Positive Premier Food results fail to prop up sentiment

FTSE 250 Premier Foods (LON:PFD) has seen its share price sink by 9.13% to 93.60p (as of 15:25 GMT) after reporting results for the 26 weeks to 26th September. Revenues for the half year were up by 15% and statutory pre-tax profits improved by 35.5%, but markets appeared disappointed as the shares lost the gains made this week.

CEO Alex Whitehouse commented: “Looking to the second half of the financial year, we expect to see continued revenue growth driven by further new product innovation, strong commercial plans and increased marketing investment for our brands, with six major brands planned to be advertised on TV. We also now expect to see an increase in demand for our brands due to the impact of recently increased government restrictions on eating out. The longevity of this increased demand is likely to be linked to the duration of these new measures, and although we have tougher comparatives in the fourth quarter, we anticipate that Trading profit for the full year will be ahead of current market expectations. Additionally, following both our recent progress in accelerating leverage reduction along with proceeds received from the Hovis transaction, we are today announcing a new medium-term target for Net debt/EBITDA of approximately 1.5x.”