Premier Foods Plc, owner of the Hovis bread and Bisto gravy brands, is seeking to benefit from sales of its British branded food following the success of Team GB at the London Olympics.
“I think it is helping,” Chief Executive Officer Michael Clarke said. “The important thing within our portfolio is that all of our brands are British,” adding that as much as 82 percent of its input costs are sourced from within the U.K.
Sales of Mr Kipling cakes were helped by the Queen’s Jubilee celebrations, the company said today in a regulatory statement. Premier Foods earlier reported an underlying profit of 53.2 million pounds ($83 million) in the six months to June 30, up 3.2 percent from the year earlier period. The results reflect a divesting program to refocus on eight “power brands” which include Mr. Kipling cakes, OXO stock cubes, and Loyd Grossman sauces, the company said.
Premier Foods rose as much as 9.7 percent to 79.5 pence in London, the biggest gain in over two months. Shares have fallen as much as 60 percent since hitting a peak of 185 pence on March 28.
Sales in the bread division fell 3.6 percent to 348.3 million pounds. Milling sales dropped 8.3 percent, reflecting lower wheat prices, a trend which was reversed owing to the U.S. drought and excessive rainfall in the U.K., Clarke said.
“It’s inevitable that this is going to lead to higher wheat commodity prices,” he said. “We will feed those through to pricing.”