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Greencore Manton Wood signage

Revenue growth at sandwiches and ready meals giant Greencore has been impacted by factors including the ongoing rail strikes.

In a trading update for the fourth quarter and full year to 30 September 2022, the business reported full-year revenue of £1.7bn, up from £1.3bn in 2021. Adjusted operating profit is expected to be at the lower end of the £72-£77m range given in Greencore’s third-quarter update.

Reporting a drop in revenue growth in Q4 to 23%, versus almost 26% in Q3, the company said this was a result of a stronger comparative period, the volume impact of rail strikes and the unexpected bank holiday following the death of the queen.

Pro forma growth in the quarter had been driven by a combination of increased volumes, a “low-teen” percentage increase in underlying pricing, incorporation of a new ready meals business and higher revenue in Greencore’s Irish ingredients trading business.

“For the full year, we have delivered good year-on-year volume growth while recovering significant levels of ongoing inflation and enhancing profit and cash conversion,” stated the business in the trading update.

“Group pro forma revenue has increased 29% year on year with a 35% increase in food to go categories reflecting volume growth, the onboarding of new business and the impact of inflation recovery.”

Looking ahead, Greencore said consumer demand had held up well, but the business remained cautious about the potential impact of the cost-of-living crisis in the coming year.

“We remain focused on the recovery of inflation through all mechanisms available and are working with our customers and supply partners to mitigate the ongoing impact of the persistently high inflation across the industry on consumer prices,” it added.

“We have substantially recovered the inflation that we have experienced over the last 12 months, and we are making decisions whether to bid for or renew contracts based on their economics, including the ability to recover inflation.”

Former Morrisons boss Dalton Philips joined Greencore last month as CEO, replacing Patrick Coveney.