Healthy snack division slows Zetar profits

By Charlotte Eyre

- Last updated on GMT

Related tags London stock exchange

UK-based confectionery and snack firm Zetar today said that
pretax profit fell to £1.09m for the half year from £1.3m
in the previous year, as losses incurred by the recently
established Baked Snacks group offset improved sales.

Zetar's Baked Snacks company was created in May last year to acquire the assets of Britannia Biscuits, a manufacturer of low fat, low sugar, low salt - and therefore healthier - biscuits and crisps. The company today said it has been unable to complete the commissioning of the factory, with the Baked Snacks division experiencing operating losses of £0.4m during the six months ending 31 October 2007 as a result. Nevertheless, chief executive Ian Blackburn said he was satisfied with the company's overall results, as total operating profit for the period increased £2m, up from £1.9m the year before. Turnover was posted at £48m, a 26 per cent increase compared to £38.2 per cent in 2006 "We are pleased that despite the challenging market conditions, and excluding Baked Snacks' initial losses, the Group has maintained its record of successful year-on-year progress,"​ he said. Profits for the period were also boosted by more successful results from the confectionery division, which experienced a sales increase of 14 per cent, and an operating profit increase of 23 per cent. The company attributed its confectionery growth principally to the success of chocolate and yoghurt covered fruit and nut products. Overall, margins decreased only slightly by 0.7 percentage points, down to 4.2 per cent. Zetar first listed on the UK Alternative Investment Market (AIM), otherwise known as the London Stock Exchange's market for smaller companies, in 2005, with the objective of focusing on healthier snack and confectionery products. Recent acquisitions include Ireland-based Lir, a manufacturer of luxury chocolates, in December 2007, and the fruit and nut firms Humdinger and Readifoods in 2006. Looking forward, the company said it plans to continue focusing on these niche areas. "We are confident that strong foundations have been established across the group on which the board can continue to pursue its organic and acquisitive growth strategy,"​ Blackburn said.

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