Greencore Group PLC
3 April 2001
GREENCORE GROUP PLC
CONTACT: MR. B.J. POWER TELEPHONE 353 1 605 1029
FAX 353 1 605 1104
GREENCORE PRE-INTERIM CLOSE PERIOD UPDATE
The following is the basis of an update that will be provided to analysts
before Greencore enters its close period prior to its interim results which
will be announced on 5 June 2001.
Good progress in relation to the re-organisation and integration of the
recently acquired Hazlewood continues to be made. As anticipated in the
circular relating to the acquisition, it is expected that annual cost savings
of over Stg£7m will be achieved by the end of the second full year following
the acquisition. Significant progress towards this has already been achieved
by the closure of the Derby Head Office, the streamlining of the divisional
structure, the commencement of bread supply from Kears to the sandwich
business and the implementation of a comprehensive improved procurement
programme through the enlarged Group. The combination of Greencore's pizza and
ambient sauce operations with the equivalent Hazlewood businesses has also
commenced. Two major new facilities, representing a combined investment of
over Stg£30m, have come on stream since acquisition with the sandwich factory
at Manton Wood being commissioned on time and on budget, while the cake bakery
at Hull has experienced some delays which are now being overcome.
Excellent progress towards restructuring loss making operations has been made
through the sale of the FH Lee paper business and the Rowan ready meals
operation together with the recent decision to close the Dunstable frozen
ready meals business. While still at an early stage, the sale process of other
non-core activities is proceeding in line with the timetable and plan.
Trading within the newly acquired Hazlewood businesses has generally been in
line with expectations. However, ready meals continues to under-perform and,
in pies and sausages, the impact of Foot and Mouth issues over recent months
has contributed to under-performance.
In relation to the non-Hazlewood businesses, trading has also generally been
in line with expectations with the exception of U.K. baking where, in a very
difficult market, results for the first-half will be significantly below those
achieved in a strong first-half of last year. Second half results for baking
are anticipated to be similar to the second half of last year. Malt results
are expected to show improvement in the year as a whole although this
improvement will be weighted towards the second-half. First half results will
also be affected by the late start to the key spring selling season in the
agribusiness sector because of adverse weather conditions.
David Dilger, Chief Executive of Greencore said 'The acquisition of Hazlewood
positions the Group in higher growth UK and Continental European convenience
food markets. Management continues to focus its energy on maximising cost
savings, restructuring loss making operations and reducing debt. While much
work remains to be done, we are encouraged by the progress made so far in the
integration process and by the high quality of both the people and assets
acquired with Hazlewood. I am confident that the acquisition will deliver
improved prospects and future growth to the Group'.
DIRECTOR & SECRETARY
GREENCORE GROUP PLC,
ST. STEPHEN'S GREEN HOUSE,
DUBLIN 2. 3rd April, 2001.