The manufacturer’s fourth-quarter total sales grew by 1.4% to £185.5M, compared with the equivalent quarter a year ago.
Trading profit over the year was £131M, in line with the company’s expectations. Pre-tax profits increased by £2.9M to £86.1M.
During the past year, the group reported investment both in brand marketing and new product launches. Six of the group's eight largest brands: Bisto, Oxo, Loyd Grossman, Sharwood’s, Mr Kipling and Cadbury cake all grew sales by an average of 3.4%.
Two other major brands Ambrosia and Bachelors saw sales fall by 2.9%. Both brands would receive increased marketing investment during the 2016/2017 financial year, said the firm.
Grocery Division sales
The firm’s Grocery Division sales reached £548.6M during the year. Sweet Treat Division sales rose by 3.4%.
Premier Foods had continued to expand its range by responding to consumers’ demand for more healthy choices. Launches included the ‘Exceedingly Good’ range of Mr Kipling Snack Pack slices, containing ingredients such as oats, cranberry and coconut, and the launch of Bisto reduced salt.
The manufacturer also reported increasing the vegetable content of its Loyd Grossman, Sharwood’s and Homepride cooking sauces.
‘New innovative products to market’
Premier’s ceo Gavin Derby said: “We are pleased to report sales growth in the year and the fourth quarter, in what continues to be a deflationary market. Our strategy of investing behind our brands and bringing new innovative products to market continues to deliver very positive results, with six of our major brands growing on average 3.4% in the year.
“The Sweet Treats business reported sales growth in every quarter of the year, while the international business also displayed excellent progress during the year with sales up 18%.
“We recently set out some additional strategic objectives which we believe will further accelerate our growth and now expect to deliver sales growth of 2–4% in both financial year 2016/2017 and the medium term. The potential opportunities presented by our partnership with Nissin are also very exciting.”
In the analyst’s view
Joshua Raymond, market analyst and foreign exchange broker at XTB.com:
“Premier Foods reported a 2.9% growth in adjusted earnings before tax to £86.1M for its full year, in line with guidance, with total sales rising 0.6%.
While the full-year result was in line with forecasts, the main positive was an upgrade to its 2016/17 sales growth, where the firm now expects sales to grow between 2% and 4%. Alongside this, it' also good to see branded sales – which contributes to 88% of total sales – grew by 1% in the fourth quarter in an otherwise flat growth year.
“So, this raises the expectation that sales can recover even stronger in the next year, hence the sales forecast upgrade.
"All in all, this is a report that shareholders will digest well.”