Premier Foods Plc (PFD.L) announced on Thursday that its first-half profit plunged from last year, hurt by integration and restructuring costs.
Profit attributable to equity shareholders was £1.3 million or 0.1 pence per share, lower than £10.2 million or 1.5 pence per share in the prior year period.
During the first half of 2008, the company incurred charges of £19.8 million related to the integration of RHM UK operations, as well as costs of £5.9 million related to the integration of Campbell's UK operations associated with the closure of King's Lynn.
The restructuring of the company's Meat-free business and the commissioning of the new chilled facility at Methwold resulted in costs of £2.3 million. The company also incurred exceptional costs of £13.0 million during the period, including impairment charges of £7.0 million relating to the closure of the Rotherham mill and other redundant assets across the Group.
Adjusted profit was £42.6 million or 5 pence per share, compared to £40.5 million or 5.8 pence per share in the year-ago period.
Loss from continuing operations was £0.6 million or 0.1 pence per share, compared to income of £24.7 million or 3.5 pence per share in the prior year.
Turnover soared 43.5% to £1.29 billion from £899.1 million in the previous year period, due to RHM trading in 2008 compared to the fifteen week post acquisition period last year, as well as the impact of price increases to recover the high levels of input cost inflation experienced over the last twelve months.
Pro forma Group turnover grew 7%, as a result of the price increase, offset by lower sales volumes.
In addition, the company's board proposed an interim dividend of 2.2 pence per ordinary share, payable on January 2, 2009 to shareholders on the register of members at November 28.
Looking ahead, Robert Schofield, chief executive of Premier Foods, said, "Our expectations for the year as a whole remain unchanged, with progress weighted towards the second half as the benefit of all these fundamental actions begin to flow through. The Group will reap the fuller rewards from this strong platform in 2009 and beyond as our focus shifts towards further brand building and innovation."
PFD.L closed Thursday's regular trading session at 92.00 pence, down 5.25 pence or 5.40%.
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