Thursday March 27, 07:28 AM
Northern Foods full-year profit to beat expectations
LONDON (ShareCast) - Northern Foods (LSE: NFDS.L - news) ' trading performance continued to meet expectations and the ready meals
group said it now sees full-year profit before tax and restructuring items ahead of the median consensus of £47.5m.In the full year to 29 March, underlying revenue grew by 3.2%, with prices up 2.4% and volumes up 0.8%. Underlying operating margin has been maintained year on year. Fourth quarter underlying revenue increased by 3.9% over the corresponding year quarter on flat volumes. The group said it continued to fully recover commodity cost increases. The chilled division continued to grow strongly, with fourth quarter underlying revenue up 5.5%. The frozen division saw underlying revenue grow by 2.8% in the fourth quarter. Average prices were 5.1% higher, while volumes declined 'modestly'. Operating margin has continued to be constrained, the group added, with a strengthening Euro adversely impacting underlying profitability in its Irish businesses by over £1.5m in the current year. Full year underlying revenue for the division declined by 0.6%, but Northern Foods said the integration of the McDougall's pastry business, completed in March 2008, will benefit the new financial year. The bakery division saw a 1.1% rise in underlying revenue in the fourth quarter, with full-year underlying revenue up 2.9%. Average prices were 7.5% higher as a result of commodity cost recovery. "We are operating in a volatile trading environment with inflationary commodity prices," said chief executive Stefan Barden. "However, we are confident that we will continue to make steady progress in realising the full potential of the business," he added.
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