Finsbury Food warns of increasing prices as sales soar
Profit dipped due to high inflation, the business said.
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Your support makes all the difference.The manufacturer behind Weight Watchers branded cakes has said it saw record sales in the last six months of the year, but warned that prices are increasing for customers.
Finsbury Food Group, which also makes the Mary Berry cakes that are sold in supermarkets, said that revenue hit £166.5 million, up 9% on the year before.
But as the company faced higher costs, pre-tax profit dipped, from £7.4 million in the six months to the end of 2020, to £5.7 million a year later.
The business thinks it will be able to mitigate this in the coming months, by passing the new costs onto customers.
“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 said that its results for the full year will be in line with what analysts expect. However its shares fell slightly after the announcement on Monday morning.
It also announced that it would increase its holding in its French subsidiary to 85% of the total.
The announcement “reflects our continued desire to invest behind our European growth and is underpinned by the company’s proven ability to create value through acquisition,” Mr Duffy said.
“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.”