Waitrose and M&S meal deal supplier Greencore reports revenue boost by a fifth
A sandwich and sushi maker supplying UK supermarket giants from M&S to Waitrose has reported a surge in revenue after upping its prices – and revealed it axed around 250 jobs.
Greencore told investors it sunk to a loss this year after battling higher costs.
The Dublin-based convenience food manufacturing firm said its revenue jumped by a fifth to £926 million in the six months to the end of March, compared to the same period last year.
It said around 14.5 per cent of the jump in sales came from cost inflation “recovery” – meaning Greencore passed on higher manufacturing costs through raising prices of its food products.
It came as the group faced cost inflation of about 15 per cent during the half-year, impacting key commodities like raw materials and packaging.
The business said it had also partially mitigated the impact through operational efficiencies, making changes to ranges and redesigning packaging.
Greencore supplies packaged food to all major UK supermarkets including Sainsbury’s, Tesco, M&S and Asda, as well as chains including Starbucks and Caffe Nero.
It said sales of some of its convenience food like chilled ready meals and sauces soared by nearly 29% over the period.
However, the food giant swung to a pre-tax loss of £6.2 million from a £1 million profit the prior year.
This was partly because of higher costs and rising interest rates impacting its debt.
Furthermore, Greencore said it had “accelerated a headcount reduction programme”, which resulted in the reduction of around 250 roles by the end of March.
The firm, which has around 14,000 staff, said it expects its full-year earnings to be in line with current market expectations.
Dalton Philips, Greencore’s chief executive, said: “We are pleased to have delivered strong revenue growth in the seasonally quieter first half of the year, and it is a clear demonstration of Greencore’s ongoing resilience in what is a difficult consumer spending environment.
“While much of the top line momentum has been driven by recovery of inflation, it is encouraging to have achieved good manufactured volume growth, which speaks to the enduring structural demand for the categories in which we operate.
“We remain confident in the long-term potential for the business and our immediate priority is to rebuild profitability and returns in order to create a platform on which to build for future growth.”
By Anna Wise, PA Business Reporter