Geest plc this morning provided the City with an update for the year ended January 3, 2004, prior to entering its close period, and ahead of its preliminary results announcement on March 18. The company confirmed results in line with its expectations.
Group sales are anticipated to show growth of about 12 per cent and UK sales of fresh prepared foods of about 6 per cent. This rate of growth reflects some business losses earlier in the year ñ since offset by other business gains ñ and, said a statement “our commitment to pursue business selectively in the current trading environment”.
Continental European sales are expected to have grown by about 58 per cent, helped by the successful acquisition of Crudi in France in April last year. The remaining business, whole head produce, will see sales growth of around 20 per cent with continued volume growth and some higher prices.
The statement said: “Trading conditions throughout 2003 were challenging with increasing input prices and customer pressure for better value. However, we are achieving price increases and, with total operating profit in line with our expectations, we will again demonstrate strong cash flow generation.
“Looking forward, we have programmes in place which will further improve our levels of productivity and the cost efficiency of our supply chain. The success of these initiatives is essential if we are to create value for our customers and to provide a strong base for improvements in profit.”
Earnings will be enhanced by a one-off tax benefit resulting in an effective tax rate of 16 per cent for 2003. This is expected to return to a more normal 25 per cent in 2004.
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