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| Premier Foods in profit warning | Premier Foods in profit warning |
| (about 1 month later) | |
| Premier Foods, the owner of brands such as Hovis, Bisto and Mr Kipling, has warned its full-year trading profit will fall below expectations. | Premier Foods, the owner of brands such as Hovis, Bisto and Mr Kipling, has warned its full-year trading profit will fall below expectations. |
| The UK's biggest food manufacturer had been looking at a profit of between £214m and £232m. | The UK's biggest food manufacturer had been looking at a profit of between £214m and £232m. |
| But the company said current trading was "disappointing" and "significantly behind our expectations". | But the company said current trading was "disappointing" and "significantly behind our expectations". |
| Sales in the third quarter fell 3.6% on a year ago, while the group's market share declined by 1.9%. | Sales in the third quarter fell 3.6% on a year ago, while the group's market share declined by 1.9%. |
| The group said it was in "constructive dialogue" with banks on refinancing. | The group said it was in "constructive dialogue" with banks on refinancing. |
| Shares in Premier Foods closed down more than 4 pence, or 42%, at 5.8p. | Shares in Premier Foods closed down more than 4 pence, or 42%, at 5.8p. |
| New chief executive Michael Clarke has outlined five key priorities for the business in the short term. | New chief executive Michael Clarke has outlined five key priorities for the business in the short term. |
| These are agreeing a refinancing plan, improving sales and marketing, reducing the size of Premier's portfolio, reducing costs, and investing in eight "power brands" that they feel have the best growth prospects. | These are agreeing a refinancing plan, improving sales and marketing, reducing the size of Premier's portfolio, reducing costs, and investing in eight "power brands" that they feel have the best growth prospects. |
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| The eight brands are Ambrosia, Batchelor's, Bisto, Hovis, Lloyd Grossman, Mr Kipling, Oxo and Sharwood's. | The eight brands are Ambrosia, Batchelor's, Bisto, Hovis, Lloyd Grossman, Mr Kipling, Oxo and Sharwood's. |
| Mr Clarke, who had previously been president of Kraft Foods Europe, took the helm at Premier Foods on 1 September. | Mr Clarke, who had previously been president of Kraft Foods Europe, took the helm at Premier Foods on 1 September. |
| 'Mettle tested' | 'Mettle tested' |
| Martin Deboo, analyst at brokers Investec Securities, said the company now faced a question of survival. | Martin Deboo, analyst at brokers Investec Securities, said the company now faced a question of survival. |
| "To say that all this adds up to a baptism of fire for new chief executive Mike Clarke feels like the understatement of the year. His mettle is going to be strongly tested in the run-up to Christmas," he said. | "To say that all this adds up to a baptism of fire for new chief executive Mike Clarke feels like the understatement of the year. His mettle is going to be strongly tested in the run-up to Christmas," he said. |
| Premier saw declining sales across the board. Grocery sales were down 5% in the quarter, bakery sales fell 7.6%, and sales at its Brookes Avana business, which makes own-label ranges for supermarkets, dropped 13.2%. | Premier saw declining sales across the board. Grocery sales were down 5% in the quarter, bakery sales fell 7.6%, and sales at its Brookes Avana business, which makes own-label ranges for supermarkets, dropped 13.2%. |
| Many retailers have been reporting tough trading conditions as consumers rein in their spending | Many retailers have been reporting tough trading conditions as consumers rein in their spending |
| Earlier this week, supermarket giant Tesco said its like-for-like UK sales, excluding VAT and petrol, had fallen by 0.5% in the first half of the year. | Earlier this week, supermarket giant Tesco said its like-for-like UK sales, excluding VAT and petrol, had fallen by 0.5% in the first half of the year. |