26th Nov 2019 09:01
(Alliance News) - Greencore Group PLC on Tuesday raised its annual dividend as profit increased, despite a decline in revenue following a reset of the group's business.
Shares in Greencore - which is headquartered in Dublin - were down 5.7% at 234.20 pence on Tuesday in London, the worst performer in the FTSE 250.
The food producer also announced that Chief Operating Officer Peter Haden will step down from his role with effect on December 31, and leave the company on April 12, 2020.
The decision follows Greencore's exit from the US market last year and a change in strategy, leading to a need to simplify the management structure. Haden has been part of Greencore for four years since 2015, and had been appointed to the board in May.
For the financial year ended September 27, Greencore made a pretax profit of GBP56.4 million, more than tripled from GBP17.8 million the year before.
On a reported basis, the profit included an exceptional gain of GBP55.9 million in profit from the disposal of Greencore's US business, and a GBP25.4 million charge on the restructuring of debt following the sale.
In November 2018, Greencore completed the sale of its entire US business to Hearthside Food Solutions LLC for USD1.08 billion.
On an adjusted basis, pretax profit rose by 16% to GBP92.3 million from GBP79.6 million, mainly due to operating profit nearly doubling to GBP99.8 million from GBP49.8 million.
Revenue however, declined by 3.5% to GBP1.45 billion from GBP1.50 billion the year before, the drop driven by the impact of site disposals such as in Hull and Evercreech in the UK, and the phasing out of manufacturing of longer-life ready meals at its Kiveton facility.
Greencore declared a dividend of 6.20 pence per share, up 11% from 5.56p the prior year.
Looking ahead, Greencore said it expects a "year of profitable growth" for the current period. In the medium-term, the group is targeting mid single-digit organic revenue growth and a high single-digit rise in adjusted earnings per share.
"Over the past twelve months we have fundamentally reset our business, anchored by a clear strategy to drive shareholder value by expanding our category and channel capabilities within the diverse, growing and attractive UK food to go market. The evidence of this can be seen in the launch of multiple commercial and innovation projects with key customers, and in the recent acquisition of Freshtime," said Chief Executive Officer Patrick Coveney.
By Dayo Laniyan; [email protected]
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