Greencore Group PLC (LON:GNC) has reaffirmed its guidance for 2019 after growth in its food-to-go categories boosted trading in the first quarter of the year.
In an update for the 13 weeks to 28 December, the FTSE 250 food group (and world’s largest sandwich maker) reported revenues from continuing operations of £363.5mln, up 5.8% on a pro forma basis.
READ: Greencore reports full-year earnings rise amid offload of US business but cautions on Brexit
The growth was driven by its food-to-go categories, which increased 6.4%, while across the rest of the group’s operations revenues rose 4.7% pro forma.
The pro forma figures excluded disposed sites and those that had ceased trading, on a reported basis revenue fell 5.7%.
In the period, Greencore said it had received the net proceeds of the disposal of its US business, which it agreed to sell in October, while also repaying certain borrowing sand derivative financial instruments and ending the period in a net cash position.
The firm also said that a tender offer announced in December, which aimed to return £509mln to shareholders at a price of 195p per share, would be conditional on approval at its annual general meeting to be held today.
The Group also completed the refinancing of its primary debt agreements in January, leaving it with committed facilities of £462mln with a weighted average maturity of 4.7 years.
Looking ahead, Greencore said it was reaffirming the statement from its full-year results in December, which anticipated “continued underlying revenue growth” in its convenience food categories as well as a rise in adjusted operating profits from revenue growth, operational performance, and a planned review of its central overheads.
As with last month, the firm said the risks from Brexit were “manageable” in the medium-term, but the near-term challenges of a ‘no deal’ exit were “uncertain”.
“Over the medium term, the Group expects that its market positioning, capability set, customer profile, well-invested asset network and proven economic model will generate strong growth, cash generation and returns.”
Greencore will report its interim results on 21 May.
In a note to clients, analysts at City broker Peel Hunt said the 4.7% pro forma revenue growth had come in ahead of their 2% forecast, adding that if the entire tender offer was not filled at the AGM today the rest would be returned by a special dividend.
In early trading Monday, Greencore shares were up 0.4% at 194.8p.