Premier Foods expects lower consumer marketing spend for 2013 as it aims to 'improve efficiency'

Premier Foods expects its consumer marketing investment to be lower as a result of an improvement in efficiency, the company has claimed, while revealing a fall in sales revenue of 1.7 per cent for the third quarter of the year.

The company, which counts Sharwoods, Hovis, Lloyd Grossman, Oxo and Ambrosia among its brands, revealed its third quarter results, ending 30 September, with a fall of underlying sales of 3.2 per cent, but a rise in sales revenue for its power brands of 4 per cent to £197.7m.

Support brands however saw sales fall by 9.8 per cent for the quarter, reaching £45.6m and non-branded goods fell by 11.4 per cent to £40m over the same period.

The company explained that it was aiming to drive an “improved category return” across its promotional investment and that while marketing expenditure would be lower than in 2012, it would aim to improve the efficiency of its marketing investment, while supporting growth of its branded portfolio.

Gavin Darby, CEO of Premier Foods, stated that he was encouraged by the overall progress the company was making.

He said: "The intensity of promotional activity in our markets remains high while our categories were significantly impacted by the hotter weather in July and early August.

"We continue to make good progress against our strategic priorities supporting our category based approach. We have grown our Grocery Power Brands for a further quarter, completed a major restructuring of our Bread supply chain and our plans to reduce complexity across the business remain on track.

"Against this backdrop, and as the Company enters the important Christmas trading period, expectations for the full year remain unchanged."

Last year, Premier Foods spent £39.4m on its consumer marketing, an increase of 59.5 per cent during 2013, but reported an operating profit of £96.3m as a result.

Join us, it's free.

Become a member to get access to:

  • Exclusive Content
  • Daily and specialised newsletters
  • Research and analysis

Join us, it’s free.

Want to read this article and others just like it? All you need to do is become a member of The Drum. Basic membership is quick, free and you will be able to receive daily news updates.