Resilient FY20 Performance by Greencore

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Resilient FY20 Performance by Greencore

Resilient FY20 Performance by Greencore
November 25
09:20 2020
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Greencore Group, a leading manufacturer of convenience food in the UK, has reported a 12.5% fall in revenue to £1.265 billion for the year ended 25 September 2020 with adjusted operating profit down by 69.2% to £32.5 million and adjusted operating margin lower by 470bps at 2.6%, as the effect of COVID-19 impacted on the company’s food to go categories in the second half of the financial year.

Full year revenue in the group’s food to go categories (comprising sandwiches, salads, sushi and chilled snacking) totalled £772.9 million and accounted for approximately 61% of reported revenue. Reported revenues declined by 19.7% in these categories, driven by the impact of COVID-19 and partly offset by the acquisition of Freshtime in September 2019. Adjusting for this acquisition, pro forma revenue declined by 22.6%.

Revenue for the distribution of third party products accounted for approximately 6% of group revenue in the 2020 financial year and benefited from new customer wins in the period. Greencore’s other convenience categories comprise activities in the chilled ready meals, chilled soups and sauces, chilled quiche, ambient sauces and pickles, and frozen Yorkshire Pudding categories, as well as Irish ingredients trading businesses. Reported revenue across these businesses increased by 1.7% to £491.8 million during the period.

Patrick Coveney.

Patrick Coveney, Chief Executive Officer of Greencore, comments: “This has been an exceptionally challenging year for Greencore, and I am enormously proud of the resilience and adaptability that our colleagues have shown in helping to navigate the business through the toughest trading conditions it has ever seen. Having been designated as ‘key workers’, Greencore colleagues have played an instrumental role in helping to feed the UK, and their health and wellbeing remains our number one priority.

“There is a direct correlation between the performance of food to go and the nation’s ability to move around freely. As a result, that part of our business has been significantly impacted by the social restrictions that have been put in place as a result of COVID-19. However, we remain confident that demand for our food to go categories will recover strongly as the effect of COVID-19 recedes, and were encouraged by the uplift in demand that we saw in Q4 as the UK economy slowly reopened.”

He continues: “Despite the ongoing uncertainty, we have still been able to secure new business and extend our product range during FY20, and our other convenience categories have delivered a solid performance. Furthermore, our relationships with our customers are stronger than ever before, having worked in close collaboration with them throughout the pandemic, and they remain firmly committed to the categories in which we operate. As such, notwithstanding the near-term challenges, we are optimistic about the medium-term prospects for Greencore.”

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