Premier Foods says it is still on track to make exceptionally high profits even after reducing a number of fees that its clients had to pay before Christmas, even as branded goods suppliers continue to be questioned about the fairness of their prices.
Premier, which is also the parent company of Bisto, Loyd Grossman, and Oxo, reported that group sales in its third quarter increased by 14.4% when compared to the same time last year.
It stated that sweets led the performance, increasing by 21.3% in value.
It stated that it was on track to meet its previously expanded expectations for annual profits and claimed gains in market share of more than 120 basis points.
Much of the sales growth, according to Premier, was attributed to a series of discounts offered during the Christmas quarter. These price reductions are probably what supermarket chains passed on to their customers because of intense promotional activity.
In an effort to keep customers loyal for the big Christmas shop, chains reduced the price of groceries by one-third in December, according to a report released by Kantar Worldpanel after the holidays.
“The lower promotional price points we introduced in the third quarter have positively impacted performance while also helping consumer budgets go further,” stated Alex Whitehouse, Chief Executive.
“These lower prices will be extended to additional products such as Loyd Grossman cooking sauces and Mr Kipling Bakewell slices in quarter four.”
Premier’s stock increased slightly when the market opened.
The Competition and Markets Authority (CMA) will be interested in its profitability level as it looks into whether price increases in the grocery sector since Russia’s invasion of Ukraine have been reasonable.
After absolving supermarkets of any profiteering, the regulator has been investigating the supply chain, paying particular attention to branded goods suppliers who have been blaming price increases on rising energy and commodity costs.
