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May 9, 2006

UK: Richmond H1 pretax profits rise 62.2% but sales poor

Richmond Foods has reported pretax profits of GBP2.9m (US$5.39m), an increase of GBP1.1m from the comparable period of last year, despite intense competition in an unusually weak market that resulted in a sales decline, the company said.

Richmond Foods has reported pretax profits of GBP2.9m (US$5.39m), an increase of GBP1.1m from the comparable period of last year, despite intense competition in an unusually weak market that resulted in a sales decline, the company said.

Take-home sales dropped by 5.1% compared with the first six months of last year. “This has intensified competitive pressures, especially in the own label tub sector of the market, an important part of Richmond’s business,” said Richmond chairman Ross Warburton. “However, further progress has been made in growing the branded sector of our business, particularly in individual ice creams, which is the largest sector of the market.”

The ice cream maker’s share of the market declined from 31.2% in the first half of 2005 to 29.4% this half. However, Richmond, who last week agreed a GBP182m takeover by Oaktree Capital Management, did note that its share of the branded take-home market increased marginally to 11.7%, driven by the success of Nestlé products and the expansion of the Skinny Cow range which helped to offset the company’s loss of its Weightwatchers contract.

Richmond has raised its interim dividend from GBP0.01 to GBP0.03.

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