US bakery, drinks and household products company Sara Lee Corporation announced last week that net sales for its international bakery segment rose 5% to $199m in the second quarter ending 30 December, driven by favorable foreign currency exchange rates.

But volumes in its international bakery business were flat in the quarter, it said. Volume growth in its Australian frozen bakery business was offset by lower unit volumes for its fresh bakery business in Spain.

In the second quarter and first half of fiscal year 2007, the Spanish fresh bakery’s results were negatively impacted by the loss of private label business with a large supermarket chain and competitive pressure from private label in the fresh bread category, said the company.

Sara Lee is focusing on its cost structure and by launching new branded products such as Bimbo White Crust bread, a sliced crustless bread.

Sara Lee said net sales grew in all six of its business segments, with particularly strong growth in North American retail bakery, up 8%, international beverage, up 13%, and household and body care, up 13%.