Mr Kipling owner to sell cakes in the US
Premier Foods is planning to ship its ‘exceedingly good’ Mr Kipling cakes across the Atlantic.
The FTSE 250 firm, which also owns Bisto gravy powder and Ambrosia custard, plans to expand the brand into North America and is aiming to roll out Mr Kipling cakes in Canada over the next six months following a successful trial in the country.
Premier Foods then plans to take Mr Kipling to the US.
However, the group’s shares sank 4.4pc, or 5p, to 109.2p as figures for the half-year to October 2 left a sour taste in investors’ mouths. Profits in the period slumped 39pc to £30.7m. Revenues dropped 6.5pc to £394.1m.
The sharp drop in profits came as the end of lockdown meant shoppers no longer needed to pack their cupboards with Premier’s products for long stretches stuck at home.
Despite this, chief executive Alex Whitehouse flagged ‘strong momentum’ going forward and that the company was ‘firmly on track’ to deliver its profit expectations for its full year. The firm was also managing to navigate ongoing supply chain issues and inflation. Analysts at Peel Hunt shrugged off the drop in profits, saying the decline was unsurprising given the boom in grocery shopping over the pandemic.
The broker instead focused on what they said were ‘a busy six months ahead’ for the firm, noting a number of new product launches. As a result, analysts said Premier’s shares were ‘excellent value given the strong underlying revenue and [profit] margin performance’.
The FTSe 100 dropped 0.3pc, or 24.89 points, to 7326.97 while the FTSe 250 was down 0.4pc, or 81.87 points, at 23539.71.
Upward movement in the bluechip index was constrained by a stronger pound, which rose in value after better than expected UK unemployment data increased expectations of an interest rate hike in December.
Homeserve, the FTSE 250 emergency home repair specialist, saw its profits nearly double as its gambit in the American market began to pay off. The shares jumped 7.1pc, or 61p, to 917.5p as the firm posted a profit of £18.9m in the six months to the end of September, up from £10.1m in the same period last year.
Chief executive Richard Harpin said that the firm’s North America business had delivered ‘an outstanding performance’ that was ahead of its original plans.
The company also stood to benefit from the recent surge in UK energy prices, which has caused several smaller suppliers to go bust and seen customers transferred to bigger players such as E.On and Shell Energy, both of which are Homeserve partners.
imperial Brands, the owner of Lambert & Butler cigarettes, delivered a 15pc rise in profit yearon-year to £3.1bn for the year to the end of September, helped by higher tobacco prices.
However, the shares dropped 1.8pc, or 29p, to 1569p as the firm flagged a decline in its market share as losses in Germany and Australia offset gains in the US, the UK and Spain.
Investors in revolution Bars had little to cheer about as the chain counted the cost of the pandemic. For the year to July 3, the company saw a loss of £26.3m, although this was narrowed from a £31.7m loss in the previous year. Revenues, meanwhile, plunged to £39.4m from £110.1m. Revolution also said Christmas bookings were coming in ‘more slowly’ than normal, which was attributed to ‘a level of uncertainty’ about possible Covid-19 restrictions over the festive period. The shares dropped 7.5pc, or 2p, to 24.7p.
Ticket app Trainline tracked up 0.9pc, or 2.6p, to 301p as analysts at Liberum said it had little to fear from the Government’s planned Great British Railways (GBR) booking app. The broker initiated coverage of the stock with a ‘buy’ rating and 400p target price.