Premier Foods plc

Hello, everyone, and thank you for joining the Premier Foods Q1 Trading Update Analyst Conference Call. My name is Harry, and I will be your operator. All lines are currently in listen-only mode, and there will be an opportunity for Q&A after management's prepared remarks. If you would like to enter the queue for questions, release our star followed by one on your telephone keypad. And I would now like to hand the call over to Premier Foods CEO Alex Whitehouse to begin. Please go ahead.

Thank you very much and good morning everyone. Thanks for joining us for our quarter one trading update call and that covers the 13 weeks up to the 28th of June this year. I'm joined on the call this morning as usual by Duncan Leggett our CFO and I'll start by giving a few headlines on our trading in the quarter and then we'll dive into a few key areas to provide a bit more detail before as usual passing to you for your questions. As a reminder, by the way, we're holding our AGM at midday today, which we'll be hosting at our offices here in St. Alden. So if any shareholders would like to attend and you don't have the details, please do contact Richard Godden in our investing relations for details of how you can attend. So on to the quarter one results then. And firstly, I'm pleased to say that we've grown our brand of sales again in quarter one. And we've also increased our market share. So branded sales were up 1.2%, and that was led by a particularly strong performance in branded sweet treats, which was partially offset by some of our grocery brands, which were held back by the unusual hot weather that we've been having. So overall, our group sales were 0.3% higher than last year. And you may recall, we're also lapping some very strong comps. One of the reminder, grocery branded sales were up 8.6%, and total branded up 7.3% last year. So our market share continued to grow, both volume and value market share. You might also recall that last year we delivered some particularly strong volume share gains as we sharpened some of our promotional price points. So taking further volume share this quarter against that strong comparative was very encouraging. I'm also pleased to say that we're on track at this early stage of the year with our trading profit expectations for the full year unchanged. So let's take a look at some of the progress in this first quarter. But before I do, I'd just like to remind you of our branded growth model, which is at the core of what we do and is the reason why we've been able to deliver such consistent, strong performance over the last six years or so. So firstly, we've got a portfolio of strong brands, which are leaders in their categories, and have got very high household penetration. But we then listen very carefully to our consumers so that we can create solutions and bring to market insightful new products which are based on current consumer needs and trends. And then we support many of our brands with emotionally engaging advertising and impactful marketing campaigns, which, in fact, we're currently evolving to incorporate more digital media and leveraging influencers on some of our brands. And then finally, but very importantly, we work closely with our key retail partners to make sure that we're delivering excellent in-store execution for our brands And it's this brand of growth model that underpins our five pillar growth strategy, where we continue to make strong progress in all the pillars, but I'll come back to that shortly. So let's start with our sweet treats business first, where we've had a really great quarter here with branded sales increasing by 11.4%. And a significant part of that growth has been driven by the quality of the innovation program that we've got in place, which is obviously a key part of our strategy. However, I should point out that the underlying core business also continued to perform very strongly. In terms of some of the examples of new products, I've spoken about our Mr. Kipling signature brownie bites before, and they've been performing very well over the last year or so, tapping into the indulgence consumer trend. And they continue to deliver further growth for this quarter as well. And we've also launched Mr. Kipling lunchbox licensing quarter one, which have been specifically designed to be less than 100 calories so that they can be included in school lunch boxes. And they're also, of course, non-HSS, so not high in fat, salt, sugar. But one of the big highlights of Sweet Treat this quarter has been the success of birthday cake tarts and also strawberry and cream tarts. So these birthday cake tarts have been inspired by a trend that we've seen in the United States of birthday cake, as a flavour, not just as a cake. And we've replicated this with some small tarts, which have done incredibly well since we launched them a few months ago. And we've also introduced a caramel version of our leading Cadbury Mini Rolls, and that's also performed very well, and that helped our Cadbury sales, as well as Mr Kipling sales, increase by double digits this last quarter. Looking forward to the next quarter and beyond, we just launched Mr Kipling Breakfast Bakes, which contain fibre, And I've got 30% less sugar than similar cakes. And that's the perfect on-the-go solution as we further expand our breakfast offering. And so moving on to the grocery business. So this quarter, our grocery branded sales were 2% lower than the same period a year ago as they lacked some strong comparisons. And also some of our grocery categories were impacted by that warmer, sunnier weather we've been having here in the UK compared to what was actually quite the cool down spring last year. From our experience, there are a few specific categories which can be impacted by warmer or indeed colder weather, and that's things like gravy, stocks and soup, and also dessert, so custard to an extent too. And we tend to see more of an impact in the shoulder seasons, so a warmer spring or autumn can be more impactful, and likewise, a cold spring or autumn has the opposite effect. However, this is very much a short-term factor. We don't see any read across on a medium to long-term basis. And so that everyone's aware, by the way, we're on a journey to de-seasonise the business and reduce the impact of weather. So, for example, we take this into consideration in our M&A strategy. And you can see that both the Spice Taylor and Fuel 10K, which have got little or no weather sensitivity. And also, as we grow our business overseas, this will reduce the impact of short-term UK weather effects. Now, as we look to the second half of the year for our grocery brands, we've got some particularly strong innovation to come, such as Bisto Peri Peri Gravy, which aims to bring more younger consumers into the category, and also the continued rollout of Batchelor's new microwavable ranges, which includes pasta and sauce, and also what we're calling Meals and Minutes. Moving to the non-branded parts of the business, non-branded grocery sales were 9.3% lower in the quarters. We continue