UK bakery ingredients producer the Real Good Food Company posted a widening first half loss this morning (25 September) and warned that higher fuel and materials costs would weigh on its full year results.
The company posted a pretax loss of GBP1.59m (US$2.96m) for the six months to the end of June, compared to last year’s first half pretax loss of GBP184,000.
Real Good Food said trading had been adversely affected by high fuel, energy and raw materials costs and the negative impact of the EU’s sugar reform.
“These results… reflect a period of difficult trading conditions, when margins have been under competitive pressure and when fuel and energy prices have continued to rise, and look likely to have a consequential effect during the second half, particularly on packaging items,” chairman Pieter Totte cautioned.
Total sales fell 8% year-on-year to GBP104m, the group revealed.
Real Good Food, which supplies sugar, dry ingredients and bakery goods to food manufacturers and retailers, said operating profit at its core sugar division fell to GBP1.8m, down from GBP2.9m last year as sales dropped 10%.
Looking to the full year, the company said pretax profits are expected to total GBP2.2m, some GBP1m below current market expectations.