Sales at the UK’s largest food producer Premier Foods have fallen sharply as the discount market begins to tighten its grip on Britain’s biggest brands.
Total sales were down 6.1 per cent while power brands such as Sharwoods, Ambrosia Custard and Batchelors lost share and fell 4.9 per cent over the 26 weeks, accelerating to 6.3 per cent in the second quarter.
Management blamed the weather, promotions and ‘hard discounters’ that do not stock their products for the poor sales. Full-year profit is now expected to fall 5 per cent to £91.5m.
“We are adapting quickly to the changing external environment through retaining a tight control of costs and margins and have a strong programme of consumer marketing and new product introductions planned for the second half of the year,” insisted Gavin Darby, chief executive officer of Premier Foods.
Premier Foods employs around 4,000 people operating from 17 sites across the country.
“The pressure is building through H2 for the group to halt the sales slide evident though H1, and return the Power Brands to growth, underpinned by the much vaunted new product pipeline and boost to marketing support,” commented Clive Black at Shore Capital