Festive demand boosts Northern

An expanded range of Christmas puddings and strong sales of sandwiches and salads have helped Northern Foods post solid festive trading figures.

The growing demand for chilled foods and roaring sales of Christmas lines such as Heston Blumenthal’s Hidden Orange Christmas pudding and turkey and cranberry sandwiches meant Northern increased sales 2.3% in the final quarter of 2010.

The group, which makes Fox’s biscuits, also said it had yet to receive a buy-out offer from Harry Ramsden’s owner Ranjit Singh Boparan to rival its proposed merger with sandwich maker Greencore.

Sales at its chilled division were up 9.7% in the quarter, while new lines added to its Matthew Walker own-label Christmas pudding range, including nut-free and chocolate varieties, helped its bakery department post a 5% like-for-like sales increase in the final quarter of 2010.

But its frozen division, which includes its flagging Goodfella’s pizza brand, reported a 17.2% sales slump.

Northern is co-operating with Mr Boparan and has opened its books but said there was no certainty he would make an offer before the January 21 deadline imposed by the Takeover Panel.

Mr Boparan made his name through chicken processor Two Sisters Food Group, but has expanded his empire through acquisition in recent years, snapping up fish and chip group Harry Ramsden’s in January last year after buying the FishWorks restaurant firm out of administration a year earlier.

Northern continues to recommend that its shareholders vote for a merger with Greencore at a meeting on January 31. If approved by shareholders, Northern and Greencore will combine to create Essenta Foods, which will have annual sales of £1.7 billion.

Bringing the two businesses together is expected to save £40 million a year in costs, through better buying power, smaller tax bills and cost cutting. Essenta will be based in Dublin with an operational base in Yorkshire, with nearly all of its 15,000 jobs based in the UK.

Northern, one of the biggest suppliers of own-label products in the UK, makes pies, sandwiches, salads, puddings and ready meals from sites including the Gunstones Bakery near Sheffield and its Fox’s biscuits factory near Preston. Greencore makes own label sandwiches and other chilled convenience food for some of the biggest supermarket chains in the UK.