United Biscuits had a torrid start to 2010 missing its sales and profits targets and losing market share, a leaked company announcement has revealed.

In a statement from UB managing director Benoit Testard shown to The Grocer the snacks giant admitted it had been £10.5m down on its sales budget and £4.5m adrift of its profits target in the first three months of the year.

Although sales were 4% up in value and 6% by volume on 2009, Testard said this had been "offset by lower pricing, particularly in branded biscuits". The gains it had made on favourable PPV (Purchase Price Variance) had been "somewhat offset by other things such as unexpected logistics costs and overheads", he added.

Testard expressed concern that the core snacking market had grown 7.8% in period three (28 February to 27 March), but UB "did not quite keep up with this growth, with 5.7%". As a result of this UBUK had lost 0.2 share points.

Biscuits had performed well, with sales rising 9.1% to give UB a 25% share of the market, up from 23.1%. But its more modest 1.8% growth in snack sales had shrunk its share of that market 0.1 points to 15.8%.

Testard described the performances as "mixed". He cited strong growth figures for Go Ahead!, Penguin and Jacob's Crackers, but falling sales for Cheddars and Hobnobs. In snacks, McCoy's "in particular showed good growth, though tortillas continue to fall", he said.

It was encouraging that the core snacking market had started to grow fairly strongly again, he continued. "However it is vital we do not miss out on this we must make sure we continue to grow share in both snacks and biscuits and not let our competitors take advantage of a growing market. On top of this we must continue with our main focus, which is to catch up with our budget targets as soon as we possibly can."

A UB spokeswoman described the targets as ambitious and said the numbers were "old news". She also maintained the company was performing well.

"External data for the year to date shows that we have seen strong growth in our market share in both biscuits and snacks. Indeed, our share of the biscuits market is now 1.1% ahead of last year, with 25.5% of the market," she said. "We also have a 16.5% share of the snacks market up 0.4% on last year. UB will continue to build on the momentum generated and has a strong plan for the second half of the year."