Premier Foods Looks to Raise Prices as Pound Falls and Costs Rise

By Tapan Panchal

LONDON--British food manufacturer Premier Foods PLC (PFD.LN) has confirmed that it in talks with customers to raise prices in order to mitigate the impact of higher commodity costs and a weak pound.

"The situation on pricing differs between our different categories and brands and is currently under discussion with our individual retail customers. However, on average we are considering rises around the mid single digit mark," the owner of Mr. Kipling cake and OXO stock cube brands said in an emailed statement received Tuesday.

A spokesman for the company said the price increase would be the last resort and the company is currently looking at other ways to cope with higher costs, including altering promotions and sizes of various products.

Premier Foods, whose major customers include supermarket chains such as Tesco PLC (TSCO.LN), J Sainsbury PLC (SBRY.LN), Wal-Mart Stores Inc. (WMT) unit Asda and Waitrose, is the second major food producer to raise prices, after Unilever PLC (ULVR.LN).

Unilever said in October 2016 that it had asked its top customers for price increases on its products, including Hellmann's mayonnaise, Marmite spread, Dove soap and Ben & Jerry's ice cream. It also cited fall in the value of the pound and higher commodity costs for the price increase.

Shares of Premier Foods at 1055 GMT were trading 1.10% lower at 45 pence each.

Write to Tapan Panchal at [e-mail]

(END) Dow Jones Newswires

January 10, 2017 07:05 ET (12:05 GMT)

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