Essenta Foods unveils new divisional bosses and confirms commitment to USA

Food to Go will be headed up by Kuldip Kular from Northern Foods; Food for Later will be led by Diane Walker from Greencore, Brands will be led by Graham Hunter from Northern Foods and Convenience USA will be led by Greencore’s Liam McClennon.

The structure highlighted Essenta Foods'​ commitment to driving the fledgling US business, ​which was launched by Fergal Leamy in 2008, said a Greencore spokesman.

The division operates from two sites, one in Newburyport, Massachussetts, which makes prepared salads, desserts, entrees, starches, vegetables, quiche, pot pies, soups and stews; and one in Cincinnati, which makes sandwiches.

Sales at the division were up 18% in the year to September 24, 2010, although significant investment in “factory, operating and business improvement processes”​ had dented profits, said the firm.

No 1 in fresh sandwiches, North Eastern USA​

“From a standing start in 2008, we have attained number one market positions in the North Eastern US in the fresh manufactured sandwiches and leaf salads markets with number two positions in chilled entrees and chilled quiche.”​

A significant re-fit of the Newburyport facility to improve standards and increase capacity was now “substantially complete”​, said Greencore, which is continuing to search for suitable bolt-on acquisitions but to date has “not identified a target which reflects the right combination of category competence, manufacturing capability and valuation”. ​

However, it had sufficient capacity at its two existing sites to meet market growth for the next two years.

Greencore had envisaged operating around nine sites by around 2016, with three in the north-east, three in the mid-west and three on the west coast, Leamy told FoodManufacture.co.uk last summer.

However, he admitted that "there aren't that many acquisition opportunities in chilled prepared foods here, which is why we moved into this market" .​

Greencore FY: sharp resurgence in chilled ready meals​

A sharp resurgence in sales of chilled ready meals helped drive Greencore’s group operating profits up 17.6% to €59.7m on sales up 6.9% to €856m in the year to September 24.

Sales of prepared meals were up 22% as shoppers that had ‘retreated’ from the category returned, said chief executive Patrick Coveney, who will take the helm at Essenta Foods.​

“The chilled ready meals market grew in volume by 7.7% in the 52 weeks to 3 October 2010 with Greencore growing its prepared meals sales by 22% in the same period.”​

Elsewhere, it was continuing to experience “buoyant demand for our convenience food offerings​”, said Coveney.

He also pointed to a “significant shift in consumer behaviour"​ over the past year: "​The down-trading to cheaper sandwiches which was a feature of the market a year ago has now reversed with market value growth exceeding volume growth in the final quarter.”​

Grocery: Range rationalisation​

Greencore’s grocery arm, which makes ambient cooking sauces, pickles and table sauces, has undergone a major range rationalisation process this year as part of a plan to eliminate non-economic product lines, said the firm.

“At the end of full-year 2010, the category had 470 stock keeping units down from 1,257 in 2007. As a result returns and profitability have improved significantly.” ​

Cakes and desserts​: A 'satisfactory' year​

The cakes and desserts business had a “satisfactory year in a difficult environment”​ dogged by industry overcapacity, raw material inflation and heightened promotional activity.

“The UK ambient cake market grew in volume by 1.6% in the year to October 3 with Greencore growing its volumes by 5.1% in the same period.”​

Chilled sauces and soups, frozen and foodservice desserts​

Sales of chilled sauces and soups were up 15% but growth in frozen Yorkshire puds was thwarted by a fire at the group’s factory in Leeds in the spring.

However, the first of two new replacement ovens has been commissioned with the second scheduled for commissioning by the end of the first quarter of 2011.

Volumes of desserts for the foodservice market were up 6%