to right-size this part of the business and we exited a couple of contracts in custard and salt. However, we also saw consumers switching from our own label desserts into Ambrosia, which is obviously exactly what we want to see. Non-branded sales in sweet treats declined by 5.5%, which was also largely due to some contract exits. And while the nature of these non-branded contracts can mean the business can be quite lumpy on a quarter-to-quarter basis, As we look forward to the second half of the year, we expect non-branded sales for both grocery and sweet treats to start to flatten out. Now, to look more broadly at the progress we've made on our other strategic pillars, it remains very encouraging. So you'll remember that one of those pillars is expanding our brands into new categories in the UK. And I'm pleased to say that we've continued the strong momentum in those new categories with sales up 38% this quarter. This further momentum was again led by Ambrosia Pommage Pots, as it leveraged further distribution gains in both the major multiple retail and large stores, but also now into convenience stores as well. And it now also has five flavour variants in the market too. And perhaps not surprisingly, Pommage Pots has again continued to deliver significant market share gains. As a reminder, and reflecting the success of porridge pots, we're also in the process of laying down some additional capacity for porridge pots at our manufacturing site in Devon. Another key driver of the new category's growth in the quarter was Cape Herbs and Spice, which is really becoming an established presence in the market, as it benefits from increased distribution from the range of what is now 4P retail SKUs. And we've also got a few in fruit service as well. The cake range is extremely versatile. It's great at bringing great flavour to liven up a wide variety of dishes, including poultry, fish, salad and ribs, and also across many midweek evening meals. And also, of course, the barbecue season, which we'll have benefited from over the last few weeks. So growth from new categories also included the expansion of Fuel 10K into mainstream big box cereals with products such as multigrain flakes and multigrain hoops. And these are all protein enriched in line with the rest of the Fuel 10K range. It's early days for this range, but we can already see that they're bringing younger consumers back into the traditional cereals category. And as we look forward to quarter two and beyond, we've got a strong set of plans for new products in new categories. And this includes the launch into the chilled aisle with Fuel 10K yogurt and granola pots. So adding to the breadth of our breakfast offerings. And we're also expanding our Angel Delight ice cream range with what we call handheld twists. And they're in strawberry and vanilla and in butterscotch and chocolate flavors. If we now move on to international, as I've said before, our focus markets are Australasia, North America, and EMEA. And within these target markets, we're currently focused on Mr. Kipling, Sharwoods, and the Spice Taylor Browns. So in the quarter, overseas sales of constant currency grew by 5%. So again, going ahead of our UK core. In Australia, we grew sales double digits with further good progress in cake and cooking sources. And both our cake and cooking source brands continued to perform really well in market, driven by the continued execution of our brand of gross model as we further build on our market leadership positions. You may recall that we've advertised both Mr. Kipling and the Spice Tailor on TV in Australia recently, and we continue to introduce new products to market, as well as maintaining strong relationships with the retailers there. Sales also grew very strongly in Canada as the sales of Mr. Kipling continued to build, partly due to the increased distribution that we gained last year. And in the U.S., we're updating the Mr. Kipling range accentuating the Britishness of the product range with pack designs that include iconic British images such as Big Ben. I've mentioned before, but our research suggests that U.S. consumers believe that British cakes will be of higher quality. And then just as a reminder, our final strategic growth pillar is to look for inorganic opportunities where we can deliver further growth by leveraging the strength of our branded growth model. that was a key principle and we applied when we assessed the fit of both the spice tailor and fuel 10k and both of them increased uk sales in double digits this quarter compared to a year ago the spice tailor has benefited from increased sales from the east asian cooking sauce kits and that we've launched and chinese um cooking sauce kits which we launched going last year so These are authentic product flavors such as Japanese teriyaki, Vietnamese curry, and classic sweet and sour sauce. And now to build on the cuisine extensions, we've just launched into Mexican with our new Mexican kit with flavors such as smoky barbecue fajita and chipotle and lime fajitas. Until 10K had an exceptionally strong quarter, and that was helped by a series of new products we've launched recently. extending the brand into a number of different categories. And all of these are, of course, high in protein, which is a central part of the brand's proposition. These new products include instant noodles, a range of instant soups, and protein bowl pouches. And this very latest product is yogurt and granola pots, which have gone into market just a couple of weeks ago into the chilled aisle. And this is a pot with protein and mixed yogurts. with a lid containing some of our market-leading Fuel 10K granola to sprinkle on top or indeed to mix in. And as we said before, we'll continue to explore further inorganic opportunities where we believe that we can add value by applying our branded growth model. Of course, we've now got greater flexibility in terms of the size of opportunities we can consider, given the strength of our balance sheet. However, and also as we've said before, we are quite picky and we'll update you when we've got anything more that we can share. So in summary, we're on track and our trading profit expectations for this financial year are unchanged. It's particularly pleasing to see the really strong growth in Sweet Treats, which is a strong testament to the value that we're delivering from our branded growth model, albeit partly offset in Q1 by the hot weather impact on some of our grocery categories. And as we look forward to the rest of the year, we expect to see the strong comparative ease and revenue build as we leverage the strength of our branded growth model. And as, of course, we'll be continuing to support our brands and bringing a number of new products to market as well as building further distribution of our brands overseas. And over the medium term, we expect to continue to make strong progress against all five of our strategic growth pillars. So thank you very much for your time. I'll now pass back to the operator and we will be very happy to take your questions.

