PREMIER FOODS, the company behind Hovis bread and Mr Kipling’s cakes, has appointed Alastair Murray, the finance director of Dairy Crest, as its new chief financial officer.
Murray is set to join the food group at the end September in the midst of a restructuring and cost cutting programme as it grapples with a £300m pensions deficit and £900m debt pile.
He replaces Mark Moran, who is leaving Premier after feeling unable to commit to at least the next three years to continue its transition, the company said.
Shares in the company have more than doubled since the beginning of July, following strong half-year results in which it reported a 50% rise in underlying trading profit to £47.4m – which excludes restructuring costs and interest on its debt -a £72.1m reduction in its pension deficit, and cut net debt to £890m from £951m.
During the six months to 30 June, sales slipped 13% year-on-year to £742.2, while it recorded a £23.5m pre-tax loss, down from a loss of £45.8m it recorded in the same period last year.
The restructuring programme has seen the business cut costs by £20m – with a further £10m earmarked – and dispose of its sweet pickles and table sauces business for gross proceeds of £92.5m, the net proceeds of which were used to pay down debt.
However, Graham Jones, analyst at Panmure Gordon, told The Telegraph that Premier’s debt and pension liabilities will remain a “key issue” and predicted that the business will eventually launch a rights issue worth around £200m to support its balance sheet.
Murray should be well-placed to continue the turnaround at Premier. During his ten-year tenure at Dairy Crest, which owns brands such Cathedral City and Clover, he helped lead a significant restructuring to simplify the business and creatively address its pension deficit.
His experience spans a 30 year career including roles as group finance director of The Body Shop International, and earlier with Dalgety and 13 years with Unilever. He is a CIMA fellow.
Commenting on the changes, Gavin Darby, Premier chief executive, said: “Alastair is an excellent addition to the team. His extensive strategic, commercial, financial and consumer branded experience will be invaluable as we continue our journey to transform the Company and drive further growth. I’m confident he will hit the ground running.