Sardus said yesterday (16 January) that it was anticipating lower full year profits than previously forecast.

"The preliminary calculations of earnings for 2005 indicates that pretax profit, before any nonrecurring expenses such as the write-down of property in connection with the closure of ham production in Hultsfred and allocations to reserves in conjunction with the forthcoming change of company president, will total approximately SEK75m (US$9.7m)," the Swedish producer of sandwich toppings and supplier of frozen foods said in a statement.

The figure is a fall from the SEK123m pre-tax profit achieved last year and down on the forecast presented in October, when predicted earnings were in the range of SEK100m.

The decrease in earnings has occurred during the month of December, since a number of the group's units developed less favourably than the forecast and compared with the previous year, the company said.

"Christmas sales were poorer than expected as well as lower than in the preceding year. There is no reason to believe that the decrease in sales is anything other than temporary. However, margins have fallen in 2005 due to increased price competition in the market," said the president of Sardus, Ragnar Bringert.

In the past year, a number of measures have been taken to reduce costs and strengthen profitability. Further measures are planned to create the conditions for improved earnings in 2006, a statement said.

The year-end report, with a complete analysis of the development of Sardus, will be presented as planned on January 31, 2006.