Thank you. If you would like to ask a question, please dial star followed by one on your telephone keypad now. If you change your mind and would like to exit the queue, please dial star followed by two. And finally, when preparing to ask your question, please ensure that your device is unmuted locally. As a reminder, that is star one to enter the queue for questions. Our first question today will be from the line of Matthew Abraham with Berenberg. Please go ahead. Your line is now open.

Morning, all. Thanks for taking my questions. First question just is in reference to innovation. So you spoke to the success of innovation in Q1. Is it possible to provide some quantification of innovation to come for the remainder of the financial year, whether that's the number of new SKUs and how that compares to the degree of new products that's been launched in the quarter just gone? Thank you.

Hi, thanks, Matthew. Yeah, so, I mean, obviously, innovation is really important to our model, and we know that there is a very strong correlation between long-term ground growth and brands which have got the ability to consistently innovate. And that's why we put so much focus on it, to be honest. In terms of balance to go, I can't quantify it, unfortunately, no. And the reason for that is the way we're increasing our overall innovation output is not by throwing more and more SKUs into the market, because, frankly, there's a bit of room for them on the shelves. It's actually by increasing the overall – revenue potential of the things that we do launch. So this is all about how the marketing team down in the engine room develop ideas working with consumers which have got, frankly, just bigger potential. And when I look at our balance to go this year, I just think we've got a particularly strong and exciting liner for new products, many of which I don't really want to talk about yet because I don't want to give away commercially what we're about to do. But by the time we get to the half year, I'll be able to share more of the things that we're doing. I mean, the one I pull out now that we're quite excited about is the Fuel 10K yogurt pops with the granola on top. But there's lots of things coming across the other categories as well a little bit later in the year. It's just waiting for when the retailers do their shelf relays.

Okay, understood. Thank you. And just one more. So next question, just in reference to margin. With mix changes due to impacts from weather, is there a broader group margin impact from a change in that mix?

Well, we've got slightly different margins on some of the categories, so things can move around a little bit, but you'll note today that we're saying that we're on track for our overall trading profit for the year, so there's no major issue.

