Premier Foods beat market expectations for its full-year profit, supported by robust demand and increased marketing spend.
The company, which makes a variety of food products from plain flour to cooking sauces and quick meals, expects a return to volume-driven revenue growth this year as consumers chose to eat at home rather than going to restaurants as inflationary pressures loom.
'We have a strong set of plans for this year, across each of our strategic pillars and with our return to volume growth, we are on track to deliver on full-year expectations,' the company said in a statement.
Premier Foods also benefited from the lower promotional price points it introduced in the third quarter as volumes returned to growth in the fourth quarter.
'Considerable Progress'
"This has been another really strong year for the business with considerable progress across all our key financial metrics and five pillar growth strategy," commented Alex Whitehouse, chief executive. "In the UK, branded revenue increased by 13.6%, accompanied by 29 basis points of market share gain, as we continued to outperform the market."
The maker of Mr Kipling cakes and Oxo cubes posted £157.9 million (€184 million) as its adjusted profit before tax for the year ended March 30, a 15.1% jump from a year-ago period.
Analysts, on average, had forecast annual profit to come in at about £153 million, according to a company-compiled consensus.
'Financial Discipline'
"We continue to maintain our strong financial discipline; leverage reduced to 1.2x Net debt/EBITDA this year, our lowest ever level, and we are proposing another 20% increase in the dividend," Whitehouse added.
"We have a strong set of plans for this year, across each of our strategic pillars and with our return to volume growth, we are on track to deliver on full year expectations."
Additional reporting by ESM
