Nomad Foods CEO Stéfan Descheemaeker has said the frozen food group's half-year results "were in line with expectations" despite lower sales.
The owner of the Birds Eye brand in Europe booked a 2.4% decline in net revenue to EUR743.1m on a pro-forma, as adjusted basis. Excluding the impact from currency exchange, one less trading day and Iglo Group's exit from Romania, Slovakia and Turkey, like-for-like net revenue fell 4.9%.
Pro forma, as adjusted EBITDA was EUR142.9m, down 1.1% down year-on-year but the EBITDA margin increased 0.2% due to lower advertising and promotion spend, compared to spending on what Nomad called "strategic launch activity" a year earlier. It also pointed to foreign exchange benefit on the translation of sterling profits.
Net profit reached EUR76.7m, versus EUR77.3m a year earlier. Earnings per share stood at EUR0.49, versus EUR0.50 in the first half of 2014.
"Overall, results were in line with our expectations at the time of the acquisition, taking into account the difficult retail environment in Iglo Group's core geographies," Descheemaeker said. "In response to market conditions, we have selectively increased promotion levels to remain relevant to value-seeking consumers whilst maintaining profitability and cash generation through rigorous control of the cost base."
The pro-forma results were adjusted to include Nomad's results for the six months ended 30 June 2015, which already include June results for Iglo Group and numbers from 1 April 2014 until 30 June 2014. Nomad Foods was incorporated on 1 April 2014.
On a reported basis, Nomad ran up a loss of EUR536.1m, primarily resulting from a non-cash, founder shares valuation charge of EUR493m, purchase accounting adjustments of EUR26m and costs of EUR22m associated with the acquisition of Iglo Group in June.
Noam Gottesman, Nomad's co-chairman and founder, added the Iglo acquisition was "performing as expected".
He said: "We are excited about other potential acquisitions opportunities that meet our criteria of being market leaders in niche markets and having a long history of strong free cash flow generation."
The company earlier this month announced followed up its move for Iglo Group with a deal to buy Findus Group's European assets.
"The momentum we have achieved thus far in 2015 have us well positioned to achieve meaningful long-term growth both organically as well as through prudent and complementary M&A opportunities," Gottesman added.
Nomad has said it is looking at acquisition targets in the US. Where could the business look? Click here for our analysis.