Okay. I'll pass it on. Thank you.

The next question today will be from the line of Matthew Webb with Investec. Please go ahead. Your line is open.

Thanks very much. Good morning. First question, can we just start off with that sweet treats, gross number 11.4 for the branded sweet treats. It's clearly a terrific number. Would it be possible to give us a rough breakdown of that between volume, price and mix? And also, if possible, clearly innovation was quite a big, well, I would imagine innovation was quite a big contributor as well. Is it possible to break out the contribution of innovation as well, please, just to sweet treats specifically? That's my first question. Thanks.

I don't have very specific numbers to hand, Matthew, but what I can tell you is that the innovation played a very big role in that growth. But the reason why it was so powerful is because the core grew as well. So we got good growth out of the core and then some really powerful MPD that came on top, hence why you get to such a powerful number. And I think that was coupled with also some really great execution in-store. So we had a big in-store event centered around our partnership with Roald Dahl, and that led to some really big displays in-store at the same time. So really everything coming together and working really well. In terms of volume, price and mix, I don't have the numbers to hand, but what I can tell you is that there is some price in it, definitely, because we increased our prices at the back end of last year. So there's definitely a price component. And from the market share point of view, we took volume share and value share, which probably gives you some indication that this was driven by some of each.

Got it. And then maybe a bigger picture question about the cake category. I guess the perception out there is that it's on the wrong end of some structural changes in consumption, but clearly it was a very strong point for you in the period, and I think you mentioned that the category grew in the period as well. What do you think the median term prospects are for the cake category as a whole and for you within it?

We've always found that the cake category is one of our most elastic categories. And by that I mean it's very sensitive to when we get it right. So if we get the innovation right, we get the execution in store right, we see disproportionate gains compared to some of our other categories. And I think the reason for that is, you know, some of our products are tied to specific meal occasions. So I'm only going to use a pasta sauce if I'm having pasta for dinner. if I'm having something else and I don't need it. Whereas cake is something that you can eat no matter what you're having for dinner and people tend to put them on the countertop at home and they get kind of hoovered up by the family as they go past. So I think when we get it right on cake, we see disproportionately strong performance, which I think is exactly what you've seen here in Q1. So in terms of long-term outlook, we're pretty positive on it, to be honest.

Got it. Thank you. And then final question. The international figure, the growth of 5%, I guess looks maybe a little bit disappointing compared to some of the rates you've posted in the past. Is that a fair reflection of the underlying growth in the period or were there any funnies in there? I know you said that Australia grew double digits, so presumably something else was going the wrong way. What was going on there?

Yeah, sure. So, I mean, we're still really positive on the international growth prospects. We would expect to be in double-digit growth over the full year, although that does feel a little more back-end-weighted for us. In quarter one, yeah, we had some great performance in Australia. We had really strong growth on both of our key categories, cake and also Indian cooking sources, and We took really strong market share gains as well, actually, on both those categories. And Canada continues its, you know, kind of strong build in performance. Where we saw some stuff going in the opposite direction is where we just got, frankly, lumpiness in the supply chain because the business is still actually not that big. And so, consequently, when you're shipping stuff over long distances – the difference between when a container ships and how much stocks in the market can create a bit of a concertina effect. So we'll ship a load of stock, you get a load of stock in market, then there's a bit of a pause when it gets consumed and then we ship some more. And I think that's some of what we saw in the quarter in some markets. And also, I think it's also fair to say we... we've had to change our distributor in the Middle East. So we just have a bit of a period of time where we've not really sold anything in the Middle East while we're exiting one distributor and moving to another. So really both temporary effects, which is why we still expect to be double digit for the full year.

Got it. That's really clear. Thanks very much indeed.

The next question today will be from the line of Corrine Elias with Barclays. Please go ahead. Your line is now open.

Thank you for the presentation and thanks for taking my question. Obviously, your bonds are due in October 2026. Just wondering whether you've got any particular plans to address those and whether the bond market would still be your favourite route for those. Thank you.

Yeah, morning, Corrine. Thanks for the question. Yeah, I think, I mean, you're absolutely right. Bond matures on October 26. I think, as you said, at the year end. we'll be looking to needing to re-validate probably over the next nine, 12 months or so. That very much remains the plan. We continue to monitor the market. I think the bond market has typically worked pretty well for us previously. We've continued to monitor the market and it's a bit of a different position than it was when we put the current bond in place three and a half or ten. So we'll keep an eye on things and probably be able to do something over the next nine or 12 months.

