RNS Number:5293L
Greencore Group PLC
27 May 2003



GREENCORE GROUP PLC

Interim statement of results for the half year ended 28 March 2003



Highlights

Half Year Ended 28 March 2003



* Like-for-like sales growth across all three divisions

* Operating profit from continuing operations* up 7% to Euro48.9m

* Constant currency operating profit from continuing operations* up 12%

* Operating margin growth across all three divisions

* Profit before tax* up 9% to Euro31.1m

* Headline EPS* up 2% to 14.1c

* Net interest down 23% to Euro21.9m

* Net debt down Euro66.1m to Euro497.1m



    * before exceptional items and goodwill amortisation





For further information, please contact:


David Dilger, Chief Executive                             Tel: +353 (0)1 6051002
Patrick Kennedy, Chief Financial Officer                  Tel: +353 (0)1 6051003
Billy Murphy/Trish Morrissey, Drury Communications        Tel: +353 (0)1 2605000





Interim Statement

Half Year Ended 28 March 2003



Summary



The Group performed strongly in the first six months of the financial year,
producing excellent results both in terms of profitability and cashflow.


* Profitability

All three divisions increased like-for-like sales and improved operating
margins.  As a result, profit before

tax grew by 9%, or Euro2.6m, notwithstanding a reduction of Euro8.5m in operating
profit from discontinued

activities versus the comparable period.  Headline EPS grew by 2%, with an
increase in the effective tax

rate from 6% to 13% and the reduction in discontinued profitability more than
offset by the strong trading performance.



* Cashflow

Net interest fell by 23% and net debt reduced by Euro66.1m, despite the normal
seasonal increase in working capital at Irish Sugar.  Net debt, at Euro497.1m, was 
Euro376.6m below the level at the end of March 2001 of Euro873.7m.

The benefits of the extensive restructuring which the Group has successfully
undertaken over the last two years are clearly evident from these results.  We 
have created a focused Group with leading market positions, well-invested 
facilities, excellent innovation skills and strong cash generation ability.  We 
are committed to building upon these attributes in the months and years ahead.


* Dividend

In the last two financial years, the Board has decided to maintain, rather than
increase, the level of the interim and final dividend.  The aim was to reduce, 
as swiftly as possible, the indebtedness assumed as a result of the acquisition 
of Hazlewood Foods in 2001.  These results clearly demonstrate the benefits
of this prioritisation, and the Board intends to continue this policy for the
time being.  The Board, however, also wishes to rebalance the weighting between 
the interim and final dividend payments to reflect more closely the relative 
profitability of the first half and second half of the financial year.  An
interim dividend of 5.05c per share will therefore be paid.  Shareholders will
again be offered the option of receiving dividends in the form of cash or 
shares.



Review of Operations

Chilled and Frozen

The Chilled and Frozen division performed very strongly in the first six months.
Like-for-like sales grew by 3%, whilst operating margins from continuing 
operations increased from 5.1% to 6.0%, resulting in a 12% increase in 
continuing operating profit from Euro16.3m to Euro18.2m.  On a constant currency 
basis, operating profit from continuing operations grew by 19%.

The sandwich business enhanced its position as the world's largest sandwich
manufacturer, with its high level of new product development resulting in top 
line growth again ahead of the market.  A number of new ranges were successfully 
trialled with both existing and new customers, the full benefits of which
will be seen in the second half of this year and the next financial year.  Ready
meals continued to trade strongly, whilst the first phase of the expansion of 
both the Warrington and Wisbech facilities will be completed on schedule in the 
second half of the year.

The quiche business made further progress as product innovation and range
extensions helped to deliver good sales growth in the slower winter months.  
Chilled sauces and soup had a satisfactory first half, with strong growth in 
soup sales a particular highlight.  The business has won significant additional
chilled soup trade since the end of the period and further capacity has been
planned to cater for this growth.

The Group's chilled pizza business had a challenging first half.  Although much
was achieved, with the integration of volumes from the Bedford facility closed 
just before the start of the period and the closure and transfer of volumes from 
the Group's other remaining topped pizza facility at Nelson in March, the
necessary efficiency levels have not yet been achieved.  In addition, the focus
on operational improvement has resulted in some sales slippage, although this 
should be, in part, redressed by additional trade won since the end of the half 
year.  Much still remains to be done to generate the returns which are possible 
for a business with a state-of-the-art facility and strong market position in 
this fast growing sector.  Our expectations are for considerable improvement in
performance during the last quarter of this financial year.

