Greencore revenue rises 0.5% in third quarter of 2018

Greencore said reported revenue rose 0.5 per cent in the third quarter of the year, reaching £639.6 million for the period.

In the year to date, group revenue was £1.9 billion, an increase of 14 per cent year on year.

In the 12 weeks to June 29th, 2018, the company said its convenience foods UK and Ireland division reported growth of 1.4 per cent in revenue, driven by growth in the food-to-go business. Overall revenue was £375.9 million for the quarter, with food-to-go showing 10.7 per cent growth. Greencore said this was primarily down to increased revenue from the distribution of third-party products through its direct-to-store network. Underlying quarter-on-quarter category growth was modest, Greencore said.

The company said the elimination of cakes and desserts revenue saw other parts of the convenience foods division decrease revenue by almost 13 per cent. Greencore finished the phased closure of its desserts manufacturing facility in Evercreech in Somerset in June. It is also proposing to phase out long-life ready meals manufacturing in Kiveton in Sheffield as it moves towards fresher ready meals. Quiche and soup will continue to be made at Kiveton. The plan requires employee consultation; if approved, it is expected to close the unit in March 2019.

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Chief executive

Group chief operating officer Peter Haden is expected to become chief executive of Greencore UK in October.

The US convenience foods division saw a fall of 0.8 per cent in revenue for the quarter to £263.7 million. But pro forma revenue saw growth, driven by the former Peacock Foods business.

The group is focusing its US strategy on the branded food partner channel, and has appointed a chief executive of Greencore USA. Anton Vincent stepped into the role in July.

The company has experienced some difficulty in the US market, forcing it to restructure its operations centred around Peacock Foods, which it bought in 2016 for €633 million. Greencore stopped production at its loss-making Rhode Island plant, only three years after opening it, and plans to incorporate sites in Minneapolis, Minnesota and Jacksonville, Florida into the Peacock network.

Looking ahead, Greencore reiterated its full-year guidance for 2018, with adjusted earnings per share in the range of 14.7p-15.7p.