Thank you.

The next question today will be from the line of Andrew Ford with Peel Hunts. Please go ahead. Your line is now open.

Thank you for taking my questions. A couple from me, if I can. Just on the grocery number and the negative number there, can you give a bit more detail on the performance, I guess, how some of the less seasonally relevant products performed versus the ones that you called out in terms of gravy and stocks, etc., that you'd expect to be a bit weaker given the warm weather? And maybe as well, you've obviously become less seasonally dependent as you've grown through your brand building. I wondered how much further you can go given the current portfolio you have or if it would require more of a, I guess, a widening of the categories, reliant on acquisitions, or is there product changes you can make in order to improve that? I'll start with that one and I've got one more if I can.

Morning, Andrew. So, yeah, I mean, within grocery, as I say, there are some categories which, you know, are particularly sensitive to weather. And, you know, this quarter it was for the worse, but some quarters it's for the better, right? So, you know, there would be obvious things like gravy and stock and stuffing because, you know, those categories in what we call flavours and seasonings, you know, if you've got the barbecue out and you're having salads, you know, you're not having a roast dinner so there's an obvious there's an obvious impact there but then we've got you know things that go have continued to march on you know irrespective of that so we have a really strong growth from the spice tailor we have really strong growth from fuel 10k uh breakfast was was really strong because obviously that's not weather sensitive so things like granola um are not weather sensitive at all missing um performed really well with further double digit growth so you know, there were a number of things which were going in the right direction, which are the things, as you would expect, are not weather sensitive. And yeah, so we are significantly less seasonal and weather sensitive than we used to be. And that's for a number of reasons. I think, well, firstly, we've got a more robust business model than we would have had six, seven years ago. You can see that in the strong growth from the cake business, I think. Secondly, the new category entries we've made have tended to be either seasonally neutral or actually seasonally inverse. So I think about things like Cape Herbs and Spice, which delivered more than 60% growth in the course, whereas people sprinkled it on stuff they were putting on the barbecue. And then the brands, as you point out, the brands we bought. So we sort of take this de-seasonalization concept into account on all those things and over time. You know, we're further de-seasonizing the business, you know, at a structural level. I think we've made an awful lot of progress over the last five or six years, which is, you know, why we're still looking at positive branded growth despite the really hot weather that we've just had. And I cast forward, you know, over the next three, five years, we'll keep doing the same. It'll just, you know, make us even more robust. So that's very much the plan. I should also add, by the way, of course, when the weather's cold, it works for us, by the way.

Yeah, absolutely. Thank you. Just one more. Just on the trading up into brands, you made a comment there. Is there, I think there's more in the sweet treat side, but are there any other notable kind of moves into that from non-branded into branded that you're seeing? Anything worth calling out with that trend?

Yeah, I'd pull out desserts as well, where we're seeing, you know, sales moving from non-branded desserts into ambrosia. That's been a trend that's been going on for probably 18 months or so now and has not stopped.

Great. Thank you very much. That's all from me.

That possibly helped, actually, by the way, by the Ambrosia Deluxe launch. So remember, we've got Ambrosia Deluxe we talked about at the full year, which has done incredibly well and continues to do so. And I think that just drags people up in general.

Thank you. As a quick reminder, if you would like to ask any further questions, please dial star followed by one on your telephone keypad now. And the next question will be from the line of Clive Black with Shaw Capital Markets. Please go ahead. Your line is open.

Thank you. And thank you for taking the question, gentlemen. One now I want to start off with. Would it be fair to say that your trading experiences in Ireland mirror those of the UK, given you've got a much broader... assortment in that market. And across the Atlantic, maybe just give us some colour of how things are progressing in Canada, which I think has a little bit more raised profile as your results. And then at a much broader base, perhaps building on Matthew's question, first of all, the UK government has issued updated news on its own food strategy, particularly around HFFS foods. And we've seen a lot or heard a lot of noise about GLP-1s and anti-suppressant drugs in the market, more so stateside than here. But interestingly, recent updates from Domino's and Gregg's have contained some of that story. There's a certain irony in your sweet treats blowing our minds in Q1, but Are you seeing and is your business strategy evolving around appetite suppressant drugs as well to the extent that they're now actually starting to more notably feature in the UK market? Thank you.

