ICELAND boss Richard Walker has called on ministers to issue more support for businesses struggling with sky-high energy bills.

Without a price cap on businesses' energy bills, many smaller firms would surely collapse, the supermarket's managing director told City A.M.

An absence of further support for businesses was "really serious" as the colder months approach, Walker said.

"There's a lot of different things they can do," Walker said. "If they don't, it will mean bankruptcy, job losses and further price rises for consumers."

The frozen food giant has itself experienced its energy costs going "through the roof" in recent months, its boss added.

"There's not much we can do, that's the reality," he said. "It's very, very challenging."

In a note to investors yesterday evening, Moody's downgraded Iceland to B3 from B2, with the outlook on all ratings changed to negative from stable.

Moody's said it anticipated the retailer's electricity bill would more than double in fiscal 2023, ending March, compared to the prior year.

This would reduce Iceland's ebitda and cause leverage to increase more than previously anticipated.

Iceland has teamed up with upstart energy supplier Utilita with a roadshow to educate consumers on the most energy-efficient ways of cooking food and changes to packaging.

Depleted harvests in Europe, as war wages on between Ukraine and Russia, would result in "a lot of constrained supply" of food over the next few months, Walker predicted.

Reduced fruit and vegetables would lead to prices increasing, meaning a trend towards frozen produce. "Maybe even frozen pasta," he added.

(c) 2022 City A.M., source Newspaper