Revenue has fallen 2.1% in Finsbury Food Group’s continuing UK operations, with the manufacturer still under pressure from cost inflation.
The Group, which sold its Free From business to Genius Foods in February last year, saw first half sales drop to £86.6m, for the six months to 28 December 2013.
Meanwhile its 50% owned joint venture business, Lightbody Europe, saw flat year-on-year sales. Finsbury said cost inflation in key ingredients, such as butter and chocolate, combined with general cost inflation have continued to put press on margins.
However it was keen to point out that it had been investing in the business to try and mitigate the effect of cost pressures.
"The planned cake capital investment programme is progressing well with the new cake slice ‘snap pack’ packaging format launched and further snacking cake automation investment on track for year end completion," said Finsbury in its pre-close statement, today (24 January).
The expansion of its Nicholas and Harris bread facility has also been commissioned, this month.
John Duffy, chief executive of Finsbury Food Group, said: "Whilst the trading environment remains tough in the short term, in line with our stated strategy, our low level of debt and interest cost allows us to make significant investment in our factories and businesses for the future.
"In a transitional year following the sale of the fast growing Free From division and consequent group restructuring and capital investment, I am pleased with the progress made and believe we will enter next fiscal in a stronger position for the eventual improvement in consumer market behaviour ahead."