Northern Foods ‘shows resilience’

In a trading statement, the Leeds-based food giant – whose products include branded and retailer own brand ready meals, sandwiches and salads, pizza, biscuits and puddings – reported sales up 2.9%, with revenues in for chilled foods up 8.8%, bakery products up 3.9% offsetting a 7.7% decline in frozen foods. The chilled foods revenue growth was driven by new discount lines in sandwiches and salads, which would dampen divisional margins and profitability would be impacted by the loss of an anchor ready meals contract that would see this close of the division's Hull site at the end of October following a rundown period. Bakery growth had been boosted by another 'Vinnie' TV and online advertising campaign for the Fox's biscuit brand and a new marketing campaign for Matthew Walker plum puddings ahead of the Christmas trading period. Northern put its lower frozen food revenue down to its rationalisation programme including the closure of its original pizza manufacturing site at Poldys in Ireland last year, the relinquishment of several marginal own label contracts and a decision to terminate a Birds Eye co-pack agreement for supplying individual frozen pies, which would now enable the McDougall's brand to compete in this segment. Chief executive Stefan Barden (pictured) said: "Northern Foods has shown its resilience during the first half, in tough market conditions. We continue to invest in our brands and businesses and we have a range of opportunities to drive shareholder value in the coming years. As usual, group sales and profits are weighted to the second half of our financial year. At this stage of the year, we expect to report results in line with market expectations."