May 16, 2017
Premier Foods focuses on costs as revenues and profits fall
Premier Foods, the producer of Mr Kipling cakes, reported a fall in full-year underlying revenues and profits and said it would change its strategy to focus as much on cost efficiencies and cash generation as sales growth. Revenues of £790.4m in the year to April 1 were 2.4 per cent higher than the previous year but 1.4 per cent lower on an underlying basis, excluding an acquisition. Pre-tax profits of £12m compared with a loss of £13m the previous year when the group took a hit from writing down the value of its 49 per cent stake in Hovis bread to nil. It's all still tight, tight, tight, but the application of managerial cool heads, in the wake of the nadirs of the second and third quarters, might yet see Premier Foods prevail. Premier, which has a market value of £351m, said it was targeting net debt to ebitda of three times in the next three to four years by keeping a tight control on costs.
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