"Complex, risky and not in control of its own destiny." That was the verdict from Shore Capital analysts after Premier Foods unveiled a first-quarter sales slump this week.
The share price tumbled 11.8% on Tuesday after it revealed its sales fell by more than 5% in value for the first quarter, including a 13% fall in own-label sales.
Premier branded the reaction from analysts "disappointing" and claimed it was treated more harshly than many rivals because of historical difficulties.
"Volumes are up 2% on brands. And we confirmed we will be paying down £100m of debt over the year, while maintaining our sales across the year," said a Premier insider. "Over a 13-week period, it's true total sales reduced by 5%. But the reason was that own label reduced by 13%. We do have underlying issues in own label but contracts come and go, and we know what's coming in the second half. The trouble with analysts is, if Premier says we've got a cold, they say we've got pneumonia."
Another senior source with close links to the company also branded the analysts who gave Premier a sell rating as "superficial".
"The reason they are saying sell is the 13% fall in own-label sales, but these contracts often come and go," he said. "Should Premier keep hold of these contracts, which aren't making any money, just so its sales column looks better when it reports?"
Sales of Premier's key brands, including Mr Kipling, Sharwood's and Ambrosia were up 3.4% in value and 6% by volume.
The share price tumbled 11.8% on Tuesday after it revealed its sales fell by more than 5% in value for the first quarter, including a 13% fall in own-label sales.
Premier branded the reaction from analysts "disappointing" and claimed it was treated more harshly than many rivals because of historical difficulties.
"Volumes are up 2% on brands. And we confirmed we will be paying down £100m of debt over the year, while maintaining our sales across the year," said a Premier insider. "Over a 13-week period, it's true total sales reduced by 5%. But the reason was that own label reduced by 13%. We do have underlying issues in own label but contracts come and go, and we know what's coming in the second half. The trouble with analysts is, if Premier says we've got a cold, they say we've got pneumonia."
Another senior source with close links to the company also branded the analysts who gave Premier a sell rating as "superficial".
"The reason they are saying sell is the 13% fall in own-label sales, but these contracts often come and go," he said. "Should Premier keep hold of these contracts, which aren't making any money, just so its sales column looks better when it reports?"
Sales of Premier's key brands, including Mr Kipling, Sharwood's and Ambrosia were up 3.4% in value and 6% by volume.
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