Trading Statement

Premier Foods plc
05 January 2005


Premier Foods plc ('Premier')

Trading update for the year to 31 December 2004

Operating profits and margins firm and 2004 EBITA(1) anticipated to be within
 the range of market expectations. Positive outlook for 2005.

Premier, one of the leading suppliers of ambient grocery products in the UK, is
providing the following update for the year ended 31 December 2004, ahead of its
preliminary results announcement on 2 March 2005.

We expect total reported grocery sales for the year, including a full year's
contribution from Ambrosia, to be up by approximately 8%. Operating profits and
margins are anticipated to be within the range of market expectations.

Although Christmas sales were slower than expected, after taking into account
the estimated effect of the Bury St Edmunds fire and the associated disruption,
like-for-like grocery sales would have been up by over 1%. The fire effectively
removed two of our most dynamic growth brands for the last 10 weeks of the year
and as a consequence of these lost sales, we expect to show like-for-like
grocery sales broadly flat.

Robert Schofield, Premier Foods plc CEO, said:

'2004 was a tremendously exciting year for Premier with the IPO, and a
significant acquisition. On the downside we had a serious fire at our Bury St
Edmunds factory. Nonetheless, we expect to produce a sound set of results and we
enter 2005 with our business, brands and trading plans in good shape to deliver
ongoing growth'.


Convenience Foods, Pickles and Sauces

Sales for this division are anticipated to be slightly behind 2003's reported
sales of £374.6m, as a result of the fire and associated disruption at our Bury
St Edmunds plant in October 2004, which is estimated to have reduced sales by
approximately £10m. Without this reduction, we anticipate sales for this
division would have been ahead of last year. While discussions to finalise the
detailed insurance claim continue, our estimate of the profit impact on the
results for 2004 remains limited to the £1m excess on the group's insurance
policy.

Some manufacture of Branston Pickle resumed in November 2004 with Loyd Grossman
and other sauce and pickle products recommencing production in December 2004.
The team at the Bury St Edmunds factory are making excellent progress and we
expect the site to be back to full output by the end of February 2005.

As indicated at the time of the interim announcement, we have seen a significant
increase in the price of tin plate, our single largest raw material input.
However, we have been able to agree price increases for our canned products with
our customers to cover a significant proportion of the increased input costs.


Tea and Beverages

Sales for this division are expected to be slightly behind 2003's reported sales
of £143.0m, due to lower retailer brand sales. The transfer of production from
Edinburgh to the Moreton factory has been successfully completed and full year
savings from this rationalisation are still forecast to be approximately £1.0m
per annum.


Spreads and Desserts

Sales for this division of £120.4m in 2003 included one month's contribution
from the Ambrosia business. The Ambrosia business acquired in December 2003, has
traded in line with expectations during the year and ahead of 2003.
Like-for-like sales, which exclude Ambrosia, are anticipated to be ahead of last
year.

Following our recent agreement for the acquisition of the Bird's and Angel
Delight dessert brands, which we announced on 16 December 2004, we are working
closely with Kraft to facilitate the transfer of sales and distribution for the
newly acquired business. This is planned to take place on completion of the deal
on 13 February 2005. Staged transfer of production facilities for these brands
will take place over the balance of the year.


Potatoes

Sales for this division are anticipated to be ahead of 2003's reported sales of
£135.8m as a result of higher market prices. As we indicated at the time of our
interim announcement, trading has improved during the second half of the year
and we are seeing some benefit from the closure of two of its six packing
facilities.

However, we continue to see a competitive environment with continuing supplier
rationalisation among the major retailers expected in 2005 and accordingly we
are continuing to review the future shape and strategy of the business.


Preliminary results for the year ended 31 December 2004 will be announced on 2
March 2005. We will host a presentation to analysts at 9am at ABN Amro, 3rd
floor Conference Suite, 250 Bishopsgate, London, EC2M 4AA.

(1) Earnings before Interest, Tax and Amortisation of Intangible Assets

Enquiries:

Paul Thomas, Finance Director
Gwyn Tyley, Investor Relations Manager
Premier Foods plc Tel: [phone]


Michael Berkeley
Sara Batchelor
Anthony Kennaway
Citigate Dewe Rogerson Tel: [phone]

Notes to Editors

Premier Foods plc is a leading UK manufacturer and marketer of shelf-stable or
'ambient' grocery products and one of the largest suppliers of grocery products
in the United Kingdom. Premier manufactures and markets grocery products for the
retail grocery and out of home channels in three principal product segments:
• convenience foods, pickles and sauces;
• tea and beverages; and
• spreads and desserts.
Premier also operates a potato packing and marketing business in the United
Kingdom, supplying the retail grocery, out of home and food manufacturing
channels.

Premier's branded products include Ambrosia custard and milk puddings, Branston
pickles, Typhoo tea, Hartley's preserves, Gale's honey and lemon curd, Crosse &
Blackwell convenience foods, Sun-Pat peanut butter, Sarsons vinegar, Haywards
pickles, Smash instant mashed potato, Marvel powdered milk creamer and Waistline
salad dressings, soups and cooking sauces. In addition, the Company produces
Cadbury cocoa-based beverages, HP convenience foods, Rowntree's jelly and Loyd
Grossman cooking sauces, soups and salad dressings under agreement or licence.
Premier also produces a range of retailer brand products, principally for the
major multiple retailers.

Premier Foods was floated on the London Stock Exchange in July 2004 when Hicks,
Muse, Tate & Furst sold 80% of its investment in Premier. In October 2004 Hicks,
Muse, Tate & Furst sold their remaining 20% holding. Premier's current market
capitalisation is £676 million (at market close on 4 January 2005).



                      This information is provided by RNS
            The company news service from the London Stock Exchange