UK food group Premier Foods has said warm weather in April negatively impacted sales but that sales for the quarter from January to March were in line with expectations.

In a trading statement issued in advance of its AGM yesterday (10 May), the company also said its growth expectations for 2007 remained unchanged, as 2006 had also been affected by unusually hot weather.

The company also reported that it had "significantly reduced" the decline in sales that the Campbell's portfolio had been experiencing prior to its acquisition, adding that a major re-launch was planned for the Batchelor's and Oxo brands in the second half , supported by "exciting innovations". Premier said it was confident that this would increase the positive momentum it had already established for the brands.

Premier stated that it officially completed the acquisition of RHM on 16 March and had begun integrating the business.

The company expects RHM's sales for 2006/7 to be slightly ahead of 2005/6 but warned that trading profits had been hit by the increase in wheat prices in the autumn of 2006 and softer trading in the culinary brands business as a result of warmer weather in the second half of 2006, though this had been partly offset by the continued strong recovery of the cakes division. 

The bread bakeries division achieved price increases in February, Premier noted. The company said the market had been destabilised by the aggressive price promotion that accompanied the relaunch of Hovis' major competitor Kingsmill but now that this had ended, Hovis' market share had returned to former levels.

Trading at the company's Culinary Brands division had continued in line with its performance in the first half of the RHM 2006/7 financial year, Premier said, while the cakes division continued to progress with strong sales, trading profit and margin growth and improved market share, driven by double-digit sales growth for the Mr Kipling brand.