Thursday, November 28, 2013

News: Greencore grows in quiche market

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Greencore, a leading manufacturer of convenience food, has seen an increase in turnover and profits but its UK operations took a hit from the horsemeat scandal.

In its financial results for the year ending September 27, the Irish-based firm reported that overall sales rose 3% on the previous year to £1.2bn, with pre-tax profit also rising from £28.9m to £45.2m.

Greencore has 28 sites in the UK and employ around 3,000 people in Yorkshire. Greencore Prepared Meals at Waleswood in Rotherham prepares quiches, tarts and Weight Watchers Foods.

The Rotherham facility bakes over a hundred thousand quiche a day and uses over 35 million eggs a year.

The Prepared Meals business comprises chilled ready meals, quiches, chilled soup and chilled sauces and represents approximately 25% of the company's "Convenience Foods" revenues. The reports stated that following several years of near double digit growth, the chilled ready meals market experienced growth in the 2013 financial year of just 1.4%, while the Italian ready meals market, a major sub-category, declined by 3.7%. Greencore said that this was predominantly driven by the impact of the horsemeat scandal which affected the broader processed beef market from late January.

It added that: "Although all industry tests on chilled ready meals were negative for the presence of horsemeat, the chilled ready meals market, and in particular Italian ready meals, was negatively impacted in Q2 and remained in year on year decline in H2. Both the chilled soup market and the quiche market exhibited more robust performances with soup ahead by 7.8% and quiche ahead by 7.6%, while chilled pasta sauces experienced a 1.2% decline."

On a like for like basis, revenue for the Prepared Meals business was 5.2% lower as a result of the decline in ready meals. This was offset by a 4.4% growth in the revenue of Greencore's Food to Go business, that accounts for 40% of "Convenience Foods" revenues and provides big name stores with sandwiches, sushi, snacks and salads.

In the UK, like for like revenue growth was 0.2% but in the US however, reported revenues were over 60% higher than the previous year due to new acquisitions and supply deals.

Patrick Coveney, CEO of Greencore, said: "Greencore had a good year in 2013, with clear commercial, strategic and organisational progress delivered across the Group. We consolidated our portfolio after the extensive deal activity of the three preceding years, increased revenue at our US business by over 60% and realigned our resources behind a food to go led strategy. All this was achieved despite a weak UK consumer environment, limited growth in retail food markets, persistent input cost inflation and the negative impact of the horsemeat scandal."

Greencore website

Images: Greencore

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