Greencore Group plc (LON: GNC) have seen their shares sink on Tuesday after the firm gave shareholders a disappointing update alluding to declining annual revenues.
Greencore Group plc is an Irish food company, which was established by the Irish government in 1991. The firm now sells convenience food related and boasts itself as the largest sandwich manufacturer globally.
Shares of Greencore sunk 5.48% to 234p on Tuesday morning. 26/11/19 11:07BST.
Greencore have had a mixed financial 2019, as the firm reported struggles in July which led to shares slipping, however recover was made soon after.
The company, which prepares over 700 million sandwiches a year, said in an update on Tuesday that it had completed the sale of its US business for £55.9 million on Monday, which helped pre-tax profit triple to £56.4 million in the year to the end of September.
The FTSE250 (INDEXFTSE: MCX) listed firm reported declining sales from continuing operations by 3.5% to £1.4 billion in the year to the end of September.
Chief operating officer Peter Haden will also step down as an executive director at the end of December, before leaving the group in April, as part of a bid to “simplify the management structure”.
Patrick Coveney, chief executive officer, said he expects next year to deliver profitable growth, with a target to achieve mid single-digit organic revenue growth in the medium term.
He added, “over the past twelve months we have fundamentally reset our business”, saying that the group’s plan was “expanding our category and channel capabilities within the diverse, growing and attractive UK food to go market”, such as the recent £56 million acquisition of UK salad maker Freshtime.
House broker Shore Capital said Greencore was now “fully focused on the UK market, and with leading exposure within attractive ‘food to go’ categories”, seeing future growth being augmented by selective bolt-on deals and capital discipline.
The food and drinks industry have seen mixed results and firms have had limited success.
Firms such as J D Wetherspoon (LON: JDW) and Greggs (LON: GRG) have given shareholders strong updates seeing their shares rally.
Notably, Compass Group plc (LON: CPG) saw their shares sink this morning as the firm gave a gloomy outlook to shareholders for financial 2020.
