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Leeds-based Northern Foods makes no comment on Batley Fox's biscuit factory as it reports robust Christmas trading

LEEDS-based Northern Foods made no comment on the future of its Fox's Biscuits factory at Batley today as it reported "robust" Christmas trading.

Staff are waiting to find out if Northern Foods will choose Batley or Uttoxeter as the location for a new 40m super-factory.

The firm currently has sites in both towns, but wants to build a bigger more modern facility at one of the two locations.

If the plant is built in Uttoxeter, 1,400 people in Batley could lose their jobs.

Northern, which has previous indicated that an announcement will be made by the end of March, today issued an interim management statement covering the 13 weeks ended December 27 during which it said trading had been "solid".

Group underlying sales for the third quarter - stripping out the impact of currency rate changes, product categories no longer

manufactured, acquisitions and discontinued operations, including the mothballing if its Fenland Foods factory in Grantham,

increased by three per cent which Northern said reflected the continued successful recovery of higher commodity costs.

Total sales for third quarter, including the Fenland impact, were up by 0.5 per cent. In the year to date, underlying sales were ahead by 3.5 per cent with total sales ahead 4.3 per cent.

The company said group trading performance in the third quarter reflected "good progress in a challenging environment".

By division, underlying revenue in chilled foods grew 5.3 per cent and the bakery division saw third quarter underlying revenue rise by 1.9 per cent, with average prices increasing by two per cent.

Northern said its Fox's brand continued to reap the benefits of its "Vinnie" TV advertising campaign which had helped to support sales of premium and seasonal biscuits.

In frozen foods, underlying revenue, before currency, was stable year on year. Average prices rose by seven per cent as commodity cost inflation was successfully recovered, with volumes down by 7.1 per cent as the company exited some marginal own label contracts in pastry and pizza.

Adverse

The adverse impact of the depreciation of sterling against the euro had continued, in line with previous guidance for the current financial year.

During the period, Northern was named by British Airways in its intention to contract for the supply of in-flight meals over a ten year period, starting in April 2010.

Net debt at the end of December was in line with that at the end of the first half year.

Northern said its balance sheet remained strong, two thirds of the net debt being long term to 2012-17, with additional committed facilities of 460mn in place until July 2010.

Stefan Barden, the firm's chief executive, said: "Our key Christmas trading period has been delivered effectively and we continue to respond to the recessionary environment with new value ranges alongside our traditional premium products.

"Northern Foods is now a different company than two years ago; it is both financially and operationally stronger.

"Whilst we share the market uncertainty over consumer spending going forward into 2009, this seems to be less pronounced in food than other sectors.

"We remain confident of maintaining our steady progress and meeting current market expectations for the full financial

year."

ENDS

 
 
 

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