GREENCORE SAYS NORTHERN FOODS BID COST IT €13M - Food group Greencore has reported sales up almost 8% to €442m for the six months to March 25, 2011. Its profits also rose slightly, by €0.5m or 1.7%, to €27m. It saw a good performance in its convenience foods division despite challenging market conditions, and the performance of its ingredients and property division was hit by reduced property trading activity.
Greencore's chief executive Patrick Coveney says that overall the company enjoyed a good performance in its first half, but says there are lots of different components that makes up that performance. He says the company was affected by consumer confidence, which bounced around a bit during the six months. He says that the company saw very poor demand in December due to the bad weather, while people simply bought nothing in January. But, reassuringly, he said that trading in the six month was 'solid'.
On the failed Northern Foods deal, Mr Coveney says that it cost the company €13m in cash terms due to the putting of finance in place and on several advisory fees.
The Greencore CEO says that rising commodity prices have not really impacted the company so far as they have done 'a nice job of maintaining margins'. But he says that gravity can not be defied forever. He warned that if there is another big spike in food prices after the summer harvests, Greencore's prices will be affected.
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IRELAND STARTING TO HEAL FROM 'HORRIBLE EVENTS' - STATE STREET ECONOMIST - Christopher Probyn, who is State Street's global chief economist, is in Dublin today for Boston. Mr Probyn says that Ireland is beginning to heal from the horrible events of the last couple of years which saw an economic crash and massive destruction of household wealth. He says that growth this year should be stable, and may even move in positive terrain while the threat of deflation is also easing.
On the EU/IMF bail-out programme for Ireland, he said the two organisations are going through the standard operating procedures but are leaving it to Ireland to solve its solvency problem. The economist says he is not sure that will work, and if it does, it will take a long time. He says the EU and IMF need to come up with something more creative - like debt relief - in order to prevent a vicious cycle. 'It seems to me that an almighty crisis must happen before the euro zone moves to do something,' he said.
On the recent visIts by the Queen of England and US President Barack Obama, Mr Probyn says that they did provide Ireland with a temporary bounce, but warned there is lots of hard work ahead.
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MORNING BRIEFS - Tullow Oil has spent €300m on Dutch firm Nuon Exploration and Production, adding to its North Sea business.
*** On the the currency markets the euro is trading at $1.4065 cents and 87.26 pence sterling.
