Premier Foods reveals boost from Jubilee campaign

Monday 22 October 2012

Consumer-facing stocks will dominate the corporate agenda this week with Whitbread, Premier Foods and Debenhams due to post updates.

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Mr Kipling parent Premier Foods will reveal how it fared in recent trading after a first half that was boosted by its "Great British Fancies" campaign for the Queen's Diamond Jubilee.

The St Albans-based group saw a 2% rise in interim sales of its eight frontline brands thanks in part to the launch of a patriotic range of Mr Kipling cakes and a major advertising push.

Its main brands – which also include Hovis bread, Bisto, Ambrosia and Loyd Grossman sauces – delivered a 3.2% rise in half-year trading profits to £53.2 million.But the market will be keen for news on whether the summer of celebration surrounding the Olympics maintained strong sales in the group's third-quarter update tomorrow.Investec expects a £30m rise in pre-tax profits for this year to £88m, but warned the second half could be hampered by rising wheat costs.Department store Debenhams reports full-year results on Thursday after a resurgent performance in recent months.The group ended its year on a high, reporting a 3.7% hike in like-for-like sales excluding VAT in the 10 weeks to September 1.Online sales were particularly strong, up 40%, and it grew its share of the under-pressure womenswear market. The group is thought to have benefited from a store modernisation programme, its Life Made Fabulous TV advertising campaign and overseas expansion.But Matthew Taylor, analyst at Numis Securities, said annual pre-tax profits were expected to remain largely flat at £158m against £157.7m a year earlier as lower profit margins offset the rise in sales.Leisure group Whitbread will reveal a jump in half-year profits tomorrow as its Costa and Premier Inn businesses continue to deliver market- beating performances.Costa, which has nearly 1400 outlets in the UK, and Premier Inn have been the top performers in the group's portfolio, which also includes restaurants Beefeater and Brewers Fayre.Parent group Whitbread is expected to reveal a 10% leap in pre-tax profits in the six months to August 16 of £191m, on a 14% rise in revenues to £1 billion.The rise in profits will come off strong like-for-like sales at Costa, up 7.1% in the period, and Premier Inn, up 4%.Shares in Whitbread are 40% higher than they were at the start of the trading period.Geof Collyer, research analyst at Deutsche Bank, said: "We remain positive for the longer term, but think that the group needs to give out some strong current trading messages in hotels and restaurants for the shares to kick on from here."Home Retail Group has cheered investors in recent months with a return to sales growth at catalogue chain Argos as demand for iPads and Kindles has offset declining interest in video games and MP3 players.Shares in Home Retail Group have jumped more than 50% since August as the group surprised the markets with its improving performance.However, same-store sales at Home Retail's Homebase chain continued to fall in the second quarter, by 3.7%, as weather dampened demand for seasonal products. Argos, which has some 750 stores, is looking to recover from months of dire trading, which prompted Home Retail to axe its dividend pay-out.Online retailer ASOS will unveil results on Thursday following its recent coup in appointing two major names, former M&S director Kate Bostock and former Amazon UK boss Brian McBride, to its board.The group's figures on Thursday are expected to confirm that ASOS has held its own in a fiercely competitive market.

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Premier Foods reveals boost from Jubilee campaign

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