Greencore Group PLC (LSE:GNC) shares jumped 10% to 244p on Wednesday morning after the convenience food maker upgraded its profit guidance after stronger-than-expected trading and a boost from its takeover of Bakkavor.
The FTSE 250 group said adjusted operating profit for the 2026 financial year is now expected to come in above current City forecasts, which range from £234 million to £242 million, with a consensus of £224 million.
Revenues of £1.02 billion were generated in the third quarter, up 3.2% on a pro forma basis to include Bakkavor, with volumes and product mix contributing most of the increase.
Manufactured volumes grew 0.7%, outperforming a grocery market that contracted by 0.4%. The performance was helped by strong demand for products including quiche, sushi, chilled dips and bread.
Chief executive Dalton Philips said the enlarged group had "never been stronger", pointing to a faster-than-expected integration of Bakkavor following the January acquisition.
Savings were reported in procurement and from removing duplicated central functions, leaving Greencore on track to achieve £15 million of cost synergies this year and at least £80 million annually over time.
The company launched 375 new products during the quarter, including World Cup-themed ranges and summer seasonal lines.
Trading has remained strong into the fourth quarter, with volume momentum continuing and the first cross-selling contract between the legacy Greencore and Bakkavor businesses due to launch in August.
The board is continuing to explore a sale of its US business, which remains classified as a discontinued operation.
Broker Peel Hunt noted that Greencore grew 0.3% and Bakkavor 1.0%, with Greencore "muted due to weather at the start of the period and Bakkavor better with annualised business losses, while profits seemed to have been boosted by operational improvements helping margins.
While the target of £80 million in cost synergies was unchanged, analysts said they expect these "to rise to >£100m".
** UPDATE: Adds share price and broker comments **
