Northern Foods posts flat annual profits

Chief Executive Stefan Barden said the firm aimed to replicate the success it achieved with the relaunch of its Fox's biscuits, which lifted it to number two in Britain's biscuit market behind privately owned United Biscuits.

"We have high hopes for this," he said of the pizza revamp, which includes new recipes and an advertising campaign featuring the "pizza fairy."

"We've got more retailer space on the back of the launch and we know the adverts are going down well," Mr Barden said, adding that pizza sales could also get a lift from the soccer World Cup, which starts this month.

Leeds-based Northern Foods, which also makes own-label products for retailers as diverse as premium food seller Marks & Spencer and discounter Aldi, posted profit before tax and one-off items of 39.2m for the 53 weeks ended April 3, little changed from the year before.

Sales were broadly steady as well at 977m as demand for salads, sandwiches and bakery products offset the planned exit from low-margin frozen foods business.

"Northern Foods has traded solidly in challenging market conditions. We expect these conditions to continue, but we remain well positioned for the future," Mr Barden said.

The group, which is Britain's biggest seller of Christmas puddings and supplies food to British Airways, kept its full-year dividend at 4.5 pence a share.

Some analysts have said Northern Foods might cut its dividend if it needs to inject more cash into its pension scheme following a triennial valuation in March 2011.

However, finance director Simon Herrick said this was not necessarily the case and that there were currently no plans to cut the payout to shareholders.

Shares in Northern Foods, which said in April it was closing a ready meals factory in Wales after failing to agree terms with a key customer, have underperformed the UK food producers' index by about 27 per cent this year.