Bread volumes at Allied Bakeries are to be hit in the coming year following price discussions with customers.
Parent company Associated British Foods (ABF) said work was continuing to reduce operating losses at the Kingsmill and Allinson’s owner, which were last year described as “unacceptable”.
In a trading update ahead of a close period, ABF stated: “Some bread sales volume will be lost next year as a result of recent customer discussions on pricing.
“We remain focused on reducing these losses and will take further measures to this end as needed.”
The company told British Baker it could not comment further on the issue because of commercial confidentiality.
ABF also reported that revenue from its ingredients division was expected to be ahead of last year, with progress in operating profit.
It said trading performance in AB Mauri bakery ingredients in Europe, the Middle East and Africa (EMEA) benefited from the integration of Holgran and Fleming Howden following their acquisition from Rank Hovis last year. The company added that protein crisps had continued to drive revenue growth at ABF Ingredients.
ABF said it expected sugar revenue from continuing operations to be lower than last year in the first half, with lower EU contracted sugar prices affecting its UK and Spanish businesses.
The company is scheduled to announce its interim results for the 24 weeks to 2 March on 24 April 2019.