Greencore revenue falls amid 'challenging' UK grocery market
Food group Greencore has reported a fall in turnover amid what it said was a "challenging quarter" for the UK grocery sector.
Reported revenue from continuing operations fell 2.9pc year-on-year to £365m (€403m) in the three months to 28 June, which it said was mainly due to the impact of site disposals and UK business exits.
But on a pro forma basis, revenue increased by 0.8pc in the quarter, according to a trading update from the group.
In the nine months to-date, the company’s reported revenue from continuing operations was £1bn (€1.1bn), a decrease of 4pc on the prior year on a reported basis, but 3.8pc higher on a pro forma basis.
In Greencore's food to go categories, reported revenue was £250.6m (€277m) over the three month period, an increase of less than 1pc on the prior year. This reflected weak market conditions with unseasonal weather and a varied trading performance across the customer portfolio, which was set against a strong comparative period, the group said.
Year-to-date, reported revenue in food to go categories was £697.8m (€770m), an increase of 4.6pc year-on-year.
Meanwhile, reported revenue in the group's other convenience food categories totalled £114.3m (€126m) in the three month period, down 9.8pc on a reported basis, but up 1.4pc on a pro forma basis, again reflecting disposals and business exits.
Looking forward, Greencore said it is "performing well" against its strategic and financial objectives, despite the soft underlying revenue growth over the past 13 weeks.
"The final quarter represents a seasonally important period for Greencore and the group continues to anticipate growth in adjusted operating profit for the full year supported by underlying revenue growth and a good operational performance," it said.
The company expects its financial year 2019 net debt to earnings ratio to be at the lower end of its medium term target range of between 1.5 times to 2 times.