UK baked goods group Finsbury Food Group has posted a leap in annual profits, buoyed by growing demand for premium products and its recent acquisition of celebration cake firm Lightbody.
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The company saw operating profit almost double, leaping 95% to GBP5.4m (US$10.8m). Sales for the year to the end of June jumped 50% to GBP109.8m.
“I am delighted to be delivering a record set of results for the group,” said CEO Dave Brooks.
Brooks attributed the company’s strong growth in recent years to its strategy of focusing on the premium end of its markets. “This is where our innovation, consistent quality and service levels can add the most value to our customers,” Brooks said.
Finsbury acquired Scottish baker Lightbody for GBP37.5m in February, and said the business had contributed GBP18.8m to group sales for the year, performing ahead of initial expectations.
The company also reported significant organic sales growth in all of its core businesses, with an 11% increase at Memory Lane Cakes, a 17% increase at Nicholas & Harris and a combined 28% across its California Cake and Campbells Cake subsidiaries.
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By GlobalDataFinsbury said the first ten weeks of the new financial year had seen a continuation of the upward sales trend but that rates of growth would slow during the year owing to stronger comparables. However, the company said it expected its focus on premium and health-conscious segments to allow it to grow ahead of the market.
While dairy and flour costs had increased, Finsbury said it had a “constructive dialogue” with its customers which had allowed it to pass on the majority of these costs through higher selling prices. “The commodity raw material markets remain unstable and we will continue to work with our customers to adjust selling prices as those markets move,” Finsbury said.