That's quite a bit to unpack there. So Ireland, yes, there's a similar, there's almost certainly a similar impact happening in Ireland to in the UK from a weather point of view. but it's not that big for us, to be fair. Relative populations, but yeah. Let's talk about North America for a bit, though. Yes, Canada. We are doing really well in Canada, and I think some of this is we've been there for longer than we've been in sex. It's kind of where it went after Australia. So there's a little bit of a the way we kind of like to think about it is that these markets are following the pattern. So, obviously, we are delighted with where we are in Australia, where we've got leadership in the first two categories, and we're starting to move our elders out now and expand into additional categories, fully established business, team on the ground, you know, running the full grant building model. So, you know, that's the blueprint. But we do need to bear in mind, of course, that it's quite a simple market because it's got two key resales. And then, you know, next cab off the rank was really Canada. So we've been there a little while now and we really have started to pick up momentum, picked up some big chunks of distribution, particularly in Walmart last year. So we've got really good effects of Mr. Kipling in Canada following that initial test. If you remember that fallback, that's when we first tested Cain in America. Yeah. And retail structure is not overly complex. It's not dissimilar in terms of to the UK, really, where you've got a handful of decent-sized retailers. So not like Australia, but also very much not like either. And in the States, we're obviously further behind that. I think in the States and in Europe, we're still in that very early stage where we're just putting our foot in the water and it's a complicated, if not very complicated, retail environment, which I'm sure you're very well aware of. But, you know, there are some interesting things happening in the US. So, Sharwood has been there a little while. It's in limited distribution, but where it is, it's really, really motoring forward. So, we're going to be looking at how we can expand that further. Absolutely. Early days with the Spice Tailor, as you know, we've got one retailer where we're testing that. This seems to be doing pretty well. And then we're about to, I won't go as far as to say relaunch, but we're just about to update the Mr. Kipling position with that Britishness positioning and also launch Apple Pie, which has tested really well. Because interestingly, you might think, crikey, the US has got, you know, is known for its Apple Pies, but actually they're all quite big. And so individuals, you know, six apple pies in a box is something they don't really seem to have. So that, you know, seems to have been something that retailers are quite liking the look of. So we'll see. It's 30 days, but that's sort of the game to have. And there, meanwhile, across the rest of Europe. Sorry?

So I was just going to ask if there's a good segue into the broader GLP diet suppressant angle, big apple pies versus yours.

yeah quite and we are not seeing any impact at this point we're monitoring it really carefully and the work we've done suggests that for the majority of our business so the UK grocery business we're selling things which you use to put together an entire meal so if you've got a family you know you've got a family of four who's making pasta or they're making something that needs an autocube you're not going to use two thirds of the jar or three quarters of the jar because You know, somebody's on P1, and you're not going to use three-quarters of an OXO cube. So we don't think, because of the nature of a lot of our brands, that it's going to make that much difference. The irony is you say it's sweet dreams, when in principle you could imagine there are some people who are going to stop eating cakes, but they're not seeing it. And I suspect some of it might be that – well, some of it might be there's not enough people in the UK that are on it to make much of a difference, but – I think as well, you look at the usage habit of Kipling cakes. It's not, you don't buy one and eat it on the go like you might with a, you know, a confectionery bar. It's bought by the weekly shop. It goes home. It sits on the kitchen countertop and different family members eat them, you know, as they come and go through the kitchen and make a cup of tea. So we think, therefore, that we'll see the consumption from the rest of the families. So as I say, we can't see any impact and I'm not sure we're going to, to be honest.

Very interesting. And then just very quickly, conscious of time, the UK government's evolving rhetoric on diet and health. Is that a continuum for you or something new that we've seen in the last week?

It feels like a continuum, to be honest. I think we've been quite supportive of the health agenda. We see it as both a moral responsibility to help nudge people in the right direction with their eating habits but also as a commercial opportunity because we know a lot of people are trying to be a little healthier and you'll be, I apply, over the last, you know, more than six years now, probably more like eight years or so, we've been, you know, reducing fat, salt and sugar in our products and making healthier options of things so they are available if people want them and we'll continue to do that.

Yeah. I really appreciate the way you embraced the question. Thank you very much.

I think we still need to be aware that we make healthy options of things and stop those people by the original version. But it's there if people want.

