Premier Foods full year sales up

By Rhys Jones

LONDON (Reuters) - Premier Foods, the country's biggest food maker, on Tuesday said annual sales would be 9 percent higher and that it was reviewing a range of options to ease its 1.8 billion pound debt burden.

The maker of Hovis bread, Mr Kipling cakes and Bisto gravy, said it had arranged a 60 million pound working capital facility to provide additional headroom for the first quarter of 2009.

"The review of our capital structure is progressing well, discussions with stakeholders are constructive and we will provide a further update with our preliminary results," the company said in a trading update for the year ending in December 2008.

Premier said second-half sales were 10 percent higher after strong trading across a number of grocery categories, with volume growth in both branded and retailer-branded products.

The group said it expected its full-year adjusted profit before tax to be between 185 million pounds and 190 million pounds.

In the previous year the company made a pretax profit of 170 million pounds.

Analysts had expected the company to post pretax profit of 200 million pounds for calendar 2008, the average forecast on Reuters Estimates shows.

Premier, whose shares plunged 90 percent last year on concerns over its ability to repay its debt, said it would provide a further update on the review of its capital structure with its preliminary results.

Premier's debt was built up following the acquisition of Campbell Soup Co's UK and Irish operations in 2006 and bakery group RHM the following year. It stood at 1.78 billion pounds at the end of 2008.