Branston Pickle owner Premier Foods hailed the success of its Campbell’s acquisition today after revealing a 12.2% rise in annual profits.
The group said the business fitted Premier “like a glove” after spending £460m (€676m) on adding well-known brands such as Oxo, Batchelors and Homepride.
Premier, which will complete the acquisition of Mr Kipling firm RHM later this month, said annual profits rose to £58.1m (€85m) from £51.8m (€76m) a year ago.
The deal for Bisto firm RHM, which will cost £1.2bn (€1.8bn), transforms Premier into the UK's largest food supplier - ahead of Mars, Nestle and Northern Foods.
With annual sales in excess of £2.6bn (€3.8bn), the proposed company should be in a stronger position with the UK’s increasingly powerful supermarket chains.
Premier said the acquisition had failed to distract it from growing the business, as it overcame the impact of “significant” raw material and energy price inflation and extended warm weather through the summer and autumn.
Turnover was up 21.5% to £959.4m (€1.4bn) in 2006, with core brands such as Loyd Grossman growing by 25%, Branston by 16% and meat-free range Quorn by 13% on a like-for-like basis. Jam range Hartley’s was ahead by 10%, with Ambrosia up 8%.
Premier said the Campbell’s business had performed in line with expectations at the time of the deal, with trading profits ahead 11% across the year. It saw declining sales over 2005 and 2006, but Premier said this was because of a significant cut in promotional and marketing spend prior to its sale.
It has developed detailed “marketing and innovation plans” for the business, which it has started to implement with strong reported results so far.
As a result of the acquisition, Premier said in January its would close sites at Kings Lynn and Ashford, in order to consolidate production into its Worksop, Long Sutton and Wisbech factories.