Blog: Investors pummel Premier
Dean Best | 27 April 2010
At first glance, the market could be said to have a short memory. Premier Foods plc's shares were hammered today (27 April) after the UK's largest food maker booked a 5% drop in quarterly sales.
At the time of writing, Premier's stock was down more than 9%, although at one point today, the shares had tumbled by more than 11%.
With this winter's severely cold weather denting Premier's sales between January and March, one could be forgiven for thinking the market was being a tad unsympathetic.
Investors, however, may be growing just a little impatient at the apparent lack of progress Premier is making in offloading assets to pay down debts.
The market could be a bit jittery that any sign of a slowdown in Premier's top line could be a threat to the company's business model. And, with sales down 5% in the first quarter of 2010, and with no sign of disposals, investors seem to have indicated their nervousness.
To be fair to Premier, this anxiety could be a bit premature. The company said it had managed to reduce debt in the quarter and finance director Jim Smart insisted management wanted to ensure any disposals generated decent proceeds and left the business stronger, not weaker.
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