2005 press releases

Financial Highlights

• Continuing sales £700.0m (2004: £680.7m); underlying sales* growth 3.4%
• Satisfactory profit performance in difficult trading environment – profit from continuing operations** up 7.0% at £38.4m (2004: £35.9m); profit before tax** up 5.8% at £25.7m (2004: £24.3m)
• Profit for the period £14.4m (2004: loss £7.9m)
• Interim dividend increased to 3.40 pence per share (2004: 3.35 pence per share)

Operational Highlights

• Market share gains in key brands – Goodfella’s, Fox’s, Pork Farms
• Significant new business wins with major retailers
• £10.7m benefit delivered from efficiency programmes, net of upfront programme investment, largely offsetting inflationary cost pressures
• Restructuring of chilled businesses initiated

Chief Executive Pat O’Driscoll said:

“Our programme for the transformation of Northern Foods is well underway. We have made encouraging progress in the last 12 months.

The trading environment remains difficult. Against a background of rising input costs, particularly for energy, we expect the recent period of price deflation to end. We are negotiating with our retail customers to recover input cost inflation. With our GET FIT programme continuing to drive efficiencies, we expect progressively to improve our operating margin over the next 18 months.”

^{* Underlying sales excludes currency gains of £1.4m, product categories no longer manufactured of £0.5m (2004: £5.4m) and discontinued operations.}

^{** Before exceptional items. Items which are both material and non-recurring are presented as exceptional items within their relevant consolidated income statement category. The separate reporting of exceptional items helps provide a better indication of the group’s underlying business performance. Events which may give rise to the classification of items as exceptional include the restructuring of businesses, gains or losses on the disposal of businesses and asset impairments.}