Finsbury celebration cake

Finsbuiry Foods has recommended an increased dividend for shareholders

Finsbury Foods has said profit expectations for the year are significantly ahead of expectations.

The maker of cakes and speciality breads today recommended an increased final dividend of 0.5p, giving a total dividend payment of 0.75p for the year and said that total debt is lower than expected at below £10m, compared with £34m a year ago.

The baker said the sale of its Free From division for £21m in February helped transform its balance sheet, as well as providing a boost in sales in the two months before the sale was completed.

“I am pleased to announce that the hard work and improvements made in the business have allowed us to recommend an increased dividend for our shareholders,” said CEO John Duffy. “The board believes that this, combined with the driving down of debt, increased profit expectations and continued growth, is further ensuring shareholder value.

“The sale of Free From has proven hugely beneficial for the Group, allowing further investment and laying the foundation for continued growth. The Board is committed to continuing the successes of the past year, and I am confident that our improvements will assure shareholders and consumers alike of the Company’s fortitude and resilience in what continue to be adverse trading conditions,” added Duffy.

In March, the group reported a 32.8% rise in pre-tax profits to £3m for the last six months of 2012.