Frozen food company Nomad Foods has reported organic revenue growth of 1.8%, comprised of a 1.9% increase in volume/mix and a 0.1% decrease in price, in the first quarter of its financial year.
Reported revenue increased 3.6% to €707 million, while adjusted gross profit increased 8% to €215 million.
The adjusted gross margin increased 130 basis points to 30.4%, as a favourable mix in its base business, strong procurement execution, and lower promotional activity more than offset dilution from the Findus Switzerland acquisition.
Adjusted EBITDA increased 15% to €138 million and adjusted profit for the quarter grew 24% year-on-year.
The Birds Eye parent saw a 2% decline in adjusted operating expenses to €94 million, due to a normalisation of spend versus the same period last year, when operating expense growth was relatively elevated.
'A Strong Start'
Chief executive officer of Nomad Foods, Stéfan Descheemaeker, commented, "This year is off to a strong start with first-quarter revenue and adjusted EPS marking a record level of quarterly performance. We achieved healthy organic revenue growth notwithstanding year-ago comparisons which reflected elevated growth resulting from pantry loading at the onset of the pandemic."
"This was complemented by 180 basis points of Adjusted EBITDA margin expansion driven by strong gross margins and expense discipline. The combination of strong base business performance, the inclusion of Findus Switzerland and accretion from share repurchases in 2020 led to adjusted EPS growth of 42% in Q1. These results have us on pace to deliver another stellar year for Nomad Foods."
The company reiterated its 2021 guidance and has forecast a 3%-5% growth in revenue and adjusted EBITDA.
It has projected an approximate adjusted EPS growth of €1.50 to €1.55, representing 11%-15% growth.
Full-year guidance, which does not include the pending acquisition of Fortenova's Frozen Food Business Group, anticipates organic revenue growth of approximately 1-2%.
Co-chairman and founder of Nomad Foods, Noam Gottesman, said, "Organic growth, margin expansion and capital allocation all contributed to robust first-quarter results. This strong performance gives us further confidence in our 2021 guidance which will mark our fifth consecutive year of organic revenue and adjusted EPS growth.
"While we are proud of these results, we remain excited about the future as we work to capitalise on our momentum, integrate Findus Switzerland and close the acquisition of Fortenova's Frozen Food Business Group later this year."