Finsbury Food’s bakery division sales fall 4%

Total Group sales revenues were £101.5M during the first four months, said the speciality bakery manufacturer of cake, bread and morning goods for both the retail and foodservice channels.

After “very strong growth of recent years”, trading was maintained at those levels into the new financial year and performance was in line with expectation, claimed the manufacturer.

Finsbury said input costs had risen significantly. “Whilst consumer confidence has remained stronger than anticipated, input costs, which are globally priced in dollars or euros, have increased substantially following sterling’s weakness,” it said.

‘Following sterling’s weakness’

“The group has been able to respond to these challenges by modifying promotional activity whilst also reviewing potential opportunities for reformulation changes to minimise the on-cost and maintain affordability of our great products for customers.”

The 36.5% growth of its Overseas division, the group’s 50%-owned European business, was said to demonstrate the strengths of strategic diversification.

Product innovation

Strong cashflow had enabled rising investment in both product innovation and gains in efficiency and productivity throughout the group, said the manufacturer.

“The directors see this as a fundamental part of our long-term competitiveness as well as enabling the group to continue to deal with known headwinds such as sterling induced commodity inflation and the planned National Living Wage increases.”

After the integration of Fletchers and Johnstone’s, its larger, more diversified speciality bakery group was a strong multi-channel business, which was well equipped to deliver growth and improved shareholder value over the coming years, said the board.

Meanwhile, in September Finsbury reported pre­tax profits up by 40% in the 53 weeks to July 2 2016, boosted by acquisitions and strong sales. Operating profit for the company was up 37.7% to £17.1M. Profit before tax climbed by 40.8% to £16M.