Finsbury Food Group has reported strong sales following its purchases of Memory Lane Cakes in August 2002 and bread and cake maker Nicholas & Harris in February 2003.

The company said the acquisitions should be fully integrated before Christmas. It added that despite pricing pressure from the multiples, market over-capacity and high ingredient prices, strong demand had sustained product performance. Consequently, it planned to keep acquiring niche bakery businesses and diversify in the long term.

Memory Lane Cakes MD Phil Batchelor said its deal to manufacture under Nestlé’s confectionery brands this month was “a good platform for expanding into convenience”.

The group reported pre-tax profit of £390,000 on sales of £35.3m in the year to June 30, its first year of trading.

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