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Greencore Group profit before tax down to 48.2 million pounds

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Greencore Group   Adjusted profit before tax was 85.9 million pounds

Food company Greencore Group reported that its fiscal 2016 profit before tax declined to 48.2 million pounds from last year's 59.4 million pounds.

Adjusted profit before tax was 85.9 million pounds, compared to 78 million pounds a year ago.

Group revenue increased 10.6 percent to 1.48 billion pounds from 1.34 billion pounds a year ago. On a like-for-like basis, revenues grew 5.9 percent.

Further, the company proposed final dividend of 4.10 pence per share, giving a total dividend of 6.65 pence per share, up 8.1%.

Looking ahead, the company said, "Given our strong market positions, commercial momentum and new business wins, we are confident that Greencore is well set to achieve further progress in FY17 and beyond."

Separately, Greencore announced the proposed acquisition of Peacock Foods in a deal with enterprise value of $747.5 million or 594.3 million pounds on a debt free and cash free basis.

Illinois -based Peacock is a fast-growing U.S. convenience food manufacturer with strong positions in frozen breakfast sandwiches, kids' chilled meal kits and salad kits. It generated revenues of approximately $1 billion and Adjusted EBITDA of $72.1 million in year to September 2016.

The company noted that the combined business has the potential to transform Greencore's market and channel position in the US and create a strong platform for long term profitable growth.

The deal has compelling strategic rationale, with expected significantly enhanced earnings and targeted return ahead of cost of capital from first full year of ownership.

The deal will be funded by a fully underwritten rights issue offered to qualifying shareholders to raise a total of 439.4 million pounds and new debt facilities of approximately 200 million pounds.

The new US division after the deal closure will be led by the CEO of Greencore's US division, Chris Kirke.

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