Northern Foods: Good weather aids trading

Leeds / UK. (nf) Seasonal demand for sandwiches and salads helped boost trading at Northern Foods PLC, the leading supplier of chilled ready meals and frozen pizzas to UK retailers. Good weather during the company´s first quarter to June 27 helped drive a nine percent increase in underlying revenue at its chilled food division, which provides a range of snacks to customers of Marks and Spencer, Tesco, Sainsbury´s and Morrisons.

Highlights in Q1/2009

  • Positive progress in the first quarter
  • Like for like sales growth up 5,5 percent
  • Increased volumes driving sales growth; volumes up 4,2 percent in the first quarter
  • Chilled growth of 9,2 percent driven by value lines
  • Further progress in Bakery; divisional sales up 6,8 percent
  • Frozen division benefiting from change programme
  • Expectations for sales and profits in the half and full year remain unchanged

Northern Foods, which produces 140 million ready meals a year for supermarkets in the United Kingdom, said (in its Q1 Interim Management Statement last week) the ready meals market, traditionally strongest in winter months, was also gradually returning to growth despite the warm summer weather.

Overall, like-for-like sales were up 5,5 percent, largely owing to volume increases. Sales in the bakery division, which produces supermarket own-label goods as well as Northern´s own Fox´s biscuits, rose by 6,8 percent as British snackers defied the downturn. For the first time Tesco overtook Marks and Spencer as Northern Foods´ biggest customer during the quarter, helped by the seasonal shift in sales from ready meals towards sandwiches and salads.

Sales fell, though, at Northern Foods´ frozen division, which supplies Goodfella´s and San Marco frozen pizza brands as well as pies, pasties and puddings to fish and chip shops, football grounds and supermarkets. Stefan Barden, chief executive, blamed the fall on the closure last October of its original pizza manufacturing site near Dublin. Pies continued to sell well as a cheaper alternative to fish at the country’s chippies, he said.

bakenet:eu
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