Demand for ready meals boosts Northern Foods

NORTHERN Foods has seen 7% growth in like for life sales in the second quarter of the year fuelled by a dramatic rise in sales of ready meals.

The company behind brands including Fox’s Biscuits and Baxenden-based Holland’s pies, also announced it is restructuring the business into two divisions responsible for branded and chilled foods.

Northern Foods said the restructuring, which could cost up to £6m, will streamline the business and deliver savings that will benefit the bottom line by the end of next year.

In the second quarter, sales of chilled foods rose by more than 16%, driven largely by improved figures on ready meals, a performance mirrored by sandwich and salad sales which were helped by new contract wins from British Airways and Costa Coffee.

Bakery sales were up by almost 11% but this was offset by figures on frozen food which were down by 16%.

Stefan Barden, chief executive of Northern Foods, said: “We are taking decisive actions to ensure that we are well positioned for the competitive market conditions which we are experiencing and expect to continue.

“Our finances remain strong and we continue to trade in line with expectations.”

Overall, like-for-like sales for the first half of the year were up by 3%.

The company said its investment in the Goodfella’s pizza brand will deliver an improved performance in the second half and its plans for new technology in the production of Fox’s Biscuits are “proceeding to plan”.

However, it declined to comment on the fate of Neil Court-Johnson, the managing director of its Holland Pies business who has been suspended since June following allegations that he was hatching a plan to buy-out the business.

A spokesman said: “We are not able to discuss internal issues.”