Irish food group Greencore Plc said it expects its full-year outturn to be at the 'lower end of market expectations' as industrial action and slow recovery from inflationary pressures hit demand and volumes.
First-quarter revenue at the group increased by 19% year-on-year to £463 million (€526.5 million), the group said, driven by inflationary effects, with manufactured volumes slightly down year on year.
Revenue in its Food to Go business was up 14.5% in the quarter, again driven by inflationary effects, while its Other Convenience arm saw revenue up 27.6%, boosted by a new business win.
'Difficult, Volatile Market'
"It's a difficult, volatile market, and the business has got off to a slower start to the year than envisaged," said chief executive Dalton Philips.
"Given this, we are doubling down on our initiatives on inflation recovery, and in parallel, driving harder and faster to get our cost base to the right level."
Greencore said that while inflation has been easing in some raw materials and packaging, labour and energy costs continued to hit earnings.
The group said it is focusing on recovering costs from customers.
'Strategically Well Positioned'
Four months into his tenure as chief executive, Philips added that he remains "highly enthusiastic about the longer-term future of Greencore. Strategically we are well positioned for the future growth given our customer base, the categories in which we operate, our operational capabilities and critically the people behind all of this.
"However, the immediate focus is to tackle the shorter-term self-help actions which set the foundations for margin recovery.”
News by Reuters, additional reporting by ESM – your source for the latest private-label news. Click subscribe to sign up to ESM: European Supermarket Magazine.
