The owner of brands including Hovis, Mr Kipling and Bisto today (Thursday) updated the City on its financial performance, saying it was "making good progress on our stated strategic objectives" in a "challenging trading environment".
Commenting on its proposed offloading of its Quorn business, the company said: "We are open-minded about disposals if they can accelerate our deleveraging and contribute to shareholder value."
It added that "we are in discussions with a number of parties with a view to selling our meat-free business. These discussions are continuing and we will make an announcement as and when appropriate."
The group, which has a large debt pile, is considering the future of its portfolio of assets.
Premier Foods said that total group sales were down 4.2% to £606m in the three months to 30 September 2010, which it attributed to a fall in non-branded sales.
Grocery sales of Hovis, one of its flagship brands fell 7.7% on the year to £170m. Tesco opted to delist Hovis and a number of Premier lines because of a pricing disagreement.
The group, however, said Hovis continued to "progress", buoyed by sales of its new Hearty Oats loaf.
According to one source, it is thought that Premier Foods and Tesco are close to reaching an agreement on getting the lines relisted.
In its update to the City, Robert Schofield, Premier Foods chief executive, said: "Following constructive discussions with leading retailers, we have completed our repricing, in both grocery and Hovis to recover the sharp rise in wheat prices.
"Our grocery, Hovis, and meat-free businesses are trading well, taking market share and we expect each to match or increase trading profit for the year. Profit in our non-branded chilled business, however, will be lower given competitive pressures and higher input costs."
Other highlights of its performance, according to Premier Foods, were Hartley’s and Loyd Grossman, which it attributed to the introduction of new products and promotional activity.
Tesco was unavaialble for comment.