4th Dec 2018 08:55
LONDON (Alliance News) - Greencore Group PLC on Monday reported an increase in annual profit following a year of "significant" change, as the sandwich maker disposed of its US business and said it would return some of the proceeds to shareholders.
For the financial year ended September 28, the FTSE 250-listed firm's pretax profit increased 13% to GBP17.8 million from GBP15.8 million the year before on a 4.2% revenue increase to GBP1.50 billion from GBP1.44 billion.
The company's group operating profit was up 9.5% to GBP49.8 million from GBP45.5 million.
The company's Convenience Foods UK & Ireland division's adjusted operating profit, excluding reallocated central costs to discontinued operations, increased 3.6% to GBP110.6 million from GBP106.8 million.
In the UK and Ireland, Greencore's food to go categories generated pro forma revenue growth of 11%. The company also exited its UK cakes & desserts category to focus on ready meals.
The Irish convenience food producer proposed a total dividend of 5.57 pence, a 1.8% increase in the 5.47p paid last year.
"2018 was a year of significant change for Greencore. We delivered good underlying growth in the UK, with favourable consumer and retailer trends helping drive our core food to go business. After the financial year-end, we took the decision to sell our US business having received a compelling offer for it," said Chief Executive Officer Patrick Coveney.
Last month, Greencore completed the sale of its entire US business to Hearthside Food Solutions for USD1.08 billion.
The company's discontinued US operations posted a 29% increase in adjusted operating profit in the year on a 20% increase in revenue to GBP1.06 billion from GBP881.3 million.
The company said that following the sale, it is committed to returning GBP509 million to shareholders via a tender offer. The capital return is expected to be completed during the second quarter of financial 2019.
Coveney added: "We will now focus all of our attention and resources on the significant growth opportunities that we see in the UK, both organic and inorganic. Despite the short-term uncertainties of Brexit, our scale, depth and expertise in attractive and structurally growing food categories mean that we are confident in the future growth prospects for Greencore."
Elsewhere, non-executive directors Thomas Sampson and Kevin O'Malley will retire at the company's January annual general meeting in January, the company said.
Shares in Greencore were up 0.1% Monday morning at 183.95 pence each.
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