Roberts, the Group's frozen savoury and dessert business, experienced a fire at
one of its savoury facilities during the period.  Satisfactory insurance was in 
place and production is being maintained at other Group facilities whilst the 
damaged facility is rebuilt and enhanced. Roberts' market position has not been 
materially impacted, and the frozen savoury market continues to grow in
both value and volume terms.  Meanwhile, further good growth was experienced in 
frozen desserts.

Since the half year end, the Group disposed of its UK chilled sausage business,
J & J Tranfield.


Ambient Grocery

Operating profit from continuing activities grew by 6% from Euro10.4m to Euro11.1m.
Whilst like-for-like sales showed only a modest 0.2% advance over last year's 
levels (due to a sales decline at the baked goods business), operating profit 
margins improved significantly, increasing from 5.4% to 6.4% on continuing
activities.  On a constant currency basis, operating profit from continuing
operations grew by 13%.

The ambient sauces and pickles business performed well, with sales growth driven
by new product development and the successful launch of co-packing contracts 
with two large international branded manufacturers.  Campsie, the Scottish 
mineral water business, benefited from further growth in demand for mineral 
water in the UK.  The cake and dessert business enjoyed a much improved 
Christmas cake season and, as commented on at the AGM, has won additional trade 
which will deliver an improved performance for the full year.  To build upon 
this success, the chilled dessert facility at Bedford was closed in April and 
all chilled dessert production is now consolidated at the Hull facility.

Rathbones, the UK baked goods business, improved its performance over the
comparable period, with the benefits of the rationalisation and cost reduction 
initiatives of the last twelve months helping to offset continued difficult 
market conditions.


Ingredients and Agribusiness*

The division had a strong first half, generating good profitability, high
returns on capital and strong cashflow.  Like-for-like sales grew by 3%, 
operating margins from continuing activities increased from 7.7% to 7.9% and 
continuing operating profit grew by 4% from Euro18.8m to Euro19.6m. On a constant
currency basis, operating profit from continuing operations grew by 6%.

Irish Sugar had a satisfactory first half.  Although sugar beet costs increased
and its sugar quota was reduced by 7,052 tonnes, it benefited from the price 
increase obtained in the second half of the previous year.  In addition, as 
reported at the AGM, an excellent operational performance during the processing
campaign helped to offset the lack of sugar beet availability due to poor
weather.

The profits of the Group's malt business increased, driven by excellent sales
and marketing coupled with further efficiency improvements.  The Group's 
agribusinesses traded satisfactorily, with favourable March weather benefiting 
demand.


* Following the disposal of the fertiliser business, Grassland Holdings, in the
second half of the last financial year, the Board has decided to combine the
results of its remaining agribusinesses within the Ingredients division for
reporting purposes going forward.



Associates

Share of profit of associates, net of share of interest, increased significantly
from Euro1.5m to Euro2.9m.  This principally reflected the inclusion of the flour and 
oatmeal business, Odlums, as an associate, following its partial disposal last 
year and its continued strong trading.  Other associate companies also performed
well, with strong results, in particular, from the Group's yeast associate and
its UK sugar distributor associate.


Financial Review

Like-for-like sales grew by 2.2%, with each division showing growth.  Operating
margins on continuing activities increased from 6.03% to 6.76%, again with each 
division showing growth.  As a result, operating profit from continuing 
activities grew by Euro3.4m, or 7.4%, to Euro48.9m. This growth, together with
the increase in share of profit of associates and the reduction in net interest
payable, more than offset the Euro8.5m reduction in operating profit from 
discontinued activities, resulting in growth of 9%, or Euro2.6m, in profit before 
tax for the year.

The tax charge of Euro4.0m on ordinary activities compares to Euro1.7m in the first
half of last year, with the effective rate increasing from 6% to 13%, reflecting 
the increased level of profitability in higher tax jurisdictions.

The exceptional cost within operating profit of Euro2.9m relates to start-up
inefficiencies at the new pizza facility (as the additional trade from the 
closed Bedford and Nelson facilities was transferred), whilst a net surplus of 
Euro0.6m was recorded on the closure of the Nelson pizza facility and two 
facilities damaged by fire.

Headline earnings per share (adjusted to eliminate exceptional items and
amortisation of goodwill and finance facility costs) increased by 2.2% from 
13.8c to 14.1c.  Basic earnings per share increased from 2.1c to 6.3c.

