Convenience-food maker Greencore has raised its profit guidance again, citing volume growth the company said was ahead of the sector.
In a trading update issued today (13 October), the UK-listed private-label group forecast annual adjusted operating profit from continuing operations of £248m ($328.3m) for the year to 25 September.
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The guidance is above the £238m consensus among analysts and the earlier forecast range of £234m to £242m.
CEO Dalton Philips said: “Greencore has had a monumental year and we finished it with a strong performance in Q4. We grew volume ahead of the market, drove strong profit growth and we continue to make strides in our integration with Bakkavor. That performance means we are in a position to further upgrade our full-year guidance.”
Greencore completed its deal for fellow UK private-label supplier Bakkavor in January.
During the fourth quarter, pro-forma revenue increased 4.5% to £1.04bn. The company attributed the growth to “strong” volume gains alongside pricing actions that recouped higher labour, packaging and raw material costs. Full-year pro-forma revenue rose 3.6% to reach £3.38bn.
Quarterly manufacturing volume climbed 2.1% on a pro-forma basis, outpacing the 0.5% uptick across the broader grocery sector, Greencore said.
Chilled offerings including salads, dips, quiche, and sandwiches traded “strongly”, as per the update.
Over the entire 12 months, Greencore’s volumes rose 1.1% against the 0.5% recorded across the broader grocery landscape.
According to Greencore, both its legacy business and the newly integrated Bakkavor operations outpaced the market average.
“Synergy delivery from the Bakkavor acquisition has continued to progress strongly,” the company said.
The group projects year-end net debt, excluding leases, at around £600m, which is roughly 1.8 times its adjusted EBITDA and above its medium-term target range of 1 to 1.5 times.
Greencore said first-quarter trading in fiscal 2027 began “positively”, maintaining volume trends. The group also expressed confidence in “the resilience of demand in its core categories” despite an “uncertain” macroeconomic climate.
Meanwhile, the planned divestment of the US division is proceeding, with the unit continuing to trade “positively and in line with expectations”, added the company.
Complete annual results will be released on 1 December.
