier stated that it will continue to employ its branded growth model, with further new product launches planned and six of its largest brands due to benefit from TV advertising during 2021. It also expects to deliver further progress overseas as it applies these strategies in its key international markets.
The group added that initial trading in its new financial year was in line with its expectations, set against a period of tough comparatives. And having made further progress on reducing its debts, Premier hinted that it was now in the market for potential acquisitions.
It concluded: “The Board is confident in the delivery of its full year profit expectations, and is set to benefit from substantially lower financing costs. As the group transitions to the next phase of its evolution, it will look to expand through accessing new categories in the UK and also in selected overseas markets, while exploring bolt-on acquisition opportunities.”
