2003 press releases

At the Annual General Meeting held in Willerby near Hull today, the Chairman Peter Blackburn commented:

“First quarter trading was in line with our expectations. Sales in the first 13 weeks were up 5.8 per cent overall and up 7.0 per cent with our five largest customers. This first quarter sales performance benefited from the timing of Easter, and from new business gains, particularly in chilled pizza. Strong sales growth continued in our Convenience foods businesses, and Grocery turnover was also up despite the expected weakness in biscuits.

However this sales growth has been accompanied by margin pressure, which we have only partially recovered through price rises. We have implemented price increases in biscuits to recover higher chocolate costs, but are now seeing costs rising in a number of other product areas, principally those with raw materials linked to the Euro.

On 30 June we acquired the outstanding 60 per cent share of our former associate Solway Foods, increasing our participation in a number of fast growing segments of the chilled convenience foods market, including sandwiches, value-added salads and sushi. We look forward to integrating this business fully into the Group and securing further synergies in areas such as productivity and procurement.

As commented on in the preliminary results announcement, we anticipate that the underlying trend in sales will weaken in the second quarter, reflecting business transfers to competitors. However, we expect headline sales trends to improve as a result of the acquisition of Solway. We continue with our share buyback programme. Since the start of this financial year we have purchased 3.3 million shares for cancellation at a cost of £5.2 million.”