Northern Foods says lack of promotions impacted sales

Northern Foods, owners of Goodfellas and Fox’s Biscuits, has reported a 1.6% fall in like-for-like sales for the past three months, which it blames on reductions in promotional activities.

Vinnie

The company says the first-quarter drop was “as a result of our planned reduction in promotional activity… and the decision to pull out of low-margin contracts as well as the end of a contract with Birds Eye.”

Only its chilled food unit, which produces food for retailers such as Tesco and Marks & Spencer, saw an increase in sales by 14.3%.

The group says it will continue to invest in its Goodfella’s pizza brand, which it recently announced would be repositioned, and predicted that the automation of its Fox’s Biscuits production facility would boost first-half earnings.

Northern’s chief executive, Stefan Barden, said he expected “to see continued challenging trading conditions. We are focused on a range of initiatives to enhance the competitive position of the group and to drive growth, with increased investment in brands, talent and technology in the first half-year. Northern Foods remains well positioned going forward.”

Fox’s has recently relaunched its Vinnie the Panda ad due to “popular demand” and said it “will be at the forefront of the multi-million pound marketing investment that Fox’s is making across its broad portfolio of biscuits over the course of 2010.”

When it first ran, Fox’s said it helped to buoy Northern Foods full-year results, which increased 3.9% rise.

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