Premier Foods reported a rise is sales of 5.3 per cent for the first quarter of the year on strong branded sales growth, as it maintained its forecast for 2024.
Sales of Mr Kipling and Asian meal kit The Spice Tailor boosted the company’s branded sales by 7.3 per cent, to £213.8m from £199.3m last year.
“We expect to see more volume led branded sales growth in the coming quarters,” chief executive Alex Whitehouse said.
Non-branded sales fell by 16 per cent, reflecting the movement of consumers to brands this year; data out from Kantar earlier this week showed that sales of branded products outpaced own-label items in the four weeks to July 7.
Premier Foods, which also owns Sharwoods, Bisto and Ambrosia, said group sales for the first quarter ended June 29 rose by 5.3 per cent year on year to £239.3m.
International sales grew by 24 per cent, with “strong growth in overseas regions”, while sales from new categories increased by 68 per cent, led by Ambrosia porridge pots and Angel Delight ice-cream, the company said.
“As we look forward to the rest of the year, we have a strong set of marketing and product innovation plans for our brands in the UK and Ireland, while we continue to build distribution internationally,” Whitehouse said.
“The UK competitive environment remains intense, as it has been for years, but normalisation is also evident in the easing off in private label gains as proprietary brand manufacturers seek to reclaim some ground, reflected in moderately elevated promotional activity.
“We continue to see opportunities for Premier’s brands across the UK grocery distribution channels, including bargain stores and convenience, the latter for which a dedicated team operates,” an analyst at Shore Capital said.
“The company has begun to demonstrate how effectively it has switched from value to volume growth and is delivering on all its strategic priorities,” an analyst at Peel Hunt said. The firm reiterated its Buy reccomendation.
Shares soared earlier this year after the company reported a £33m windfall from suspending pension deficit payments early.