Premier Foods, the UK food manufacturer best known for brands such as Mr Kipling, Ambrosia, Bisto, and Oxo, has reported mixed results in its Q1 trading update for the 13 weeks ended 28 June 2025. While the group’s sweet treats segment demonstrated impressive growth, certain grocery categories saw a decline amid warmer weather conditions.

The company’s overall group branded sales rose modestly by 1.2%, despite facing strong comparative figures from the previous year. However, grocery revenue fell by 2.7% to £174.7 million, reflecting softer demand for products like soup, gravy, and stock, which are more reliant on traditionally colder weather. These categories particularly struggled as the UK experienced higher-than-average temperatures during the quarter, dampening consumer appetite for hot comfort foods. In contrast, new categories delivered strong performance, with revenues up 38%, thanks to successful products such as Ambrosia porridge pots and Cape Herb & Spice, which capitalised on further distribution gains.

The standout performer was the Sweet Treats branded segment, which grew by an impressive 11.4%. Premier Foods attributes this success substantially to its innovation programme, with new product launches resonating well with consumers. Notably, the introduction of Mr Kipling birthday cake tarts—a product inspired by a popular US trend—performed strongly, driving volume-led growth in the category. The cake segment also experienced volume and value market share gains during the quarter.

Chief Executive Officer Alex Whitehouse emphasised this success, stating that branded sales growth was again led by strong performance in Sweet Treats, underpinned by innovation. Looking ahead, Premier Foods plans to sustain its momentum by launching new items such as FUEL10K yogurt and granola pots, which are expected to bolster branded revenue growth further over the course of the year. Whitehouse reaffirmed the company’s full-year trading profit expectations, supported by its branded growth model and ongoing cost efficiency initiatives.

Despite these encouraging developments, the company’s overall revenue growth remained muted, with total group revenue reported slightly up by 0.3% to £240 million, as economic pressures including inflation and rising operational costs continue to pose challenges. This cautious outlook was reflected in a 6.1% drop in Premier Foods’ share price following the Q1 update. While the CEO had previously mentioned potential price adjustments to manage input cost pressures, no specific changes were announced in the latest report.

Premier Foods’ broader financial performance has been notably strong over the last financial year, with headline revenue rising by 3.5% and branded revenue up 5.2%. The company achieved trading profit growth of 6%, alongside a substantial 62% increase in dividend per share, reflecting robust cash flow and improving financial health. This growth was supported by premiumisation strategies that enhanced the appeal of flagship products like Ambrosia Deluxe and Mr Kipling Signature Bites. Moreover, international sales expansion contributed significantly, with overseas revenue growing by 23%.

While Premier Foods’ Q1 results highlight the resilience and appeal of its sweet treats and new product categories, the impact of weather on traditional grocery lines underscores ongoing volatility in consumer demand. The company’s ability to innovate and capture market share in growing segments will be crucial as it navigates economic headwinds and changing consumer preferences throughout the remainder of 2025.