Net debt reduced by Euro66.1m to Euro497.1m, benefiting from a particular focus on
cash generation across the Group, as well as a translation benefit of Euro33.2m on 
the sterling element of the Group's indebtedness.  This result is particularly 
satisfactory in light of the normal seasonal increase in working capital at 
Irish Sugar.

Significant capital investment was made in the period, most particularly in the
chilled ready meals category; notwithstanding that, net capital expenditure 
declined from Euro25.1m in the same period last year to Euro19.4m.  Net cash of Euro3.6m 
was received in respect of taxation, reflecting the modest amount of
tax payable across the Group and a tax refund received in Continental Europe.


Outlook


The Group is well positioned to continue to generate good growth in
profitability from continuing operations combined with continued strong cash 
generation and further reductions in interest payable.

The market dynamics in the two convenience food divisions remain attractive and
the Group's performance will continue to be underpinned by its strong market 
positions and excellent innovation skills, as well as specific initiatives in 
the individual businesses.  Whilst much remains to be done in certain sectors to 
achieve an appropriate return on capital, most particularly in pizza and bread, 
we are confident of driving continued improvement in these businesses.

The Ingredients and Agribusiness division is well positioned to continue to
generate substantial cashflow and very satisfactory returns on capital.  Irish 
Sugar will benefit from its second price increase in successive years, which 
will help to offset continuing inflation in its cost base, whilst the 
competitiveness of the Group's largest malt operation in the UK should be 
significantly improved if the recent weakness in sterling is not reversed.

The Group has been transformed over the last two years and now has a
well-balanced, robust portfolio of businesses, which provides a solid platform 
for both profit growth and cash generation.

E F Sullivan
Chairman


27 May 2003




Note

Like-for-like sales are calculated on a constant currency basis from continuing
operations adjusted for facilities damaged by fire.





Consolidated Profit and Loss Account (Unaudited)

Half Year Ended 28 March 2003

_______________________________________________________________________________________

                                    Half year ended 28 March 2003          Half year to
                       Notes                     Exceptional                   29 March                                 
                                    Ordinary       items and       Total           2002
                                  activities    amortisation       Euro'000          Euro'000
_______________________________________________________________________________________

Turnover
Continuing                 
operations                 2       723,727               -       723,727        754,444

Discontinued                        
operations                          20,092               -        20,092        182,094
                                __________      __________    __________     __________

                           2       743,819               -       743,819        936,538
                                __________      __________    __________     __________

Operating profit
before goodwill
amortisation and
exceptional items

Continuing                 
operations                 2        48,894               -        48,894         45,530

Discontinued                         
operations                           1,242               -         1,242          9,784
                                __________      __________    __________     __________

                           2        50,136               -        50,136         55,314

Goodwill                                 -         (10,701)      (10,701)        (9,228)
amortisation
Exceptional items          3             -          (2,927)       (2,927)        (6,147)
                                __________      __________    __________     __________

Operating profit                    50,136         (13,628)       36,508         39,939

Share of operating
profit of
associated                           
undertakings                         3,032               -         3,032          1,514
                                __________      __________    __________     __________

                                    53,168         (13,628)       39,540         41,453
                                __________      __________    __________     __________

Exceptional items
Termination/disposal
of operations
Net surplus over book      
value                      3             -             576           576            974
Goodwill previously        
written off to
reserves                   3             -               -             -         (7,838)
                                __________      __________    __________     __________

                                                       576           576         (6,864)
                                __________      __________    __________     __________

Profit before                       
interest and
taxation                            53,168         (13,052)       40,116         34,589

Net interest                       
payable                            (21,925)              -       (21,925)       (28,387)

Amortisation of issue                    
costs of finance
facility                                 -          (2,291)       (2,291)        (1,318)

Share of interest                     
(payable)/receivable
- associates                          (138)              -          (138)            15
                                __________      __________    __________     __________
Profit before                       
taxation                            31,105         (15,343)       15,762          4,899

Taxation                            (3,966)            631        (3,335)           (39)
                                __________      __________    __________     __________
Profit after                        
taxation                            27,139         (14,712)       12,427          4,860

Minority interests                    (650)              -          (650)          (866)
                                __________      __________    __________     __________
Profit attributable                 
to Group                            
shareholders                        26,489         (14,712)       11,777          3,994

Dividends                  4        (9,537)              -        (9,537)        (8,204)
                                __________      __________    __________     __________
Retained profit/                    
(loss)                              16,952         (14,712)        2,240         (4,210)

