Greencore Group PLC Trading Statement (5248V)
January 31 2017 - 1:00AM
UK Regulatory
TIDMGNC
RNS Number : 5248V
Greencore Group PLC
31 January 2017
31 January 2017
Greencore Group plc
Continued strong revenue growth in UK Food to Go; good initial
progress with US integration
Greencore Group plc ("the Group") today issues a trading update
covering the 13 weeks to 30 December 2017 ("Quarter 1" or
"Q1").
Quarter 1 Trading
The Group recorded revenue of GBP417.0m in the 13 weeks to 30
December 2017, an increase of 17.1 % on the prior year on a
reported basis. On a like for like basis (expressed in this
statement on a constant currency basis and excluding revenue from
The Sandwich Factory acquisition in July 2016), revenue was ahead
by 9.1% in the quarter.
Convenience Foods
The Convenience Foods division recorded Q1 revenue of GBP401.6m,
16.4% ahead of the prior year on a reported basis and up 8.9% on a
like for like basis. In the UK, Q1 revenue was up 13.9% on a
reported basis and up 9.0% on a like for like basis (after
excluding the revenue from The Sandwich Factory acquisition). This
was driven principally by strong growth in our Food to Go business,
which continues to benefit from robust category growth and from the
roll-out of business wins announced in FY16.
The Group continues to invest for future growth. Construction of
the final new facility in Northampton has been completed, with the
commissioning of this facility progressing well. In Prepared Meals,
we are investing significantly in capacity and capability in both
our Wisbech and Warrington ready meal facilities, to support
renewed contracts in that business.
In the US, reported Q1 revenue was up 31.2%, and up 8.0% on a
like for like basis (after adjusting for currency), driven largely
by the addition of operations in Seattle. The business continues to
progress year on year, benefitting from an improved operational
performance. Our focus now is on delivering new revenue growth to
drive capacity utilisation and margin progression.
Ingredients and Property
The Ingredients and Property division, which now represents less
than 5% of Group revenue, recorded revenues of GBP15.4m in Q1,
GBP4.5m or 41.3% higher on a reported basis and 16.5% higher on a
like for like (or constant currency) basis. This growth has been
positively impacted by increasing demand in the global dairy
markets.
US Integration
The acquisition of Peacock Foods completed on 30 December 2016.
Trading in the Peacock Foods business was in line with expectations
upon completion. Our integration plan is already progressing well.
We will provide a more detailed update on the integration of our US
businesses, including progress on the combined commercial agenda,
at our half year results announcement on 23 May.
Outlook
The Group continues to deliver strong revenue growth in both the
UK and US, reflecting positive category growth and the roll-out of
new business wins. The integration of Peacock Foods in the US and
the related synergy delivery is on track, albeit the process is at
an early stage. Inflation in raw material and packaging prices and
labour costs are expected to increase for the remainder of the
year, although we anticipate that the combination of supply chain,
purchasing and pricing initiatives will mitigate these impacts.
Overall, the business is delivering a complex investment and change
agenda to drive both the US integration and the new capacity
additions that support the significant new business in the UK.
Notwithstanding these investment costs and their impact on the
phasing of profit delivery, we remain confident in our ability to
deliver FY17 performance in line with market expectations.
Capital Markets Activity
The Group intends to schedule two further capital market events
this year. Firstly, the business is planning to hold an analyst
visit to our expanded facility in Northampton, UK on March 28. In
addition, the Group intends to host a Capital Markets Day in
Chicago, US on June 19. More information on these events will be
distributed in due course.
Conference Call
A conference call for investors and analysts will be held at
8.30am GMT today. Dial in details are below and a replay facility
will be available afterwards at www.greencore.com.
Conference call details:
Ireland: +353 1 246 5601
UK: +44 20 3427 0503
US: +1 646 254 3361
Access code: 4210946
For further information:
Eoin Tonge Chief Financial Tel: + 353 1
Officer 605 1045
------------------ ---------------- --------------
Rob Greening/Nick Powerscourt Tel: + 44 207
Brown 250 1446
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NOTES TO EDITORS
1) Greencore:
-- A fast growing, international convenience food leader
-- In the UK: a leading manufacturer of sandwiches and other
food to go products to grocery retailers, with complementary
positions in other convenience food categories, including chilled
prepared meals, chilled soups and sauces, ambient sauces &
pickles, cakes & desserts and Yorkshire Puddings
-- In the US: a leading manufacturer of sandwiches, meal kits
and salads to CPG, convenience retail and food service leaders
2) This announcement is based on information sourced from unaudited management accounts
3) This announcement contains certain forward looking statements
with respect to the financial conditions, results of operations and
businesses of the Group. These statements involve risk and
uncertainty because they relate to events and depend upon
circumstances that will occur in the future. There are a number of
factors that could cause actual results or developments to differ
materially from those expressed or implied by these forward looking
statements. Nothing in this announcement should be construed as a
profit forecast
This information is provided by RNS
The company news service from the London Stock Exchange
END
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