Thursday 26 April 2018

Revenue at Greencore tops €720m in 13 weeks

Company warns on currency fluctuations

Patrick Coveney, chief executive of Greencore – his total remuneration fell to £1.44m last year
Patrick Coveney, chief executive of Greencore – his total remuneration fell to £1.44m last year
Ellie Donnelly

Ellie Donnelly

Revenue at convenience food giant Greencore topped £640.5m (€726m) in the 13 weeks to 29 December, a 53.6pc increase year-on-year on a reported basis.

On a constant currency basis revenue was up 7.2pc during the three month period, according to a trading update from the company.

In the convenience foods market in Ireland and the UK, the Patrick Coveney-led company recorded revenue of £385.4m, an increase of 8.7pc on the constant currency basis in the three month period.

The growth was driven by the company's Food to Go business, which recorded double-didgit growth in the three month period.

The company, which yesterday announced plans to sell its cakes and desserts business in Hull, said that the sale of the business in Hull would lead to a one-off charge of approximately £15m to the income statement in its financial year 2018 interim results.

In the US the group recorded a revenue of £255.1m, an increase of 5.1pc year-on-year on a constant currency basis, which primarily reflected the acquisition of Peacock Foods at the end of December 2016.

Commercial activity with core Consumer Packaged Goods ("CPG") customers was described as "encouraging", with strong underlying trading as a result of category growth and previously announced business wins.

The broader commercial pipeline was also developing well, Greencore said.

The company also said that it had intensified its focus on enhancing network efficiencies in the US.

The company said that the reduction in the US corporate tax rate to 21pc would lead to an expected one-off, non-cash, credit of approximately $28m to the income statement in its financial year 2018 interim results.

"It is also expected that Greencore will benefit from the lower rate of corporate income tax on future taxable earnings in its US business."

Looking forwards, the company, which is the largest sandwich maker in the UK, said it expected to deliver a year of "strong" growth in 2018, however it warned that recent currency fluctuations, if sustained, would have an adverse impact on its translated US profits.

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