29th Jul 2014 09:29
LONDON (Alliance News) - Convenience food maker Greencore Group PLC Tuesday said sales continued to rise in its third quarter, driven by strong growth in the UK food-to-go market, and said it remains confident on delivering adjusted earnings per share growth in line with market expectations for the full financial year.
The Irish convenience food business said revenue in the third quarter ended June 27 increased to GBP326.4 million, up 6.7% on the prior year and up 7.5% on a like-for-like basis.
For the year so far, Greencore said revenue has risen 7.7% on a reported basis to GBP946.2 million, up 9.3% on a like-for-like basis, boosted by strong growth in its convenience foods division.
The group said the convenience foods division recorded revenue growth of 8.7% on a reported basis in the third quarter to GBP310.5 million. Within this business, in the UK like-for-like revenue was 10% higher than the prior year, supported by good growth in both its prepared meals and grocery businesses.
"While the overall grocery market [In the UK] remained challenging, the food to go market was buoyant throughout the period driven in part by growth in small store formats," the company said in a statement.
In the US, Greencore said constant currency revenue was almost 17% higher than in the prior year, including the contribution from the recent acquisition of food-to-go products manufacturer Lettieri's.
The group is scaling up in the US; it is planning to build a new greenfield sandwich making facility in Quonset, Rhode Island for GBP20 million, and make a GBP6 million investment in its Jacksonville facility in Florida so it can manufacture frozen food-to-go products.
Greencore said its ingredients and property division now represents less than 5% of overall revenue for the group, and recorded revenues of GBP15.9 million in the third quarter.
Greencore also said that it has concluded an agreement for the sale of residential land in Littlehampton, West Sussex, and it expects to received net proceeds of approximately GBP16.5 million in the current financial year.
"The group is operating with good headroom within existing debt facilities and remains focused on further de-leveraging whilst taking opportunities to invest in future development in support of its customers," the company said.
Greencore shares were up 1.2% at 277.82 pence Tuesday morning.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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