Ice cream maker Richmond Foods is expecting a rise in profits for the 53 weeks which end on 2 October 2005.
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In a pre-close statement to the financial markets, Richmond predicted profit before tax for the period of approximately £14.4m (US$25.7m), compared with a comparable figure for 2004 of £13.3m, prior to an exceptional item of £2.3m which related to the closure of the company’s Devon site.
“Richmond has continued to achieve profits growth in tough market conditions,” said chief executive James Lambert. “We are benefiting from the introduction of exciting new products and the substantial investment we have made in our factories. We believe that Richmond can continue to grow profitably.”
Sales are expected to be in the range of £141m to £142m which equates to a decline of around 2%. Over the last 12 months, the ice cream market has declined by 1.5% reflecting an impulse market decline of 5.5% being offset by growth in the take home market of 1.1%. Approximately two-thirds of Richmond’s total sales are in the private label sector of the take home market and increased competition from brands has led to a fall in the private label share of the total ice cream market from 36.5% to 34.8%.
The company anticipates this increased competition in both brand and own label will continue. In response, Richmond has re-launched a number of Nestle products improving the value to the consumer. This, and the success of the Skinny Cow range, has contributed to a 15% increase in the number of Richmond products included in the winter ranges of the company’s retail customers.
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