Northern moves away from meat

Healthy eating is pushing Northern Foods away from the meat sector, it has revealed in its annual review.

The company announced a year of "real progress", following a major disposal programme, but its frozen meat and pastry divisions continued to disappoint and Northern is now shifting its focus to the "meat-free" market.

After successfully completing the disposal of businesses representing 40% of its total annual revenue, Northern Foods achieved a 21.2% increase in profit before tax, to 31 March, 2007, and profit from operations was maintained at last year's level. Sales were up 3% at £890m.

The chilled division saw significant improvement, with its continuing revenue up by 7.4% to £446.7m. These improvements in performance, however, were offset by a decline in frozen operations, with continuing profit from operations down by 17% to £19m.

In his annual review, Stefan Barden, chief executive of Northern Foods, stated that these declines reflected healthy-eating trends. "The meat and pastry markets have faced significant challenges in the past year, as consumers change their diets," he said. "As a result, our Dalepak meat grill and Holland's meat pie brands have disappointed."

Declining sales of meat products have led Northern Foods to move progressively into the meat-free arena and, since the launch of Grassington's Food Co, its meat-free market share has reached 10.8%.

However, Barden stated that the company will continue to support product and brand development in the meat divisions, since "it will take some time for the meat-free brand to fully replace the decline in sales and productivity in the meat grills area."

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