Premier Foods shares gained 1.2% to 112p in late morning trading on Wednesday after the firm announced a 6% growth in Q1 group sales year-on-year and a 4.2% growth in branded sales.
Premier Foods confirmed its Batchelors and Nissin brands performed well, with an increase in value meal sales as the cost of living crisis sent food inflation to 9.8% in June 2022.
The group mentioned all its brands benefited from price recovery in Q1, alongside slightly lower volumes linked to tougher comparatives reflecting Covid-19 restrictions the last year.
Premier Foods highlighted a strong non-branded growth of 17.1% on the back of strong home sales recovery and pricing benefit in retailer branded product categories.
Meanwhile, the company noted strong sales in its sweet treats sector, including Cadbury Cake, higher Mr Kipling sales and a positive reception to the healthier Mr Kipling range after its launch.
Its non-branded sales growth was attributed to contract gains in pies and tarts sales, and pricing benefits.
The foodstuffs company reported a 12% climb in international sales, with a highly positive performance in Australia and Mr Kipling’s highest ever market share in the country.
Premier Foods commented its Sharwood’s products returned high sales in Canada and Europe, with expected benefits over the coming year, along with strong Nissin noodles sales in Ireland and the UK.
“We’ve made a strong start to this financial year, growing sales by 6% in the quarter and again increasing market share both instore and online, as we continue to apply the elements of our branded growth model,” said Premier Foods CEO Alex Whitehouse.
“Our recently launched new products include a healthier range of Mr Kipling Deliciously Good cakes and authentic East Asian Sharwood’s cooking sauces while Mr Kipling benefitted from a new TV advertising campaign in the quarter.”
“Sales overseas increased by 12% due to a particularly strong cake performance in Australia, where Mr Kipling delivered its highest ever market share.”
Outlook
Premier Foods confirmed it was on track to deliver its FY 2022-2023 management expectations.
The firm reported a series of measures to recover inflation impacts, including pricing action and cost efficiencies.
“We have made good progress in recovering our input cost inflation through a range of measures, including cost efficiencies and pricing, and we continue to monitor the situation closely,” said Whitehouse.
“Consumers are increasingly looking to cook tasty affordable meals at home; this fits well with our broad portfolio of brands and was illustrated by the strong performance of Batchelors and Nissin in the quarter.”
“With this positive trading momentum behind us, we remain firmly on track to deliver our expectations for the year.”
