Greencore Group PLC says new lockdown not as bad as last March but revenues drop
The current coronavirus restrictions are significantly impacting demand in food to go categories
PLC () said the current coronavirus lockdown is significantly impacting demand in food to go categories but it is not as bad as that experienced last March.
Revenue is now 20% below prior-year levels, with performance in food to go categories down approximately 35% on the prior year while other convenience categories remain stable.
READ: Greencore raises £90mln after swinging to full-year loss
The food producer said it is keeping its guidance suspended amid the current uncertainty.
In the 13 weeks to Christmas 2020, Greencore said revenue fell by15% because of the tiered restrictions implemented in the period.
The group’s adjusted operating profit and adjusted underlying earnings (EBITDA) remained positive thanks to cost savings and the government’s furlough support, after the Irish firm swung to a £10mln loss before tax in the year to September 25, 2020.
However, the sandwich maker raised £90mln via a share placing in November so it said it is now comfortable with its cash resources.
During the quarter, the firm also secured new business wins and completed the sale of its molasses businesses for cash consideration of £15.5mln.
“Additional cost control meant that the business was profitable in the first quarter at the operating level, but will have lost money at the profit before tax level,” analysts at Peel Hunt commented.
“We expect to reduce our EBITDA forecast from £105mln to £70mln for the year to September 2021.”
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