Soaring costs take 12% bite out of profits at owner of Mr Kipling
Mr Kipling cakes firm Premier Foods has served up falling full-year profits as the company battles soaring costs.
The group said adjusted pre-tax profit fell 11.8% to £74.2m in the year to April 1, down from £84.2m in 2016.
Underlying revenue fell 1.4% to £790.4m in the period, with chief executive Gavin Darby flagging a "challenging year" as he updated the group's strategy.
He said: "This financial year has been a challenging one for the industry, with the return of food inflation and changing retailer promotional strategies.
"With the industry changing rapidly, we have updated our strategy to give an equal focus to revenue growth, cost efficiencies and cash generation.
"In the UK, growing ahead of our categories continues to be a core objective for us and our plans for international are for further strong growth."
The group, which also owns a raft of household brands including Oxo and Batchelors, has been stung with surging costs of commodities such as sugar, chocolate, dairy, wheat and palm oil, as well as the collapse in the pound.
In January, the firm warned that annual profits would be around 10% lower than expected and unveiled a "substantial" cost-cutting plan weeks after confirming it was in talks with supermarket giants and retailers over price hikes.
Premier said it would take a "blended approach" to managing cost increases, including looking at "limited price increases where these cannot be avoided".
Plans to slash costs throughout its supply chain are expected to yield £20m over the next two years, the firm explained.
Mr Darby added: "We are excited by our global strategic relationships with Cadbury and Nissin, and our recently announced cost savings programme is expected to deliver £20m over the next two years.
"We are focused on reducing our leverage ratio through profit improvement and debt reduction."
Shares were up 1.16% to 43.5p.