Finsbury Food Group – which also produces Mary Berry-branded cakes – saw record sales in the last six months of 2021, with revenue of £166.5 million, up 9% on the year before and fuelled primarily by growth in supermarkets and overseas.
However, higher costs due to ongoing labour shortages and supply chain disruption meant that pre-tax profits for the UK arm of the business dropped by 27%, coming in at just £5.7 million for the same period. This was down from £7.4 million in the last six months of 2020.
The business plans to recover profitability in the coming months by increasing prices and passing higher costs onto customers.
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“We have not been immune to the challenges arising from sudden and unexpected input cost inflation over the period,” said chief executive John Duffy.
“However, we have been able to mitigate the impact of these pressures through commercial negotiation and operational improvements and will see the benefit of these actions in our second half profit performance.”
He added: “We have also been affected by staff shortages and supply chain disruption and would have been able to supply extra demand for our products and deliver further revenue growth had it not been for these external factors; a positive sign for the future of our business as these issues begin to ease.”
The business confirmed its full year performance would remain in line with market expectations.
The group also announced it had increased its stake in its French distribution subsidiary Lightbody-Stretz, taking it from from 50% to 85% of the total, with an option to buy the remaining 15% after two years.
“The company considers that securing a majority stake in this business will enhance its capacity to support the business and deliver growth outside of its primary UK markets,” Duffy added.
“The board is eager to grow the group both in the UK and in Europe and will look to meaningful acquisition to achieve its objectives.”
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