Hazlewood plays down talk of bid

HAZLEWOOD FOODS, the convenience foods group which makes ready- made meals, sandwiches and cooking sauces for the supermarkets, yesterday played down talk of a possible bid from Unigate while unveiling plans for a major product launch in the spring.

The company has been linked with a possible deal with Unigate, the dairy group which is looking to use its cash pile for an acquisition. But John Simons, Hazlewood's chief executive, said no talks had taken place. "We have plenty of ideas of our own to take the business forward." he said.

Hazlewood plans to launch three new ranges of ready-made meals in the spring in conjunction with its supermarket customers, which include Tesco, Sainsbury's and Asda. Though the company declined to give details, the investment in extra capacity at three plants in Warrington, Wrexham and Bristol will lead to total costs of pounds 2m-pounds 3m being incurred later in the group's final quarter. However Mr Simons said the new launches should add pounds 30m of extra sales next year.

He also denied that weakening consumer confidence would affect sales of high-margin, higher-priced convenience foods. "We have seen no evidence of this. The market is still growing, albeit at a slower rate. Food is one of the last things people cut down on."

He was speaking as Hazlewood reported flat pre-exceptional profits of pounds 19.6m for the six months to September. Like-for-like sales grew by 7.3 per cent on the same period last year.

The grocery division, which includes cooking sauces, was the best performer. Its underlying sales grew by 12 per cent with margins up from 7.2 per cent to 9 per cent. Shares in Hazlewood closed down 10p at 132.5p.