                                ==========      ==========    ==========     ==========

Adjusted earnings per      
ordinary share             5                                       14.1c          13.8c

Basic earnings per         
ordinary share             5                                        6.3c           2.1c

Diluted earnings per       
share                      5                                        6.2c           2.1c

Dividend per ordinary      
share                      4                                       5.05c          4.38c




Consolidated Balance Sheet

At 28 March 2003

______________________________________________________________________________

                                       28 March       29 March    27 September
                                           2003           2002            2002
                                    (Unaudited)    (Unaudited)       (Audited)
                                          Euro'000          Euro'000           Euro'000
______________________________________________________________________________

Fixed assets
Intangible assets                       381,075        363,777         391,773
Tangible assets                         540,955        647,105         586,180
Financial assets                         16,437         18,167          16,784
                                     __________     __________      __________

                                        938,467      1,029,049         994,737
                                     __________     __________      __________
Current assets
Stocks                                  187,443        239,185         137,662
Debtors                                 119,961        182,507         178,974
Cash and bank balances                   99,846        190,073         103,256
                                     __________     __________      __________

                                        407,250        611,765         419,892
Creditors
Amounts falling due within one          
year                                    388,417        510,723         396,053
                                     __________     __________      __________

Net current assets                       18,833        101,042          23,839
                                     __________     __________      __________

Total assets less current               
liabilities                             957,300      1,130,091       1,018,576
                                     __________     __________      __________

Creditors
Amounts falling due after more          
than one year                           621,295        811,024         693,395
Provisions for liabilities and           
charges                                  44,013         35,941          46,323
Development grants                        1,513          2,146           2,332
                                     __________     __________      __________

                                        666,821        849,111         742,050
                                     __________     __________      __________

Net assets                              290,479        280,980         276,526

                                     ==========     ==========      ==========

Capital and reserves
Called up share capital                 122,058        121,094         121,584
Capital conversion reserve fund             934            934             934
Share premium account                    87,280         84,898          85,847
Profit and loss account/other            
reserves                                 74,969         68,808          63,535
                                     __________     __________      __________
Shareholders' funds - equity            
interests                               285,241        275,734         271,900
Minority interests - equity               
interests                                 5,238          5,246           4,626
                                     __________     __________      __________

                                        290,479        280,980         276,526

                                     ==========     ==========      ==========



Consolidated Cash Flow Statement

Half Year Ended 28 March 2003

______________________________________________________________________________

                                                  Half year to    Half year to
                                                      28 March        29 March
                                                          2003            2002
                                                   (Unaudited)     (Unaudited)
                                                         Euro'000           Euro'000
______________________________________________________________________________

Operating activities
Operating profit                                        50,136          55,314
Depreciation (net of grant amortisation)                23,105          29,357
Changes in working capital                              (4,115)         13,382
Other (including cash effect of exceptional              
items)                                                   6,662          (5,225)
Capital expenditure (net)                              (19,438)        (25,098)
                                                    __________      __________

Cash flow from operating activities                     56,350          67,730
Dividends from associates                                2,621             925
Returns on investments and servicing of                
finance                                                (16,001)        (27,979)
Taxation                                                 3,575          (4,490)
Proceeds on issue of share capital                         124             317
Disposal of subsidiary and associated                        
undertakings                                                 -          19,513
Net debt disposed of                                         -          22,510
Equity dividends paid                                  (13,739)        (15,453)
                                                    __________      __________

Net cash flow                                           32,930          63,073
Translation differences                                 33,184          (8,137)
                                                    __________      __________

Movement in net debt in period                          66,114          54,936
                                                    __________      __________

Net debt at start of period                           (563,173)       (722,638)
                                                    __________      __________

Net debt at end of period                             (497,059)       (667,702)

                                                    ==========      ==========



Statement of Total Recognised Gains and Losses
Half Year Ended 28 March 2003

______________________________________________________________________________

                                  Half year to    Half year to    Full year to
                                      28 March        29 March    27 September
                                          2003            2002            2002
                                   (Unaudited)     (Unaudited)       (Audited)
                                         Euro'000           Euro'000           Euro'000
______________________________________________________________________________

Profit for period attributable          11,777           3,994          10,131
to Group shareholders
Exchange adjustments                     9,194           2,219           2,531
Prior year adjustment                        -           1,600           1,600
                                    __________      __________      __________

Total recognised gains for the          
period                                  20,971           7,813          14,262
                                    __________      __________      __________



Notes

Half Year Ended 28 March 2003



1. Basis of preparation

The interim statement for the six months to 28 March 2003 is unaudited and was
approved by the Board on 26 May 2003. The information has been prepared on the 
basis of the accounting policies set out in the Group's annual report for the 
year ended 27 September 2002. The balance sheet information for 27 September 
2002 represents the audited balance sheet from the Group's full accounts for 
that year on which the Auditors issued an unqualified audit report and which 
have been filed with the Registrar of Companies.

