GREENCORE YESTERDAY announced a solid start to its 2011 financial year, as it reported a 3 per cent increase in revenue on a constant currency basis for the three-month period ended December 24th.
First-quarter results showed that when currency effects are stripped out, revenues rose by 7.8 per cent in the quarter, compared to the same period last year.
Total sales topped €208.7 million during the period, despite the inclement weather in the UK.
Some 85 per cent of Greencore’s profits come from the UK, where the company is a provider of sandwiches and convenience foods to retailers such as Tesco and Asda.
The growth in Greencore’s overall revenue was driven by the strong performance of the convenience foods division, despite a rise in input costs. Convenience foods account for about 90 per cent of the company’s profits.
Greencore said it is addressing the current spike in ingredient and packaging prices through a combination of higher charges and cost-reduction initiatives.
The US business also traded in line with expectations, according to the company.
Greencore said it expects to deliver strong growth on a continuing basis for the full year 2011, though this is dependent on currency exchange rates.
The group again outlined the case for its proposed merger with Northern Foods, saying it “represents a compelling opportunity for value creation for both Greencore and Northern Foods shareholders, through the creation of a business with real scale in the industry and substantial synergies.”
Shareholders are due to vote on the deal on January 31st, although British businessman Ranjit Boparan may pose a counter-bid for the London-listed company by next Friday. Greencore’s shares shed 0.2 per cent yesterday to finish at €1.315.
