The company produces fruit and chocolate food gifts, using fruit grown in its orchards, and packages them for gifts. The expansion to the factory in Ohio will build upon the sales growth of these products as well as helping to reduce transportation costs, Harry & David said. "Our Ohio distribution centre is a key activity hub for us; last year we shipped more than 3.6m gifts, which is 1m more than we sent from our Oregon distribution centre," Harry & David's chief executive officer Bill Williams said yesterday. The company claims it will be able to produce an additional 4m pounds of its Moose Munch Confection brand as well as 3m pounds of chocolate enrobed fruit each year. In its third quarter, the company said the improvement in profit margin to 36.7 per cent from 23.4 per cent in the same period last year was partly due to reduced delivery costs. Harry & David said a result of the expansion would be to meet rising customer demand. The Ohio factory was completed in September 2007, including a 275,000sq ft distribution centre for mail order. Completion on the new expansion is expected by fall of 2008 and will provide another 160 full-time jobs, the company said. Sales for the third quarter up to March 31 were $98.2m, a 3.8 per cent increase on the same period the previous year. Harry & David said this was "primarily driven by increases in the company's direct marketing segment and wholesale sales of Jackson & Perkins and Harry & David products".