FDBusiness.com

Greencore Group, a leading manufacturer of convenience food in the UK, has reported a 4.2% increase in revenue from continuing operations to £1.499 billion for the year ending 28 September 2018. Adjusted operating profit rose by 3.6% to £110.6 million, with improved profits in food to go categories being partly offset by a decline in other activities, notably ready meals.

Headquartered in Dublin, Ireland, Greencore holds strong market positions in many UK convenience food categories including sandwiches, sushi, salads, chilled ready meals, chilled soups and sauces, chilled quiche, ambient sauces & pickles, and frozen Yorkshire Puddings. Greencore recently completed the sale of its entire US business to Hearthside Food Solutions for US$1.075 billion (£817 million) on a cash and debt-free basis. The disposal leaves Greencore focused on the UK convenience food market.

2018 was a year of strategic progress and development in Greencore’s UK operations. The group’s business in food to go categories (comprising sandwiches, sushi and salads) generated revenue growth of 10.8% on a pro forma basis and extended its leadership position. Greencore continued to optimise its portfolio in the UK, exiting the cakes and desserts category with the phased closure of the desserts manufacturing facility in Evercreech and the disposal of the business in Hull. As part of the strategy to transition part of its ready meals portfolio to fresher meal propositions, Greencore will phase out longer life ready meals manufacturing at Kiveton (where it continues to manufacture quiche and soup) by March 2019 and transfer volume to other facilities.

Patrick Coveney, chief executive of Greencore.

Greencore extended its long‐term partnership model with key UK customers in 2018, with several important business wins and commercial launches delivered during the year across several categories. The business also extended a number of contracts with its core customers and added new customers in multiple channels.

Greencore implemented a streamlining and efficiency programme across its operations in 2018. This involved the implementation of a more compact and dynamic divisional structure, an accompanying overhead reduction, and an enhanced focus on operational capability and delivery. The overall programme is on track and will help underpin operating margins.

Careful strategic capital investment in infrastructure and capacity was made to support growth opportunities and create a platform for enhanced returns. The extended and refurbished ready meals facility in Warrington was opened in September, and provides Greencore with a centre of excellence for its customer base in fresh ready meals.

Patrick Coveney, chief executive of Greencore Group, comments: “2018 was a year of significant change for Greencore. We delivered good underlying growth in the UK, with favourable consumer and retailer trends helping drive our core food to go business. After the financial year-end, we took the decision to sell our US business having received a compelling offer for it. We will now focus all of our attention and resources on the significant growth opportunities that we see in the UK, both organic and inorganic. Despite the short-term uncertainties of Brexit, our scale, depth and expertise in attractive and structurally growing food categories mean that we are confident in the future growth prospects for Greencore.”