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Greencore Posts 'Resilient' Performance In Q1, Despite New Lockdowns

Convenience foods manufacturer Greencore said that it put in a 'resilient' performance in the first quarter of its financial year (to 25 December), despite the re-introduction of lockdowns in its core UK market.

The business saw group revenue down 15.0% in the period, to £312.7 million, with its food-to-go categories down 21.7% year-on-year. Other convenience categories were down 2.1%.

On a month-by-month basis, November saw the biggest decline in pro forma revenue in the quarter, with group sales down 17% and food-to-go categories down 24%. In December, group sales were down 14% and food-to-go down 20%.

'Challenging Period'

“This has been another challenging period for Greencore, and as ever I would like to thank all of our colleagues for the outstanding professionalism and resilience that they are showing," commented Patrick Coveney, Greencore chief executive.

"Although the difficult trading conditions are likely to persist in the near term, we remain confident that demand for our food to go categories will recover strongly as the effects of COVID-19 recede and mobility restrictions are removed."

The re-introduction of a UK national lockdown on 4 January means that group revenue is currently 20% below prior year levels, the group said, with pro forma revenue in its food-to-go categories currently running approximately 35% below prior year levels.

Brexit Impact

Elsewhere, the completion of the Brexit process has had only a 'modest' operational impact on the firm, as Greencore had 'completed extensive Brexit planning and was well prepared for any near term volatility in the supply chain'.

It noted that the ongoing uncertainty regarding the duration and impact of the COVID-19 crisis 'makes it difficult to predict FY21 performance', and as such , the business' financial guidance remains suspended.

"We secured a number of new business wins in the quarter and have a healthy commercial pipeline as we look forward," said Coveney. "In addition, the operational, debt and equity measures that we have taken in recent months provide us with a strong foundation from which to navigate our way through all of the challenges of COVID-19.

"We are confident that we have the capability and resources to build back the business rapidly as soon as market conditions allow, and we are optimistic about the medium-term prospects for Greencore.”

© 2021 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.

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