Premier Foods posted a stronger annual profit and raised its dividend payout as the company offset higher input costs with price hikes and cost-cutting measures initiated in the last quarter of the year.
Britain's grocery sector had come under pressure from elevated costs and supply disruptions, but food prices are currently expected to stabilise in the coming months and next year.
Profit Performance
The maker of Mr Kipling cakes and Oxo cubes reported a 13% jump in adjusted profit before tax for the year ended April 1, to £137.2 million (€157.9 million), while analysts on average had forecast £135 million (€155.4 million)
Trading profit increased by 11.5%, with margins maintained compared with the previous year, as Premier Foods offset 'exceptionally high' input cost inflation through a combination of cost efficiencies and pricing, it said in a statement.
The period also saw it make its first acquisition in 15 years, with the takeover of the Spice Tailor brand.
"We know that consumer budgets remain under pressure in the current environment and our broad portfolio of brands continue to provide great options to prepare and eat good value, delicious meals at home," said Alex Whitehouse, chief executive.
"We are continuing to see consumers looking for convenient, affordable and tasty meal solutions and Batchelors and Nissin were two of our best branded performers in the year which benefitted from this trend."
Read More: Premier Foods To Acquire The Spice Tailor For £43.8m
Looking Ahead
The company raised its dividend for the year to 1.44 pence and retained its 2024 fiscal outlook.
"We will continue to pursue vigorously our five pillar growth strategy and with our positive momentum, including a good start to Q1, we are well placed to make further progress this year, and our expectations remain unchanged," Whitehouse added.
Read More: Premier Foods Raises Profit Outlook For Full-Year 2023
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