FTSE 250 movers: Price increases at Premier Foods

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Date: Tuesday 13 May 2008

LONDON (ShareCast) - Shares in Hovis and Campbell's Soups owner Premier Foods improved as the group passed on to customers most of the increases in foodstuff costs seen last year.

"Sales growth of 6.3% primarily reflects the pricing action taken to recover the cost inflation we experienced in the second half of 2007 and we are pleased to have now implemented the necessary price increases. Trading profit is also in line with our expectations with, as previously indicated, the synergies from the integration of Campbell's and RHM being broadly offset by the delay in recovering cost inflation and lower bread volumes compared to the same period in 2007," it sid.

Grocery sales were 2.4% higher in the first four months of 2008. Recovery of commodity cost inflation is the main driver of the sales growth with sales volumes broadly in line with last year.

Bakery and milling sales were 14.4% higher in the first four months compared to the same period in 2007, due to higher prices partly offset by lower volumes. Sales of Hovis stabilised.

Housebuilder Redrow has warned the conditions in the housing market have worsened faster than it expected with reservations down 50% on this time last year due to a lack of mortgage availability.

"As at the end of April, our order book in the Homes operations was 26.5% down on last year. In the second half of our financial year, net reservations to date have been running at just under 50% below the levels secured in the same period last year," it said.

"Until recently, cancellation rates have been running at just over 20% but we have experienced a marked increase since Easter. It is becoming increasingly difficult to predict accurately reservation and cancellation rates," it added.

Completion this year are now forecast to be approximately 10% below its previous estimate while heavy incentives to enourage sales are hitting margins hard.


FTSE 250 - Risers
Misys (MSY) 179.00p +6.71%
ITE Group (ITE) 163.25p +5.15%
Yell Group (YELL) 200.50p +3.08%
LogicaCMG (LOG) 125.75p +2.86%
Southern Cross Healthcare Group (SCHE) 392.00p +2.35%
Premier Foods (PFD) 133.25p +2.11%
Informa (INF) 397.50p +1.99%
Findel (FDL) 295.50p +1.72%
Dimension Data Holdings (DDT) 51.00p +1.49%
Stagecoach Group (SGC) 258.25p +1.47%

FTSE 250 - Fallers
Collins Stewart (CLST) 106.00p -7.63%
Assura Group (AGR) 87.50p -6.91%
Grainger (GRI) 364.00p -6.73%
Bradford & Bingley (BB.) 161.75p -6.50%
eaga (EAGA) 108.00p -6.09%
Redrow (RDW) 276.50p -5.55%
Quintain Estates & Development (QED) 424.25p -5.41%
Aricom (ORE) 80.25p -5.31%
Morgan Crucible (MGCR) 226.75p -5.13%
Chloride Group (CHLD) 265.75p -5.09%

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