Work on three substantial projects as a result of Greencore's acquisition of Hazlewood Foods last year will have an adverse impact on current trading, the company said yesterday at its annual general meeting.

Shares in the company fell to €2.80 from €3.25 in morning trading on the back of the statement before recovering in the afternoon. The share eventually closed at €3.10.

Addressing shareholders at the meeting, chairman Mr Tony Barry said Greencore's ambient sauces and pickles operations were consolidating two smaller facilities in North Wales and Manchester into its main factory in Yorkshire, while production would be transferred from its existing pizza facilities to its new factory in North Wales. It is also carrying out a rationalisation of its new Hull bakery's cost base.

"While the implementation of these projects will have adverse impact on current trading, their successful completion will be another important step for future growth and profitability," said Mr Barry.

Greencore chief executive Mr David Dilger said he could not say to what extent the projects would affect earnings. "When you're moving, as in the case of ambient sauces, three factories into one with all of the commissioning issues, and training and trialing issues involved, that - and food companies cost money - that's just what's happening," he said.

"I can give the reassurance to the market that we gave to the shareholders at the a.g.m., our plans are on track, we're on schedule, we're happy with our transformation progress in this group. By the second full year after the acquisition, we will have created a lean, mean, hungry growth machine."

Most exceptional provisions in relation to the Hazlewood acquisition were made in the past year, said Mr Dilger. "I don't anticipate very significant exceptional items in the current year," he said.