Premier Foods jumped 10% as it said it will get a substantial cash boost after agreeing on a suspension of payments into its pension scheme from April, earlier than expected, due to the good performance of the fund since 2020.
As a result, the Ambrosia, Bird’s Custard and Mr Kipling owner will benefit from £33 million increased free cash flow for the financial year ending 29 March 2025.
Subject to the next triennial valuation results, Premier Foods also anticipates no further contributions to be payable after this date.
Duncan Leggett, Premier’s chief financial officer, said: “This suspension of pension payments substantially increases the free cash flow available to us and presents us with enhanced capital allocation options to deliver on our growth ambitions.”
Shares rose 14p to 152.8p.