Northern Foods has issued a mixed trading update for the first half of its financial year, with underlying sales expected to inch up by 2.6%.

The UK group, maker of brands including Goodfella's pizza and Grassington's meat-free products, this morning (9 October) gave an update on its first-half performance before results are published next month.

Underlying sales from the company's chilled business grew by 5.4% thanks to "strong" growth from its ready meals. Revenue from Northern Foods' bakery business was up 2.8% after biscuit volumes "stabilized", the company said.

However, the outlook is less rosy for the company's frozen business, which saw sales dip 2.6% during the six months to 29 September.

Northern Foods said a "robust" performance from the Goodfella's brand was offset by a "very disappointing" showing from its Dalepak meat grills business.

The company added it expects higher commodity costs during the second half of its financial year. Raw materials costs could grow by up to 10%, Northern Foods said.