Investors are warming to microwave meals maker Greencore (GNC) as revenue jumps 17.1% to £417m in the 13 weeks to 30 December due to strong growth in the UK and US.
The convenience foods division has performed well as like-for-like sales over the same period in 2015 are up 8.9% to £401.6m. The shares rise 7.7% to 235.2p in response.
Greencore has reported strong like-for-like growth of 9% in the UK, which is driven by significant growth in its food-to-go business.
In December, the company's acquisition of Peacock Foods was not warmly received by the market. However, investors will be relieved to hear that Peacock is currently performing in line with expectations.
Investec analyst Nicola Mallard is reassured that the business is on track as it management dispels fears concerning growth at Peacock.
Davy Research analyst Cathal Kenny is also upbeat about the firm as it delivers higher revenue despite challenging comparatives and is planning further capacity for its prepared meals segment in the UK.
Greencore warns about expected inflation in raw materials and packaging prices, but plans to tackle this issue through purchasing and pricing initiatives.
