Greencore Sees H1 Revenue Down 19%, Notes 'Encouraging Momentum' In Food-To-Go
The prolonged COVID lockdown period impacted sales at convenience food producer Greencore in the first half of its financial year, however the business has noted 'encouraging revenue momentum' in its food-to-go operations in recent weeks.
Group revenue was down by close to a fifth (-19.0%) in the first-half period, to £577.1 million (€668.9 million), driven by 'the reduction in consumer mobility as a result of tiered restrictions and lockdowns in the UK', the group said.
The group reported an adjusted operating profit of £0.2 million, adding that it maintains a 'strong liquidity position' with cash and undrawn committed debt facilities of £302 million as of the end of the period.
It said that it is working with a number of key customers to renew and extend existing relationships, while it is also 'actively pursuing' a pipeline of new business opportunities. It also recently announced a new sustainability strategy.
Since period-end, Greencore said that it has seen pro forma revenue in its food-to-go categories over the first seven weeks of H2, with revenue running at around 123% above prior year levels (and 14% below the equivalent pre-COVID levels in 2019).
It is anticipating a 'continued reopening' of the UK in line with the current roadmap, adding that a 'consequential rebuild' of group revenue would enable it to post a full-year operating profit above that of the previous year.
Cause For Optimism
“This has been a challenging period for Greencore, but the consistent build in our revenues since early March as lockdown measures have eased and COVID-19 cases have fallen give us real cause for optimism," commented Patrick Coveney, chief executive. "Our focus now is on rebuilding revenue, profitability and cash flow momentum as the UK economy reopens."
Coveney added that the group is "confident of being able to build back the business rapidly and profitably, and are optimistic about the medium-term prospects for Greencore.”