Greencore has upgraded its full-year outlook as it expects greater growth due to “continued improvement in profit conversion” despite a fall in sales.
Reported revenue dropped by 6.1% to £465.2m in the 13 weeks ending 28 June, with the company citing disruption due to the sale of its Trilby Trading business and the exit of a series of “low margin contacts” last year. On a like-to-like basis, Greencore sales edged up 1.4% in what chief executive Dalton Philips called an “excellent performance” in a “tough comparative period”.
The UK’s largest sandwich maker said it now expects its full-year adjusted operating profit to be in a range of £88 to £90m, ahead of prior guidance of £86 to £88m.
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Philips added: “Our continued progress has been delivered through ongoing impactful operational and commercial initiatives, which we are continuing to implement at pace, supporting the improved profit conversion in the quarter,”
This comes despite Greencore facing a difficult few months earlier this year after it was one of a handful of suppliers involved with the E.coli supermarket sandwich crisis.
Many of the UK’s leading retailers, including Asda, Morrisons, Sainsbury’s and the Co-op, were forced to recall their sandwiches, wraps and salads after the FSA suspected an outbreak of E.coli through contaminated lettuce leaves.
Greencore and fellow supplier Samworth Brothers have since confirmed all their sandwiches are back on the shelves following the outbreak, however earlier this month it emerged that supermarket giants Tesco and Asda are being sued by customers following the crisis, which left more than 120 in hospital and the confirmed death of one person.
