Greencore shares plummet as sandwich maker flags huge fall in sales

UK-focused Irish company said it expects to report a 14% drop in annual revenues
Greencore shares plummet as sandwich maker flags huge fall in sales

Greencore CEO Patrick Coveney: The group is 'realistic but also confident' in its plans for 2021.

Greencore shares plummeted by close to 10%, before showing a slight recovery, after the convenience food giant said revenues for its recently completed financial year were significantly down on the previous 12 months.

The largely UK-focused Irish sandwiches, salads, and wraps maker — which makes ‘on-the-go’ food products for the likes of Marks and Spencer, Tesco, and Sainsbury’s — said it expects to report a 14% drop in annual revenues when it publishes financial results for the year to the end of September next month.

Reported revenue is likely to be in the region of £1.26bn (€1.4bn).

Greencore took an early Covid hit, given the majority of its focus is on UK office workers buying pre-packed sandwiches and salads for lunch and people buying pre-made savoury food in coffee shops, convenience stores, and motorway service stations. 

Back in May, group CEO Patrick Coveney said it could take “a year or two” before sales volumes across Greencore’s core food-to-go product lines fully recover.

The core food-to-go element of the business saw around a 22% revenue drop in the latest financial year.

However, Greencore said it has begun to see progress, with a slowing in its sales declines. 

Revenue fell around 19% in the fourth quarter compared to a 36% drop in the previous three months.

Full production at its largest UK manufacturing facility in Northampton was restored by the middle of last month, following a shutdown due to a large-scale Covid outbreak, which saw nearly 300 workers test positive for the virus.

Mr Coveney said product demand is improving and that the group is "realistic but also confident in our plans for 2021".

However, Greencore said UK consumer sentiment and broader economic activity remain “both fragile and subdued”.

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