Booming food-to-go market drives growth at Greencore

Soaring food-to-go sales have driven a 9.2% rise in reported revenue for Greencore’s UK and Ireland operations.

The business, which yesterday announced its exit from the cakes and desserts market, said revenue from its food-to go business alone had risen 12.2% in the 13 weeks to 29 December 2017.

Food-to-go revenue rose 11.4% excluding the impact of the acquisition of the Tasties of Chester manufacturing facility in Heathrow last summer.

The performance has been driven by a combination of underlying market growth and previously announced new business wins with some of the company’s largest customers.

Greencore’s investment in the UK division had eased following “substantial spending” over the past two years. Its key remaining project, to refurbish and extend its Warrington ready meal facility in Warrington, is due to be completed next quarter.

The company reported that the sale of its Hull cakes and desserts business, and previously announced closure of its desserts facility in Evercreech, would not impact earnings, although there would be a charge of £15m to the income statement in its 2018 results.

Overall group revenue – including the US division – rose 53.6% on a reported basis to £640.5m in the quarter.

US sales rose 297.0% to £255.1m, primarily driven by the acquisition of Peacock Foods in December 2016. Excluding Peacock, revenue rose 5.1%.

Greencore said it expected to deliver strong growth in the current financial year, adding it was “well positioned to drive improved profitability, cash flow and returns over the medium term”.

That company also announced it has appointed Helen Rose, chief operating officer of TSB Banking Group, as a non-executive director with effect from 11 April 2018.

"Helen will bring deep operating knowledge, with a detailed financial focus and valuable experience of the food industry,” said Greencore chairman Gary Kennedy. “Helen's appointment will complement our strong, experienced Board and executive team.”

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