Nomad Foods Limited has reported a 10.5% increase in sales to €683 million and a profit of €47 million for the first quarter of 2020 compared to Q1 2019.
“First quarter revenues and earnings were significantly ahead of our expectations due to the unprecedented level of consumer demand for frozen food driven by the Covid19 pandemic,” said CEO Stéfan Descheemaeker. “This change in consumer behavior, which began in early March, has continued into the second quarter with in-home consumption the most meaningful driver. Our organization has collectively risen to the challenge by ensuring the continuous supply of our products and brands throughout this crisis while prioritizing the health and safety of our employees.”
Organic revenue growth of 7.7% was logged during the three-month period ending on March 31 reflected a 6.3% increase in volume/mix and a 1.4% gain. Reported profit was €47 million, while adjusted EBITDA of €120 million and adjusted earnings per share was €0.33 (down 18%). Reported EPS increased 77% to €0.23.
The Feltham, England-headquartered company’s portfolio of household name retail ready meals, fish, vegetable, pizza and other brands sold in the United Kingdom and across continental Europe include Birds Eye, Iglo, Findus, Goodfella’s and Aunt Bessie’s. Trading on the New York Stock Exchange as NOMD, shares were priced at $21.00 shortly before 11 AM on May 8, up 1.69% over the previous day close and above the 12-month high of $20.86.
Noam Gottesman, Nomad Foods’ co-chairman and founder, commented: “As Europe’s leading frozen food company, we are honored and humbled to serve our communities during this time of need. Our business model and supply chain are demonstrating extreme resilience as we all adapt to the current situation. As consumers eat more meals at home and gravitate towards brands they trust, we are addressing a growing need for quality, convenient, and reliable products. In addition, our financial and liquidity profiles have never been stronger, providing the flexibility to opportunistically repurchase shares during the first quarter of 2020.”
Martin E. Franklin, co-chairman and founder, added: “Nomad Foods has distinguished itself as a leader in the packaged foods sector with 13 consecutive quarters of organic revenue growth. Further, as a frozen food pure play, our company is uniquely positioned to service the extraordinary demand for food at home throughout this crisis. We are proud of the team’s effort and execution, especially these past few months, and are confident that we will emerge from this pandemic with an even stronger commercial foundation.”
Brighter 2020 Guidance
The company is raising 2020 guidance and now expects Adjusted EBITDA of approximately €450 to €460 million versus the prior expectation of €440 to €445 million. Adjusted EPS is now forecast to range from €1.24 to €1.27 per share versus the prior expectation of approximately €1.19 to €1.21, reflecting a higher Adjusted EBITDA outlook and a lower share count as a result of recent share repurchase activity. Full year guidance now assumes organic revenue growth at a mid-single digit percentage range versus the prior expectation of low-single digit organic revenue growth.