2. Analysis of results by activity
                                  Turnover               Operating profit*
                                  Half year                  Half year
                                  2003          2002          2003          2002
Total Group                      Euro'000         Euro'000         Euro'000         Euro'000
Chilled and Frozen             322,378       381,075        19,471        19,625
Ambient Grocery                173,698       246,567        11,063        12,957
Ingredients and                
Agribusiness                   247,743       308,896        19,602        22,732
                            __________    __________    __________    __________

                               743,819       936,538        50,136        55,314
                            __________    __________    __________    __________
Continuing Activities
Chilled and Frozen             302,286       318,574        18,229        16,291
Ambient Grocery                173,698       191,558        11,063        10,405
Ingredients and                
Agribusiness                   247,743       244,312        19,602        18,834
                            __________    __________    __________    __________
                               723,727       754,444        48,894        45,530
                            __________    __________    __________    __________

* pre goodwill amortisation and exceptional items


3. Exceptional items

The current period exceptional charge comprises a cost of Euro2.9m in respect of
commissioning costs at the Group's new chilled pizza facility. In addition, a 
net surplus of Euro0.6m was recorded on the closure of certain Group facilities in 
the United Kingdom.


The charge in the prior period reflects restructuring costs, primarily related
to commissioning projects undertaken by the Group in the period, of Euro6.1m, and a 
net loss of Euro6.9m after reinstating goodwill of Euro7.8m on the part disposal of a 
former subsidiary.


4. Dividends

The interim dividend of 5.05c (2002: 4.38c) per share is payable on 30 September
2003 to shareholders on the Register of Members, as at 6 June 2003. The ordinary 
shares will be quoted ex-dividend from 4 June 2003. The dividend will be subject 
to dividend withholding tax although certain classes of shareholders may qualify 
for exemption.

5. Earnings per share

The calculation of earnings per share is based on earnings of Euro11.78m (2002:
Euro3.99m) and on 188.3 million ordinary shares (2002: 187.2 million) being the 
weighted average number of ordinary shares in issue in the period. The 
calculation of adjusted earnings per share is after adjusting for exceptional
items, goodwill and facility fee amortisation. The diluted earnings per share
has been calculated on the basis of 188.7 million ordinary shares (2002: 
187.6 million). The calculation of earnings per share excludes 4.9 million 
treasury shares arising from the share repurchase programme.


6. Information

The interim report is being sent by post to all registered shareholders.


Copies are also available to the public from the Company's registered office at
St. Stephen's Green House, Earlsfort Terrace, Dublin 2 and from its registrar, 
Computershare Investor Services (Ireland) Limited, Heron House, Corrig Road, 
Sandyford Industrial Estate, Dublin 18.




* * * Press Release As Follows * * *


GREENCORE GROUP PLC

Interim statement of results for the half year ended 28 March 2003


Highlights

Half Year Ended 28 March 2003


* Like-for-like sales growth across all three divisions

* Operating profit from continuing operations* up 7% to Euro48.9m

* Constant currency operating profit from continuing operations* up 12%

* Operating margin growth across all three divisions

* Profit before tax* up 9% to Euro31.1m

* Headline EPS* up 2% to 14.1c

* Net interest down 23% to Euro21.9m

* Net debt down Euro66.1m to Euro497.1m


* before exceptional items and goodwill amortisation






Commenting on the results, Greencore Group Chief Executive, David Dilger, said:

"These are very strong results both in terms of profitability and cashflow, and
are a product of the extensive restructuring which the Group has successfully
undertaken over the last two years.

The Group remains on course to deliver full year earnings per share in line with
consensus analyst forecasts."









For further information, please contact:

David Dilger, Chief Executive                            Tel: +353 (0)1 6051002
Patrick Kennedy, Chief Financial Officer                 Tel: +353 (0)1 6051003
Billy Murphy/Trish Morrissey, Drury Communications       Tel: +353 (0)1 2605000






                      This information is provided by RNS
            The company news service from the London Stock Exchange
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