Yeah, absolutely. The right way. Thank you.

The next question today will be from the line of Damien McNeill with Deutsche Bank. Please go ahead. Your line is open.

Hi. Morning, everybody. Thanks for taking the questions. A few quick ones from me, I think, hopefully. Just in terms of the market share gains that you've made in the period, are you able to sort of quantify the size of those gains that you've made and where you've taken that share from? I'm assuming quite a bit of it's from private label, but if you could just confirm that, please. On breakfast, you've indicated that you're doing an increasing amount to focus on that eating occasion. I was just wondering whether you could give us an indication of how much of your sales are generated from breakfast at the minute. And then just finally, on marketing spend, I know you don't provide the exact numbers, but I was wondering if you could provide us with some colour on on marketing spend this year. I'm just interested in some of the influences that you are using as well, please. Thank you.

Hi, Moin. So market share gains, we've not shared the exact number on that, but you could probably say it's, yeah, I'll say that it's double digit on both volume and value share gains. double-digit basis points, just to be clear. And I often get asked this, where does the share come from? And it's an interesting one because we don't really look at it like that. We gain market share almost by the consequence of growing faster than the market. So what we intend to do is drive growth and drive growth for the categories, particularly given we tend to have leadership positions in most of our categories. So we will go out of our way to drive growth for us and for the retailer and grow the category. And the fact that we do that, I guess, better than the rest of the category means that there's a mathematical share gain, which is quite different from us going out and actually targeting where that share is going to come from. This is sort of a slightly different approach. As I said earlier, though, we have got categories where we are taking, you know, consumers from private label into brand, and that includes sweet treats and it includes desserts. Does that answer that question?

Yeah, that's perfect. Thank you very much.

Brexit's still relatively small for us. Obviously, our first step into it was with the Ambrosia porridge pots, which continue to do incredibly well and have grown by a huge double-digit number again this quarter. And then since then, we bought Field 10K, which has got a very big proportion of its sales, you know, in breakfast. We've just expanded that with the yogurt and granola pots, which we expect largely to be eaten breakfast or morning time. And also the Fuel 10K big box cereals, which is quite interesting in that we're seeing that bringing younger consumers back into that, you know, big box central part of the cereal category. So, you know, still early days for us, but, you know, big double-digit growth and I'm really pleased with the trajectory that we've got on that. And then finally on your marketing spend question. So, look, the direction of travel here, you know, we've been really clear on is that we are increasing our overall marketing spend over time ahead of inflation with the intent to, you know, scale up how much we're spending behind our brands. We've been doing this for a number of years. at least the last six years, and we plan to spend more this year than we spent last year, and that's part of that journey. And we feel as though we're probably two-thirds of the way along the road from where we were versus where we want to be, if that's any help.

Yes, that's great. Thanks, Alex. And just can you name drop any influencers that you've been using, please?

I couldn't, no, and that's mainly because I'm not that close to it. But there are plenty of people in the team who are.

Yeah, okay. And perhaps just once I've got the mic, just quickly on breakfast, do you think the portfolio of brands that you've got is sufficient to get you to where you want to be in breakfast, or do you think there are still gaps in that part of the portfolio? Yeah.

I think with the brands we've got, we cover a lot of bases. So we can do creaminess with Ambrosia, which is really helpful on things like porridge. And I think, you know, Protein Enriched from Fuel 10K also works with a lot of younger consumers, which is where the growth is, and it's therefore quite exciting. So, you know, we're pretty pleased with what we've got, to be honest.

Okay, brilliant. Thank you very much.

Thanks.

Thank you. And we have no further questions in the queue at this time. So I would now like to hand the call back to Alex Whitehouse for some closing remarks.

Thanks for joining in, everybody, this morning. As you can tell, I think we're pretty confident about the four-year outlook. We're pleased with the overall, I guess, progress across the five pillars of the growth strategy. Sweet treats is in a particularly strong position, but obviously in the short term, grocery being weather-affected, but obviously we know that that's a temporary thing, so it doesn't really knock us off track for the rest of the year or where we're heading strategically, where, as you know, we've got great ambition to scale up Premier Foods using that branded growth model and using the five-pillar growth strategy. Thank you very much.

This concludes the Premier Foods Q1 Trading Update Analyst Conference Call. Thank you all for joining. You may now disconnect your lines.