Northern Foods "Well Placed" For M&S Branded Product Move

by Hannah Benjamin - 09/11/2009

"Frozen foods company Northern Foods PLC (NFDS.LN) Thursday said it is "well placed" to deal with key customer Marks & Spencer Group PLC's (MKS.LN) decision to start stocking branded products."

The company supplies food including sandwiches, biscuits and ready meals to U.K. food, clothing and houseware retailer Marks & Spencer, which this week broke with half a century of tradition by announcing it would start selling branded products including Coca Cola in all of its stores from next year.

However, Northern Foods spokesman Andrew Hanson told Dow Jones Newswires Thursday: "While we wouldn't discuss specific retailer relationships, we are both a private label and branded manufacturer so we're well placed."

He added: "Our existing private label categories for M&S are important so we wouldn't see any reason for that to change."

Two consumer goods analysts Thursday said they didn't think the shift in Marks & Spencer's product mix to include brands would materially hurt Northern Foods.

"Some of the main products Northern Foods supplies to Marks & Spencer include Christmas puddings, sandwiches and ready meals, which aren't really areas where there's much branded competition," one said.

Another said: "There could be a slight impact on biscuits but what's probably more important for Northern Foods is for Marks & Spencer to be a successful retailer getting footfall up."

Northern Foods, which updates on trading next week, last month posted slowing comparable sales growth.

More Details: http://online.wsj.com/article/BT-CO-20091105-716167.html