Hovis-maker Premier recovers cost inflation

Hovis maker Premier Foods today said revenues from bread sales were up 16% after it increased prices to cope with soaring wheat costs.

The food giant, which also makes Mr Kipling cakes and Branston Pickle, said price hikes across its bread and flour ranges during the half year to June 28 reflected “continued pressure from wheat and other input costs.” A soft white medium loaf cost £1.24 (€1.55) on the Tesco website this morning.

Chief executive Robert Schofield also warned of potential further price hikes across the business: “We have good forward sight of inflationary pressures and have plans in place to mitigate them as they occur.”

The St Albans-based group said sales of its big-selling Hovis brand, which suffered a series of quality and pricing problems last year, had now stabilised. But sales volumes of the product are still lower than a year ago, it said.

Premier’s overall sales were 7% ahead for the first half, again driven by price rises, with trading profit for the period in line with last year.