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Premier Foods serves dividend after 13 years as home chefs cook up a storm

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·2-min read
An illustration of a Mr Kipling Cherry Bakewell
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By Yadarisa Shabong

(Reuters) -Premier Foods on Wednesday restored its dividend after 13 years as more consumers used its Oxo stock cubes and Bisto gravy while cooking at home during lockdowns, helping its annual revenue and profit beat market expectations.

The Mr Kipling owner also announced plans to launch a vegan range of Sharwood's Indian cooking sauces and 30%-less-fat Loyd Grossman lasagne sauces, as it expands in the increasingly popular healthier choices category.

Shares of the British food company rose 3% by 0843 GMT.

Premier Foods said it is confident of delivering on profit expectations this fiscal year, after an increase in home cooking during COVID-19 curbs helped sales in its online business more than double last year.

Its international division logged a 23% growth in revenue.

However, top boss Alex Whitehouse told reporters it was too early to read how the reopening of economies in several of its markets would impact demand.

Britain this week allowed more businesses to function, with indoor pubs reopening their doors for drinks and meals and cinemas screening again after the strictest restrictions in peacetime history.

Premier Foods reported a 24% jump in adjusted pretax profit to 115.3 million pounds ($163.48 million) on revenue of 934.2 million pounds for the year ended April.

Analysts had expected group adjusted pretax profit of 112 million pounds on revenue of 926 million pounds, according to a company-compiled consensus of estimates.

The company reinstated a dividend of 1 pence a share and issued a new five-year 300 million pounds note to refinance its debt.

"Set against a troubled decade, FY2021 has been positively transformational for Premier Foods as management continued to harvest the benefits of focus, simplification and careful, nay constrained, brand development," Shore Capital analysts said.

($1 = 0.7053 pounds)

(Reporting by Yadarisa Shabong in Bengaluru; Editing by Devika Syamnath)

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