Premier Foods profit up on Mr Kipling sales; sees higher marketing costs (updated)
14/05/2019 07:43
(Adds details on results, outlook)
May 14 (Reuters) - Premier Foods Plc PFD.L reported a
higher annual pretax profit on Tuesday, boosted mainly by growth
in its largest brand Mr Kipling cakes, but warned that the first
half of the fiscal year would be slower as its spends more money
on marketing.
The OXO stock cube maker, which traces its history back to
the 18th century, said adjusted profit before tax rose 12.1% to
88 million pounds, while revenue rose marginally to 824.3
million pounds ($1.07 billion).
Analysts expected annual adjusted pretax profit of 84
million pounds, and revenue of 823 million pounds, according to
a company compiled consensus.
Premier Foods also said its strategic review was ongoing.
The company unveiled its plans to review options after
former boss Gavin Darby left at the end of January. He was under
shareholder pressure following a drop in the share price after a
takeover attempt by U.S. food maker McCormick & Co Inc MKC.N
fell through almost three years ago. urn:newsml:reuters.com:*:nL3N20M4JJ
Premier Foods has also been cutting costs as part of a
two-year plan launched in 2017 by laying off people and
streamlining its warehousing and distribution network.
The company said it expects its international business to
return to double-digit growth in the current fiscal year.
Premier Foods' international business did not enjoy the same
"universal success" during the year as it had in the previous
three years, it said, as revenue fell 12.5%, on Cadbury cake
overstocks and lower export distributor volumes.
The company has traditionally gained from its international
partnerships with Japan's Nissin Foods Holdings Co Ltd 2897.T
and Mondelez International Inc MDLZ.O , owner of the Cadbury
brand.
In the coming year, Premier Foods plans to invest money in
itself and increase consumer marketing.
(Reporting by Sangameswaran S and Noor Zainab Hussain in
Bengaluru; Editing by Shounak Dasgupta)
((Sangameswaran.S@thomsonreuters.com; within U.K +44 020 7542
1810; outside U.K. +91 80 6749 3544; Reuters Messaging:
Sangameswaran.S.thomsonreuters.com@reuters.net))