Greencore lifts outlook as volume growth accelerates, margin improves

Greencore Group PLC on Wednesday increased full-year profit guidance after a strong third quarter, and said the integration of Bakkavor was progressing well.

The Dublin-based convenience food maker now expects full-year adjusted operating profit for continuing operations to be above current market expectations and in the range of £234 million to £242 million.

This would be nearly double £125.7 million reported in the 52 weeks to September 26, 2025, and above prior company compiled consensus of between £219 million to £231 million.

As a result, shares in Greencore jumped 12% to 248.20 pence each in London on Wednesday, the best performing stock on the FTSE 250, which was marginally lower.

Sales rose 3.2% on a pro forma basis to £1.02 billion in the 13 weeks to June 26, with volume and mix contributing 2.3%, an acceleration in volume growth versus the first half of the financial year.

Price and inflation recovery contributed 0.9%, which reflected continued labour inflation, but was offset by dairy deflation and a decline in protein inflation.

Underlying profit momentum was ahead of expectations in both the legacy Greencore and Bakkavor businesses, driven by a combination of volume growth and continued margin improvement, Greencore said.

Greencore sealed the £1.2 billion buy of fresh prepared maker Bakkavor in January.

Greencore said the integration of Bakkavor continues to progress well, with in-year cost synergies of around £15 million forecast in financial 2026, and £80 million in total.

A more detailed update on the integration progress and delivery will be provided on December 1, alongside full-year results. An update on fourth quarter trading will be issued on October 8.

Cashflow generation across the business was positive during the third quarter and the working capital outflow in the first half of the financial year has already started to reverse. Greencore continues to expect a neutral net working capital position by end of financial 2026.

Fourth quarter trading has started positively, with strong volume momentum continuing from the latter half of the prior quarter.

In addition, Greencore said it continues to explore the potential sale of its US business - which has been treated as a discontinued operation and held for sale asset. The US operation continues to trade positively and in line with expectations.

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