PREMIER Foods says its latest half-year results suggest concentrating on its ‘power brands’ is working.
The company, which has a factory in Bury St Edmunds and a distribution centre at Mendlesham, has seen a two per cent rise in sales of its eight power brands and its trading profits are up 3.2 per cent compared to the first half of 2011.
However, the group’s net debt at June 30 was £1,269.4 million, which includes an additional £188.1 million loan taken out in December..
Premier’s power brands are Loyd Grossman sauces, which are made at its Mildenhall Road factory, Ambrosia, Bachelors, Mr Kipling Cakes, Bisto, Oxo and Hovis.
Its half-year report, published on Tuesday, says: “Power brands sales increased by 2.0 per cent owing to strong performances by Loyd Grossman, Batchelors and Mr Kipling; this growth has also been reflected in market share gains across the power brand categories, especially during the second quarter.”
Premier’s sales excluding milling are £757.1 million compared to £749.1 million this time last year, an increase of 1.1 per cent, but the power brands are up £8.4 million to £418.9 million.
Michael Clarke, chief executive, said: “I’m pleased with the progress we are making to stabilise the business, re-focus the portfolio and invest in our future growth. Our strategy of focusing on our Power Brands is starting to gain traction.
“Plans to simplify the business and drive further efficiency and effectiveness are proceeding ahead of plan and we will now deliver the previously announced £40 million savings by the end of 2012.
“As we continue our divestment programme, we plan to take further costs out of the business.
“We remain cautious given the current economic and trading environment and our full year expectations remain unchanged.”
In June, Premier sold three or its pickles and vinegar brands to a Japanese company, including pickled beetroot and picalilli made in Bury.
It still makes Branston and supermarket own label brands in Bury.