Premier Foods lifts capex after profit growth

Premier Foods has increased capital investment to £52m after reporting higher full-year revenue, stronger trading profit, and reduced debt across the business.

For the 52 weeks ended 28 March 2026, the UK manufacturer reported revenue of £1.175bn, up 2.5%. Trading profit rose 6.7% to £200.4m, while profit before tax increased 12.8%. Net debt fell by £48.4m year on year to £95.2m, reducing leverage to 0.4 times compared with EBITA.

With lower leverage giving the group more room to invest, capital expenditure rose by 25% during the year to £52m. Projects included new boilers at the Worksop site and a solar farm at the Carlton cake site in South Yorkshire, where the installation can provide up to 70% of the site’s electricity requirements.

Premier Foods owns brands including Mr Kipling, Ambrosia, Batchelors, Sharwood’s, Oxo, Bisto, and Fuel10K, giving the group a broad operating base across ambient grocery, sweet treats, meals, sauces, desserts, and breakfast formats. Across that portfolio, investment is being directed not only at output growth but at energy performance, site resilience, and production efficiency.

Sweet treats remained a key contributor, with revenue up 7.3% and ten consecutive quarters of growth. Mr Kipling products, including cake bite tubs and breakfast formats, were among the drivers, alongside the group’s wider focus on branded products. Branded revenue increased 3.4% overall and accounted for 88.6% of total revenue, while non-branded revenue declined after contract exits and the closure of the Charnwood site.

In mature UK categories, growth increasingly depends on whether manufacturers can fund plant efficiency and product innovation while absorbing cost pressure. Premier Foods’ stronger cash generation has created space for infrastructure projects that reduce exposure to energy volatility and support more reliable production. New boilers and on-site solar generation are not peripheral investments; they shape manufacturing cost, emissions performance, and operational control.

Energy remains one of the most important variables in food production. Heat, steam, baking, chilled storage, compressed air, and refrigeration systems all carry significant cost and emissions exposure. Energy projects can rarely remove price risk entirely, but they can improve planning certainty and reduce dependence on external supply at high-volume sites.

That same pressure has been visible in wider plant-optimisation work, including Rockwell and Actemium’s AI-led refrigeration energy project, where frozen food refrigeration was targeted through digital monitoring and control. Across the sector, utilities are being treated less as background infrastructure and more as active production assets.

The UK food manufacturing environment remains uneven. The Food and Drink Federation has urged government support for the £42bn food manufacturing sector as costs and insolvencies rise, reflecting the pressure still facing smaller and more exposed operators. Premier Foods’ results sit on the stronger side of that divide, showing how scale, brands, and balance sheet control can create reinvestment capacity.

Portfolio complexity is also shaping the investment requirement. Health-led growth, breakfast formats, portion-controlled cakes, premium meal solutions, and acquired brands such as Merchant Gourmet and Fuel10K all place demands on manufacturing systems. Factories need to support innovation without adding disproportionate scheduling, changeover, packaging, or labour costs.

For Premier Foods, the next phase of growth depends on keeping that balance intact. Branded momentum gives the group pricing power and commercial visibility, but factory performance will determine how much of that value is retained. In a sector where cost shocks remain difficult to predict, capital investment is becoming one of the clearest dividing lines between manufacturers that can adapt and those forced into short-term defence.