Investing.com -- Premier Foods (LON:PFD) reported strong third-quarter results driven by a increased Christmas season sales and increased consumer demand for its branded products.
Shares of the manufacturer of brands such as Mr Kipling and Ambrosia rose 2.7% to 07:45 ET (12:45 GMT).
The company now anticipates that its full-year trading profit will align with the upper end of its previously issued guidance for the financial year 2024/25.
Group sales for the quarter rose 3.1% compared to the same period last year, while branded sales grew by 4.6%, supported by a 7% rise in branded volumes.
“We see this result as reflecting the success of investments into promotional price-points since H2'24, clear delivery of the strategic agenda, and strong execution over the key Christmas period,” said analysts at Jefferies in a note.
In its Grocery division, branded sales climbed 3.5%, while the Sweet Treats business posted an impressive 8.9% growth.
The latter benefited from festive demand, with Mr Kipling recording its best-ever quarter, boosted by a 20% increase in mince pie sales.
Signature ranges, including premium products like Mr Kipling Signature Brownie Bites and Signature mince pies, were particularly successful, reflecting a trend of consumers trading up to treat themselves over the holiday period.
Alex Whitehouse, the chief executive at Premier Foods in a statement flagged the strong performance of the Sweet Treats business during the Christmas period, with Mr Kipling achieving record quarterly sales.
“This has continued over Christmas with our premium ranges such as Ambrosia Deluxe (NYSE:DLX) desserts, Bisto Best gravy and Mr Kipling Signature Brownie Bites performing strongly and we more than doubled the sales of our Mr Kipling Signature mince pies,” he added.
The company's expansion into new categories and international markets demonstrated positive results.
Sales in all targeted overseas regions exhibited 29% growth, indicating successful progress in expanding the company's global reach.
Concurrently, sales within new categories surged by 38%, driven by the strong performance of products such as Ambrosia porridge pots and offerings within the Cape Herb & Spice brand.
The company's recently acquired brands, The Spice Tailor and FUEL10K, demonstrated significant sales growth, achieving double-digit increases.
Whitehouse said that the company's focus is on leveraging innovation and commercial partnerships to optimize the performance of these acquired assets.
“Having delivered very good volume led, branded revenue growth in our key third quarter, we’re now guiding Trading profit to the upper end of expectations for this financial year,” he added.