The latest trading update from fresh produce firm Total Produce "underscores the resilience of its trading model", a leading industry analyst has said.
Roland French of Davy was commenting following the publication of a six-month update by the group, in which it said that trading is expected to be broadly in line with the previous year.
'Satisfactory' Performance
Total Produce said that trading for the six months 30 June has been 'satisfactory', with sales proving 'resilient' in the face of the COVID-19 pandemic.
'The Group’s strong presence in the global fresh produce industry, the diversity of its operations and products, together with the exceptional response from our people, have enabled us to meet the challenges,' it commented.
It said that it expects 'satisfactory' results for the full year, subject to the continued uncertainties arising out of the COVID-19 situation.
Ahead of Expectations
Davy analyst French said that the group's full-year forecast is around 3% ahead of its own expectations for the group.
"Recognising the unprecedented economic backdrop and the group’s exposure to locked-down (foodservice) channels, this is a notably strong performance and provides comfort for our full-year forecasts," he noted.
"Trading on less than 9x FY 2020 P/E, the stock is materially mis-priced. We reiterate our ‘Outperform’ rating."
Sustainability Report
Elsewhere, Total Produce recently published a Sustainability Report, to coincide with World Environment Day, in which the company said that it had reduced its group energy consumption by 20%, achieving 100% renewable electricity across its 22 Irish businesses.
“For companies such as Total Produce”, group chief executive Rory Byrne commened, “expectations are clear. We must be uncompromising in the pursuit of best practices and responsible in our consumption of fragile natural resources.
"We must respectfully, and constructively engage with the communities in which we work.”
© 2020 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.
