Zetar, the UK confectioner and snack maker, has reported a 2% increase in annual revenues thanks to growing confectionery sales.

The company, which makes own-label products for UK supermarkets, as well as chocolates and snacks under licence, said turnover was up 2.2% to GBP135m (US$218.5m) in the year to 30 April.

Confectionery sales increased 4% to GBP86m, which helped to offset flat snacks sales. Revenues from snacks reached GBP49m, the same level of a year earlier.

Zetar, which owns brands including Lir chocolates, said an improved product mix, with sales of branded and private-label products up 10%, helped maintain annual operating margins.

The company said it was “pleased” with its margin result, given “significant input price inflation”.

Margins from its snacks business, which has been affected by an increase in commodity costs, have improved since the first half of Zetar’s financial year, the company said.

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However, with margins from snacks below “historic norms”, Zetar said it had ended some “commodity-based” contracts. The company said it was unable to increase prices that generated an “acceptable” margin.

Looking ahead, chief executive Ian Blackburn added: “The confectionery division is positioned to grow further this year and the snack division’s recovery is set to continue as it builds its portfolio of branded fruit and nut snacks.”

Shares in Zetar were up 0.49% at 203.5p at 10:24 BST this morning. The company will publish its full annual results on 20 July.