Premier Foods hit by September heat wave as gravy sales slump
Shares in Premier Foods plunged more than 12% after the manufacturer behind the Oxo and Bisto brands warned Britain’s Indian summer had dented sales of gravy and puddings.
The firm, which this year rejected a £1.5 billion takeover bid from Schwartz spices giant McCormick, saw turnover in the 13 weeks to October 1 drop 5.4% to £172.5 million.
It blamed warm weather in September for sales of gravy and stocks plummeting 13%, despite TV ads featuring Countdown’s Rachel Riley. Desserts sales fell 9%.
Chief executive Gavin Darby said: “We are disappointed that our grocery business reported materially lower sales in the quarter.”
The company said its profit expectations for the year were unchanged but that sales would now rise by only 1 to 2%, versus a prior forecast for a 2 to 4% increase which remains its medium term target.
Shares decreased 6.65p to 45.6p.
The update will put further pressure on Darby to deliver more growth for investors after talks failed with McCormick for a 65p a share proposal in April.
