Premier Foods Shares Rise: Forecasts Full-Year Profit at Upper End After Robust Christmas Trading

Premier Foods (LON: PFD) shares climbed more than 4% shortly after the open on Wednesday, after the company said it anticipates full-year trading profit to reach the upper end of market expectations, buoyed by a strong Christmas trading period.

Branded revenue surged 5.2% in the third quarter, driving total revenue up 4.1%.

Headline Numbers:

• Branded Revenue: Increased 5.2% in Q3.
• Total Revenue: Rose 4.1% in Q3.
• New Categories Revenue: Jumped 29%.
• International Revenue: Grew 10%.

Grocery Branded revenue led the charge with a 5.8% increase, while Sweet Treats Branded revenue saw a 3.1% rise. Premier Foods also gained market share in both the Grocery and Sweet Treats segments, showcasing the strength of its brand portfolio.

The company's strategic acquisitions, including The Spice Tailor, FUEL10K, and Merchant Gourmet, all delivered double-digit revenue growth, indicating successful integration and leveraging of Premier Foods' commercial expertise.

Premier Foods' focus on product innovation is paying off, with new ranges like OXO Bone Broth, Paxo Stuffing Wreath, Angel Delight Bubble Jelly, and Mr Kipling Cake Bites tubs resonating with consumers. Premium ranges such as Ambrosia Deluxe and Mr Kipling Signature Mince Pies also outperformed the market during the festive season.

The international business experienced a resurgence, with revenue up 10%, driven by strong performances in Australia and the US. The company is expanding its reach, securing listings for FUEL10K Granola in Europe, effective from Q4.

The strong Q3 performance has led management to revise its full-year trading profit expectations upwards. The company's portfolio of brands, which offer consumers affordable meal options, coupled with its track record of performance through various economic cycles, underpins confidence in its medium-term prospects.

Driver Breakdown:

• Product Innovation: New product ranges and premium offerings drive revenue growth.
• Strategic Acquisitions: Acquired brands contribute significantly to overall growth.
• International Expansion: Strong performance in key markets like Australia and the US.

CEO Alex Whitehouse stated, “We had a really good Christmas with 5.2% branded revenue growth… These results demonstrated strong delivery against all pillars of our strategy, with consumers continuing to choose our brands for their quality and value,” reinforcing the company’s commitment to delivering value to consumers and shareholders alike.