Ingredients supplier Macphie has said its outlook is positive despite weakened sterling and the threat of tariffs.

The Scottish business described its annual results, published last week, as positive given that the business had faced a more challenging backdrop than the previous year.

Annual revenue has risen 3.3% year on year to £55.7m, up from £53.9m in 2017. Meanwhile, gross profit has dropped from 28.4% in 2017 to 25.4%, with operating profit in the year falling to £3.1m from £5.9m the previous year.

“The sector operates with tight margins, as we continue to produce premium products in a highly competitive industry which has seen some well-publicised challenges in the UK casual dining sector,” said CEO Andy Stapley, who has recently joined the business following the departure of Andy Underwood.

“Inflationary pressure in the period combined with volatility in the raw material market – especially dairy products – did present some headwinds.”

Stapley added that investment of more than £5m in technology in the past two years had boosted operational performance and productivity, while insight into consumer trends meant Macphie was well placed to tap developing market opportunities.

“And while the shadow of Brexit creates uncertainty across every industry, with a weakened sterling and the threat of tariffs, our outlook remains positive as we work to secure our supply chain,” he said. “Looking ahead, we are a strong and profitable business that will continue to invest and grow, pursuing new opportunities both here in the UK and overseas.”

Chairman Alastair Macphie commented that, given the challenging environment, the results reflected a balanced and resilient business.

“With the current political landscape giving the UK an uncertain economic outlook, as a business we will continue to monitor developments and act to minimise any adverse impact,” he said.