Premier Foods’ interim management statement has revealed sales of Hovis are up 11% for the four months to October.
According to the company, consumer response to the relaunch of its Hovis brand has been positive, and market share in October has improved. Part of the success has been put down to heavy investment in the brand prior to its relaunch, according to a spokesperson for Premier.
In the statement for the 17 weeks ending 25 October 2008, the company said its group trading profit was "in line with expectations", with group sales up 9% for the four months to October and up 8% for the year to date. Chief executive Robert Schofield said the company has built a strong platform through the integration of the RHM and Campbell’s businesses.
However, the company is undergoing a review of its capital structure, including ongoing discussions with lending banks, to "accelerate the reduction of group debt". These are expected to continue into the first quarter of 2009 and the decision has been made not to pay the 2008 interim dividend. The firm and the lending banks have also agreed that, due to the ongoing review, the next covenant test will be deferred from 31 December 2008 to 31 March 2009.
Last week it was reported that United Biscuits UK had made a secret £250m bid for the Mr Kipling brand, which is said to have been rejected.
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