Food group Greencore has reported a 9% increase in pre-tax profits, before exceptional items, to €31.1m for the six months to March 28.
The group said it is well positioned to continue to generate good growth in profitability from continuing operations combined with strong cash generation and further reductions in interest payable.
Operating profit from continuing activities grew by €3.4m or 7.4% to €48.9m in the six month period. Like for like sales growth was reported across the company's three divisions while the company's headline earnings per share was up 2% to 14.1 cent.
Like for like sales at the group's chilled and frozen division grew by 3%, resulting in a 12% increase in continuing operating profit from €16.3m to €18.2m. Greencore's sandwich business enhanced its positioned as the world's largest manufacturer, while its ready meals continued to trade strongly.
Greencore said its chilled pizza business had a challenging first half. It said that although much was achieved, with the integration of volumes from the Bedford facility closed just before the start of the period and the closure and transfer of volumes from the group's other remaining facility in March, the necessary efficiency levels have not yet been achieved. It said it expected a considerable improvement in performance during the last quarter of the financial year.
Operating profit at Greencore's ambient grocery division grew by 6% from €10.4m to €11.1m. The ambient sauces and pickles business performed well, while its Scottish mineral water business benefited from further growth in demand for mineral water in the UK.
The company's cake and dessert business reported a much improved Christmas and has won additional trade which will deliver an improved performance for the full year.
Greencore's ingredients and agribusiness division reported like for like sales of 3% while operating profit grew by 4% from €18.8m to €19.6m. Irish Sugar had a satisfactory first half, while the profits of the group's malt business increased.
Net debt at the company was reduced by €66.1m to €497.1m, benefiting from a particular focus on cash generation across the group. Greencore said this result was particularly satisfactory in light of the normal seasonal increase in working capital at Irish Sugar.
'These are very strong results both in terms of profitability and cashflow, and are a product of the extensive restructuring which the group has successfully undertaken over the last two years,' Greencore's CEO David Dilger said.
'The group remains on course on deliver full yar earnings per share in line with consensus analyst forecasts,' he added.
Greencore shares closed up 10 cent at €2.90 in Dublin.
