Premier Foods Says Q1 Sales At 'Top End' Of Expectations
Premier Foods, the producer of Oxo, Saxa, and Bisto, has reported a 6.3% growth in sales over a two-year basis in the first three months of 2021.
The company added that this performance was at the 'top end' of the group's 5%-6% expected range, with branded sales increasing by 9.3%.
Total sales in the quarter amounted to £185.9 million, down from £214.1 million in the same period last year due to stockpiling during coronavirus lockdowns across the UK.
High Grocery Volumes
The decrease in sales compared to 2020 was expected as UK households consumed the majority of their meals at home during that time, leading to much higher consumption.
Online sales were similar to the high levels seen in 2020 and nearly double compared to 2019.
The Premier Foods group's strategy of growing by entering new categories is gathered pace, with sales from product ranges such as Mr Kipling and Cadbury baking mixes, Cape Herb & Spice, and Oxo Rubs and Marinades delivering over £6 million in the past year.
Alex Whitehouse, CEO of Premier Foods, said, "We have made a very encouraging start to the year, with first-quarter sales at the top end of our expectations, as our brands again benefited from the introduction of new products and continued marketing investment.
"As expected, overall sales were down compared to the same quarter a year ago when we saw exceptionally high grocery volumes during the first national lockdown."
In grocery, investments in the Premier Food Group's brands and new products have resulted in particularly strong progress for Ambrosia, Bisto, Oxo, Sharwood's and Paxo, which have all seen double-digit growth percentages compared with 2019.
Non-branded sales in grocery were lower than two years ago, reflecting a slow recovery in the group's out-of-home businesses during the quarter, partly offset by higher sales in retailer channels.
In sweet treats, branded sales increased by 3.2% versus a year ago as Mr Kipling continued to grow strongly, building on its best-ever sales in FY20/21, with sales up 7.5% in the quarter.
Cadbury cake sales were impacted by early Easter in the previous years, while lower-margin non-branded sales declined due to prior year contract exits.
Internationally, the business saw further growth, with sales up 2.5%, as it continued to benefit from its revised strategy and building on the previous year, when sales grew by 23.5%.
New products such as Bisto Southern Style gravy, Oxo meat-free stock cubes, and Mr Kipling Signature cakes have delivered market share gains, while recent launches into quick meals, snacks and soups and home baking categories are expanding further, the company said.
In North America, the trial of Mr Kipling cakes in Canada has delivered encouraging results with the planned rollout to full national distribution in the second half of the year.
In the USA, the business continues to work with Weston Foods as it prepares for the launch of Mr Kipling, building on insights from the Canada trial.