Convenience food manufacturer Greencore said its sales of food-to-go products, such as sandwiches, salads, sushi and chilled snacks, have collapsed 70% as a result of the COVID-19 lockdown in the UK and Ireland.

Greencore is the largest sandwich maker in the UK and Ireland. Sales of food-to-go products typically account for about two-thirds of the group’s turnover.

Greencore said its sales are currently down 40% on where they were last year as a result of the collapse in sales.

In response to the crisis, Greencore said it had temporarily closed three of its manufacturing plants and had reduced production at a fourth plant.

The company said it had also furloughed a "substantial proportion" of its employees under the UK government’s job retention scheme. Greencore is one of the largest buyers of Irish meat and other food ingredients for its range of sandwiches and ready meals.

Profits

For the first six months of its 2020 financial year up to the end of March, Greencore said its sales increased slightly by 1.6% to just under £713m (€800m).

However, operating profits for the first half of the year are down 14% to just over £38m (€42.5m) as operating profit margins narrowed from 6.4% in 2019 to 5.4% this year.

While sales in the first half of its financial year were positive, Greencore said its sales in April and the first two weeks in May had fallen dramatically.

The company said COVID-19 has had a “dramatic and volatile” impact on the share of UK food consumption, although there are signs that demand patterns are stabilising.

Greencore said maintaining liquidity was now a priority and has almost £268m (€300m) in undrawn banking facilities to support cashflow.

“We have implemented a broad range of actions to mitigate the impact of COVID-19 on our business and to position us for growth as the pandemic eases,” said Greencore chief executive Patrick Coveney.

Shares in Greencore fell 6% in early trading on Tuesday to £1.42.