THE "key debate" for Greencore's future performance remains the extent to which longer-term consumer buying habits will impact the company's economic and growth model, according to Davy Stockbrokers.
In a report on the food group, Davy analyst Roland French said he was further cutting his operating profit forecasts for Greencore by 13.3pc for 2020 and by 25.2pc for 2021.
He predicts Greencore - the biggest sandwich maker in the UK market - will now generate operating profit of €61.6m this financial year, and €74.5m in 2021.
Mr French doesn't believe Greencore's like-for-like revenue growth will return to pre-Covid-19 levels until October next year. He had previously estimated they would hit that level in March 2021.
Greencore is also assuming its revenue run-rate will return to 2019 levels by October 2021.
"The acceleration online, increased propensity to work remotely and focus on hygiene will shape the response of the retailer and supplier, both of whom have suffered from lower footfall in the store perimeter," said Mr French.
He said Davy has lowered its life-for-like revenue growth assumptions for Greencore by 2.3pc for 2020 and 5.8pc for 2021.
"We note the initial surge behaviour seen in ready meals has dissipated, reflecting the move by consumers back towards home cooking," noted Mr French.
Last week, as Greencore released interim results, CEO Patrick Coveney said the group's sales volumes "fell rapidly" as lockdowns started. Its food-to-go category saw weekly sales volumes tumble by up to 70pc as retailers such as coffee shops and convenience stores closed.
Mr Coveney said sandwich consumption remains strong at locations which are open while, where people are making lunch at home, 60pc of the time they make sandwiches.
"Each week for the last five weeks, consumer satisfaction with their lunch has fallen," he said, citing Greencore research. "Consumers are getting bored and frustrated with the absence of choice."
Greencore said it generated £712.7m (€798.6m) in the six months to the end of March, with adjusted ebitda edging 2.1pc higher to £63.8m (€71.5m).
The Irish food group continues to be linked to speculation that it might try to buy UK food-to-go company Adelie Foods, which collapsed into administration this week.
It employs 2,000 people and supplies customers such as forecourt retailers.
Industry publication 'Better Retailing' reported this week that Greencore had been earlier blocked by the UK's competition watchdog from acquiring Adelie Foods but that, given the firm is now in administration, the Irish group continues to circle it.
The latest set of publicly available accounts for Adelie Foods show it posted revenue of £248.5m (€276.8m) and a gross profit of £57.7m (€64.2m) in its 2018 financial year.
The figures were up 10pc and 22pc respectively on 2017. It made an earnings before interest, tax, depreciation and amortisation (ebitda) loss of just under £3m (€3.3m) - an improvement on the £8.2m loss the previous year.