Turnover increased for Finsbury Food by 50 per cent to £109.8m (€158m) for the year ended 30 June 2007, aided by the demand for premium foods, the company said today.
In its preliminary results, UK-based cake and artisan bread maker Finsbury said operating profit increased 95 per cent to £5.4m (€7.8m), from £2.8m (€4m) the previous year. "One of the key factors in our success over the last few years has been our clear strategy to focus on the premium end of the markets," said Finsbury's chief executive Dave Brooks. "We opened the year with annualised sales of around £90m and our annualised sales for the year to June 2008 are now forecast to exceed £150m, which makes us the number two player in the UK cake industry." However, the company said its bakery businesses had suffered under rising input costs. "It has not been the easiest of years for the bakery sector with rising input costs and the challenge of passing these costs on to customers. In the bakery markets in which we operate, we have seen a number of business failures and it can be expected that there may be more," the company said.
Finsbury claims the 'every-day' bakery sector is suffering more than the premium sector as consumers are willing to pay more for the products. "Our challenge is to develop our market sectors efficiently so that we can mitigate the impact of rising costs within our business. We continue to work with our customers to pass these increases on where appropriate and to use our innovation skills to minimise their impact." The company said turnover had increased in its cake businesses, with Memory Lane Cakes up 11 per cent, and up 28 per cent for the Scottish cake businesses California Cakes and Campbells Cakes. Finsbury said Campbells Cakes supplies over 90 per cent of the UK low-fat cake slice market and the business has also developed a range of premium cakes to take advantage of the growing trends within these segments.
"This move towards premium has enabled us to almost treble the size of this business since it was purchased," the company said. Following a fire within the United Central Bakeries business in 2006, the company had to invest £2.6m this financial year, although claims its gluten free business continued to grow during the reconstruction. "We have a continued investment programme in this market with new products due for launch over the course of the next few months," Finsbury said. The company said the UCB business is now operational in the manufacturing of potato cakes and yum-yums.
Finsbury acquired Lightbody in February this year, manufacturing celebration cakes, and now holds a 50 per cent market share in this market. The company said the integration was successful, including the re-location of its California Cakes business into one of the Lightbody sites in July 2007.
"This was one of the key post acquisition deliverables and I am pleased to report the successful completion of this project," the company added.