UK bakery firm Finsbury Food Group has insisted it is optimistic about its growth prospects despite a “tough” consumer environment and continuing cost inflation.
The company, which produces cake, bread and morning goods, today (26 March) announced a 16% increase in revenue for the six months to 31 December. Sales reached GBP87.8m (US$138.8m) driven by a 19% increase in revenue from Finsbury’s cake business and an 8% jump in sales from its free-from and bread division.
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Pre-tax profits increased to GBP2.2m, up from GBP1.9m a year earlier, Finsbury said. The firm saw a “minimal” drop in margins, which dipped to 3.4% from 3.6% last year in the face of significant increases in the cost of raw materials.
Finsbury’s net profit was lower, falling from GBP1.2m to GBP1.1m due to share option charges and pension losses.
Nevertheless, CEO John Duffy said: “We are pleased to be reporting further growth across each of the Finsbury businesses. This is particularly noteworthy considering the pressure we are seeing from high commodity and input price inflation. With this in mind, we are focused on driving both efficiency and productivity to mitigate against the negative margin impact of these pressures, and believe that the measures we are taking will continue to bear fruit.”
Duffy said Finsbury would remain focused on driving growth by investing in the business to reach the company’s next milestone of full-year sales in excess of GBP200m.
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By GlobalDataIn the first eight weeks of the second half of Finsbury’s financial year, trading had been “in line” with expectations, it said. Cake sales have risen 5% and bread and free from sales have gained 16%.
“In line with previous years trends, we expect our profitability to be higher in the second half, partly as a result of higher Easter seasonal sales,” the company said.
