Greencore Group issues pleasing pre-Christmas Trading Update

30.01.2025

This morning’s Q1 Trading Update from leading convenience foods maker, the Greencore Group (LON:GNC), reported that the 13 weeks up to 27th December 2024 showed a 7.5% increase in reported revenues.

With strong market positions in a range of categories including sandwiches, salads, sushi, chilled snacking, chilled ready meals, chilled soups and sauces, chilled quiche, ambient sauces, pickles and frozen Yorkshire Puddings, the group supplies all of the major supermarkets in the UK, as well as convenience and travel retail outlets, discounters, coffee shops, foodservice and other retailers.

Management Comment

CEO Dalton Philips stated that:

"The Group has made a positive start to FY25, and I am encouraged by the platform this provides us for the rest of the financial year.

Our volume growth of 2.6% in the quarter again outperforms the market and is driven by both underlying volume growth and winning new business.

This reflects a combination of the quality of our products, our commitment to innovation and the strength of our relationships with our customers.

We continue to make progress against each of our strategic objectives and are well-positioned to continue this momentum through FY25.

We continue to remain focused on making high-quality food, enhancing our profitability, and strengthening our position as the UK's leading convenience foods manufacturer.

We have delivered a strong Q1 and are confident that we will deliver a full-year performance in line with current market expectations.”

Analyst Views

Analysts Darren Shirley and Clive Black, at Shore Capital Markets, consider that the group had made a strong and encouraging start to its 2025 Trading Year to end-September.

Their current year estimates are for sales of £1,897m (£1,807m) with adjusted pre-tax profits of £84.5m (£74.7m), lifting earnings to 13.9p (12.7p) and its dividend per share to 3.5p (2.0p).

For the 2026 year the analysts look for £1,943m revenues, £91.0m profits, 15.0p of earnings and an increased dividend of 4.3p per share.

In My View

Less than two months ago, in early December, the group’s shares traded up to a 228.17p High, they are now at around 183p, valuing it at £809m.

I now see them rising again, probably ahead of next Wednesday’s Capital Market Day for analysts and institutional investors, which is when the group will outline its medium-term growth strategy.

We have done well to date highlighting this group’s investment attractions and remain

totally convinced that greater growth is to come, which will be reflected in an improving share price.