Premier Foods is looking to enter that hallowed space enjoyed by a number of recently revitalised British heritage brands, revealing plans to update its portfolio.
The company’s marketing director Jon Goldstone told journalists at a strategy update on Friday afternoon (24 June) that many of the brands it has acquired over the last decade had been “neglected” by their previous, multinational owners. He said that they had become a bit “dusty” and that there was the perception that they had become “yesterday’s brands”.
However, he said that the company sees an opportunity to revamp its brands, which include Hovis, Mr Kipling and Oxo, much in the same way as other British heritage brands – such as Mini, Burberry, Mulberry and Selfridges – have done.
The company, which Goldstone said “has only really been around for 10 years”, has faced heavy investor criticism in recent years over its high debt levels.
Goldstone said that the company’s strategy in the past has been to approach multinational manufacturers who were pursuing global strategies and offering to buy up their local brands, a process that has led to the acquisition of brands including Branston, Oxo and Angel Delight.
While the moves generated scale, it led the company to build worrying levels of debt, which at one point, Goldstone said, “maxed out at GBP1.8bn” – some six times earnings.
With the company having completed the sale of its meat free brand Quorn, and currently in the process of selling its canned meat business, Goldstone said the company’s debt levels are now getting close to its target of 3.2 times earnings.
With debt at less worrying levels, Premier Foods is now in the position to invest in “transforming iconic British brands”.
The company’s task is to update its offer to make it relevant again to consumers. The breadth of options being considered is impressive. Goldstone suggested it would look at strategies from leveraging its Brooks Avana ready meals business to creating chilled Loyd Grossman Italian meals. Also being looked at are family ready meals under the Bisto brand and the potential of opening up quick-service stir fry restaurants under the Sharwoods brand in high traffic areas such as train stations.
Moving from a brand that is looking to grow its branded product offer, to another looking to grow its private-label offer, Ocado announced today that it has entered a partnership with Carrefour to sell the French grocer’s ‘Reflets de France’ range of products. The deal is likely to go some way to allaying investor concerns over its reliance on Waitrose, which currently supplies Ocado’s private label range, and is about to move into Ocado’s key trading space, the M25 area.
And, finally, the E. coli crisis just doesn’t seem to be letting up, with French officials saying over the weekend that some 10 people have become ill and that a UK farm is suspected to have been the source.