Premier Foods ‘probably a zombie company’: City
It was a busy year for Premier Foods, hitting the headlines with everything from strikes, factory closures and mergers and disposals to management changes and rumours surrounding its strategy for ridding itself of its heavy debt.
And it is the latter that features on our list.
The debt-laden food manufacturer was described as a “zombie company” in March by analyst Panmure Gordon.
Its executive director Graham Jones said: “If a zombie company is defined as one that can afford to pay its interest and pension liabilities, but is not able to reduce high levels of debt, then we think at the moment Premier probably meets that definition.”
Despite disposal proceeds now totalling £370M, Panmure Gordon forecast net debt/earnings before interest, tax, depreciation and amortisation (EBITDA) of 4.9x for this year.
Meanwhile, Premier Foods gained better headlines later in the year when it won three Food Manufacturing Excellence Awards, including the coveted Company of the year title.