Greencore has reported a fall in pre-tax profits to €41.7 million for the year ending September 26th, down from €59 million the previous year.
Part of the reason for the profit fall was the absence of a one-off compensation gain of €48.2 million last year mainly due to a European Union payment for exiting the sugar industry.
Revenues rose 3.2 per cent to €1.3 billion, an increase of 13 per cent once currency fluctuations were stripped out.
The company said its results were delivered in the context of an 11.6 per cent depreciation in the exchange rate between the euro and sterling to €0.764 compared with an average of €0.675 in 2007, resulting in a currency impact of €8.1 million.
In addition to the currency impact Greencore said it faced significant rise in input costs and a consumer price slowdown in the second half of the year.
"The consumer environment in the near term is likely to remain challenging," the company said in the statement. Greencore raised prices this year to recoup higher food costs.
"In particular, in our core convenience foods market in the UK the general economic outlook is poor.''
The group's water division reported an operating loss of €4 million due to a "deliberate concealment of costs" at the division by the former financial controller, who has since left the company.
In July and August Greencore and KPMG reviewed the balance sheet and financial control review of the group and "no additional issues were identified but salutary lessons have been learned".
Greencore, formerly called Irish Sugar, shut its last sugar factory in 2006 to concentrate on convenience foods and ingredients. Convenience-food sales at the unit rose 7.4 per cent to €894 million during the year at constant currencies, Greencore said.
Greencore finance director Geoff Doherty said the company had benefited from a switch by consumers switched to own-label products from branded goods.
The company expects about a fifth of convenience food sales to come from outside the UK and Ireland by this time next year, up from 13 per cent currently, he said.
A final dividend of 8.21 pence per share will be paid, giving a total payout for the year of 13.51 cents, up 1.9 per cent on 2007.
At 11.15am in Dublin Greencore shares were marginally lower at €1.08, giving the company a market cap of €218 million. The group's sales have fallen 75 per cent this year.
Bloomberg