Greencore said it expects strong growth this year, helped by the predicted performance of its convenience foods division.

The company said the underlying performance of the division remained good in the first three months of its fiscal year 2011, which ended on December 24th.

Revenue of €2.08.7 million was recorded for continuing business over the three months, rising 7.6 per cent compared to the same period a year earlier, and an increase of 3 per cent on a constant currency basis. The rise came despite adverse weather conditions in December.

The food to go and prepared meals sectors remained strong over the period, the company said.

The US business was trading in line with expectations, it said.

Greencore noted that ingredient and packaging inflation was more pronounced than the previous year, as expected. This is being managed through increased selling prices and cost reduction initiatives.

Meanwhile, interest expense is expected to decrease this year as the impact of disposals and the related debt restructuring is felt.

The company has sold off a number of units as part of its stated aim to concentrate more on its British and US convenience food businesses.

Last year’s disposals included the sale of its malt business to French co-operative Axéréal Union De Coopératives Agricoles in a deal worth up to €116.25 million. The plan was announced in February and, despite opposition from growers, was approved by shareholders the next month.

In July, the company said it would sell its Dutch convenience food business, which was expected to net it €12 million, although an exact figure was not disclosed at the time. A subsidiary of European investment firm Parcom, Convenience Foods Europe bought the Greencore Continental unit.

Greencore is still backing a proposed merger with Northern Foods, which would create Essenta Foods. Shareholders will meet to vote on the proposal at the end of January.