Associated British Foods (ABF), parent company of bakery brand Kingsmill, has warned that earnings per share will be lower than expected for its half year results, due out in April.
The group said it expected "some progress" in adjusted operating profit for the six months to 27 February, but said adjusted earnings per share would come in slightly lower.
However the outlook for the full year is unchanged.
Net debt is expected to be some £0.4bn, substantially lower than at the same time last year reflecting good cash management in this year’s first half and strong cash generation in the second half of last year.
ABF said: “The UK bakery market remains intensely competitive with retailers choosing bread as a means of highlighting their value for money to shoppers.
“Although average prices have been stable for the last six months, they remain at their lowest level for eight years. Kingsmill’s market share grew, with a substantial increase in sales volumes, although bakery margins as a whole remain under pressure.”
The company added that AB Sugar had ‘performed steadily in the first half’ and said that within its ingredients division that revenues in the first half are expected to be ahead of last year at constant currency but a little lower at actual exchange rates.