Baxters Food Group, the UK soup-to-sauces maker, has revealed it is "highly likely" to make an overseas acquisition this year.

The company, which last year bought CanGro's soup operations in Canada, is again ready to get out the chequebook for a business overseas.

Baxters forecast a third of its returns coming from overseas markets by the end of its 2007/08 financial year and the company said it planned to step up its investment in its Canadian businesses.

In the 53 weeks to 2 June 2007, Baxters saw operating profit rise 6.5% to GBP7.5m (US$15m) on the back of a 3.6% increase in turnover to GBP114m.

In its filing to Companies House, Baxters said the results reflected "solid core growth" and gains from improved efficiency.

The company, however, warned of raw material inflation and growing competition.