Finsbury Food Group has boosted pre-tax profits by more than 8%, helping the cake supplier take a slice out of its net debt.
The manufacturer of cakes for Thorntons and Disney grew profits to £189.6m in the year to 2 July. That was despite the rising cost of butter, sugar and wheat squeezing margins from 4.8% to 4.5%.
“This growth, in difficult trading conditions, is a creditable performance, as is the cash generation, which for the second year came in stronger than expected,” said Panmure analyst Graham Jones.
The performance helped Finsbury reduce its net debt from £42.6m to £37.1m, £1.5m ahead of forecasts from Panmure.
Despite beating market expectations over the past year, Finsbury said it remained cautious in its outlook.
“The reality is that testing times still lie in wait,” said chief executive John Duffy. “However, our distinctive range of products, commitment to value and robust performance in a testing climate bode well for the challenge ahead.”
Finsbury turns round slump in cake sales (26 July 2011)
Bread and free-from give Finsbury a lift (23 March 2011)