Media

15 February 2011

Preliminary results for the year ended 31 December 2010

Trading profit of £311m up 0.6% on last year

Today Premier Foods has announced Preliminary results for the year ended 31 December 2010.

Highlights

• Sales down 3.5% due to lower non branded sales
 - Branded sales volume up 3.1%, ahead of the market

• Trading profit of £311m up 0.6% on last year
 - Grocery and Hovis both recorded improved trading profit
 - £12m pension credit reduces year on year pension cost by £3m
 - £15m fall in trading profit at Brookes Avana

• Pro forma adjusted profit before tax and EPS advanced by 6.4% benefiting from lower interest charges

• Net debt down £103m to £1,261m.  After proceeds of Canning and Meat-free disposals, pro forma net debt will be below £900m

• £125m goodwill impairment at Brookes Avana resulting in pre-tax operating loss of £98m (2009: £42m profit restated6) on a continuing basis.  Basic EPS was a loss of 3.6p (2009: earnings of 1.7p)

• Recurring cash generation of £124m, ahead of £100m target

Commenting on the results Chief Executive Officer, Robert Schofield said

“2010 has been an important year in the history of Premier Foods. During the year we set out a financial strategy which we have progressively implemented by closing out our interest rate swap exposure, closing our final salary pension scheme, generating £124m in a recurring cash flow and obtaining a credit rating to allow us to access bond markets.  Since the end of the year we have also agreed the sale of two businesses which will reduce our debt level to less than £900m, compared to £1,365m a year ago.

“Our business has proved resilient, with branded volume market share growth, increased margin from procurement and manufacturing efficiency and lower operating expenses.  There is more to do in each of these areas and we have aligned the organisational structure behind the strategy of growing our brands.  We would expect our focus to enable the Group to show progress from our new base after the disposals without a further deterioration in the consumer environment”.

The full release can be viewed below.

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28 October 2010

Interim Management Statement for the three months ended 30 September 2010

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