Northern Foods passes on fuel costs
Northern Foods, the maker of chilled ready meals sold at Marks & Spencer, said yesterday it planned to pass on £32m of rising commodity and fuel costs to consumers.
Chief executive Stefan Barden said: “We would be expecting to fully recover all the input cost inflation. We have to date and we would intend to do that for the rest of this year.”
Northern Foods, which also makes Fox’s biscuits and Goodfella’s pizza, said its average selling price increased by 5.5 per cent in the 13 weeks to June 28 and Barden said he expects that level of increase to continue.
Northern Foods gets around 25 per cent of its sales from Marks & Spencer, which reported a slump in food sales earlier this month and is known to be reviewing its terms with suppliers.
Meanwhile, Compass, the world’s largest caterer, shrugged off the impact of soaring food prices and put out a strong third quarter trading statement yesterday.
The firm said organic sales growth was around 5 per cent. It added that margins are rising at a similar rate to the first half of the year, about a 60- basis points improvement.
Compass said it continued to mitigate the impact of higher food costs by better menu planning and tighter staff scheduling, and that it would now turn its focus to cutting unit overheads.
A Compass spokesman said: “There’s been a lot of structural change. Most of the restructuring in the UK is coming to an end now.”
