Finsbury Food Group: revenue drops on cake sales

London / UK. (ffg) This week Finsbury Food Group PLC, a leading manufacturer of cake, bread and morning goods, held its Annual General Meeting. At the meeting the Chairman issued the following update on trading for the first 17 weeks of the current financial year ending 30 June 2010:

The Bread and Free From businesses have continued to achieve double digit growth year on year. The Goswell acquisition made at the end of the last financial year has increased sales by eleven percent. On a like for like basis, excluding Goswell, revenue has increased by eight percent.

However, sales in the larger Cake business have declined by six percent in value, slightly ahead of the overall cake market which has declined by nearly four percent over the last twelve weeks. In addition to increased promotional investment, Finsbury has exited some low margin products as the Group has integrated its cake businesses.

As a result, revenue for the Group has fallen year on year with sales for the 17 weeks to the end of October two percent behind the corresponding period last year, four percent behind on a like for like basis excluding Goswell.

The integration of the businesses has widely improved the Group´s efficiency, product quality, and customer service and as a result, Finsbury remains a strong player in its market place and enjoys a loyal and diversified customer base. The company will continue to adjust to market and customer demand by utilising the highly skilled, innovative and flexible production capability. The strong management teams will continue to optimise the Group´s strengths throughout this challenging period.

Adding to this, John Duffy, Chief Executive of Finsbury, commented: «Consumer behaviour is still being affected by the recession and premium range sales have been impacted in the short term. The economic environment remains challenging and uncertainty around input price inflation remains high. We continue to focus on integrating our businesses to improve efficiency and operating margins whilst gaining an improved understanding of our consumers».