LONDON -- Premier Foods (PFD 0.13%), the food manufacturing and distribution company that produces brands such as Sharwood's, Ambrosia, and Bisto, showed some healthy preliminary results for the year ended 31 December 2012. Underlying sales (excluding Milling) were up 3.2% to 1.3 billion pounds, with "Power Brand" sales rising 2.1% to 889 million pounds. This increase in sales fed through to the bottom line with an increase in underlying business trading profits of 10.6% to 123 million pounds and operating profits of 96 million pounds compared to a loss in 2011 of 176 million pounds.
In addition to the trading figures, Premier Foods disposed of brands worth 312 million pounds from the sale of the Irish brands, Vinegar & Sour Pickles, Elephant Atta Ethnic Flour, and Sweet Spreads & Jellies businesses. Net debt was also reduced to 951 million pounds from 995 million pounds in 2011. The markets have reacted well to the news with a 4% jump in the share price to 93 pence.
Gavin Darby, chief executive officer of Premier Foods, commented on the results:
Premier Foods has many strengths and great potential. The management team did a great job in 2012 to lay the foundations for future growth and I am very excited to be working with them to develop and grow our Power Brands in the coming years. It's important now to maintain continuity and focus on executing our existing strategies to build further momentum in Grocery while rebuilding value in Bread.
The results show good progress for a company that have been struggling in recent years, and Premier Foods will be hoping that the increased marketing in 2012 does reap the desired rewards in 2013.
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