Patties Foods' profit drops 16.5 per cent
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SYDNEY, Feb 25 AAP
February 25 2013, 11:52AM
Pie maker Patties Foods has posted a 16.5 per cent fall in first half profits as its margins are impacted by increased competition.
The company, which owns Herbert Adams, Four'n Twenty and Nanna's, made a net profit of $9.1 million in the six months to December 31, down from $10.8 million in the previous corresponding period.
Patties Foods had forecasted the fall in profit at its annual general meeting in December.
Sales revenue for the half was up 5.1 per cent to $125.5 million.
Company chairman Chris Riordan said that while overall revenue was up, margins were impacted by increased competition, particularly for its supermarket products.
He also said manufacturing performance was down due to the installation of its new robotic packing equipment.
"This half year result reflects the challenging trading conditions, particularly in the In Home channel," he said in a statement.
"Our response must continue to be a relentless focus on supporting and enhancing our brands, developing new channels and regions, and improving our manufacturing and supply chain efficiencies as part of an overall ongoing review of our cost structure."
The company maintained its market share across all its categories and had strong revenue growth in its petrol station and convenience store division.
Patties said it was continuing to invest in the development of brands through new products and promotions.
It said its investment in developing new ways to sell its products was expected to show results in the next two to three years.
Patties will pay its shareholders a fully-franked interim dividend of 3.2 cents per share on April 12.