HIGHLIGHTS

·      Sales up 9% to £9.6m (2009: £8.9m)

·      43% increase in pre-tax profits to £562k (2009: £394k)

·      Gross Profit up 14% to £3.2m (2009: £2.8m)

·      46% increase in Earnings per Share to 17.2p (2009: 11.8p)

Group Sales for the first six months of 2010 exceeded last year’s figures by £764,994, increasing from £8,851,767 to £9,616,761.  Profit before tax for the six-month period of this year was £561,782 against last year’s figure of £393,831. Basic Earnings per share also increased from 11.8p to 17.2p in the corresponding period.

Clive Miquel, Chief Executive commented, “We are very pleased with the results for the first half of the year and they demonstrate that the strategy we have implemented is being rewarded with increased sales and profits.

“Sales have benefited from the general uplift within the major multiples in the food sector across the Lees’ product range and we have increased our market penetration in the area of food service.

“Increased focus on production planning has also helped generate greater efficiencies and cost savings and we are continuing to assess how we can improve production capabilities at both sites. Items such as the new meringue depositor installed last year are now delivering benefits and represent a positive return on investment.

“Promotional investment has also increased with the additional expenditure being offset through higher sales. The business continues to be strongly cash generative and we have had an excellent cashflow performance over the last 12 months.

“Looking ahead to the full year performance, despite raw material costs remaining uncertain, we expect both sales and pre-tax profits to be in line with market forecasts. The full impact of commodity costs increases into 2011 is not yet clear, but we will continue to focus on improving efficiency to mitigate against potential cost pressures as well as looking to develop new opportunities with both existing and new customers through new product development which remains core to the company’s growth strategy.

The directors will also consider potential acquisition opportunities to generate additional revenue streams if these are the right fit for the business.”