Bakery and ingredients specialist Real Good Food (LON:RGD) says the business is in 'good shape' and that it's upbeat on the future following the sale of its sugar division, which was affecting performance.
The £34mln funds from the sale of Napier Brown were received in May and mean the group can now fast track some of its investment opportunities, including possible acquisitions.
The continuing group has a positive cash balance, is cash generative and profitable, said Real Good Food, posting full year results to end March - seven weeks before the Napier sale to Tereos Group, a French maker of sugar cane and cereals.
The full year numbers were affected by the market issues in sugar, which hit both UK sugar distributor Napier Brown and Garrett Ingredients.
The problems for Napier have been well documented as European sugar prices were forced lower by increased competition as other firms sought to establish new market positions ahead of the removal of EU sugar quotas in 2017.
The sale process took many months but ultimately the price demonstrated the strength of the business, which had been built with its strong UK route to market, retail packing facilities at Normanton and the investment in the new Sugar Hub import facility at Stallingborough, Real Good Food said.
Underlying earnings (EBITDA) fell to £1.9mln in the year to March 31, compared to £3.3mln the year before, driven by the Napier Brown performance where a loss of £3.4 million was incurred, a deterioration of £1.8mln compared to the previous year.
Group revenue from continuing operations for the 12 months was £104.6mln - 5.1% lower than the previous year, mainly driven by the fall in commodity prices within Garrett Ingredients.
The year, however, saw a number of positives, including the successful integration of cake decoration business Rainbow Dust Colours - an attractive added value market both in the UK and for exports - continued strong profitability at Renshaw, and a turnaround at Haydens Bakery.
Executive chairman Pieter Totté told investors: "Importantly, the group, excluding Napier Brown, grew its operating profit from £2.7 million to £3.2 million.
"Net debt was well controlled at £30 million at the balance sheet date and following the sale of Napier Brown, the business now has significant positive net cash balances.
He added: "Trading in the early months of the new financial year within our continuing businesses has begun well and with the funds from the sale of Napier Brown being received in May we are now in a position to fast-track some of the investment opportunities.
"This will include spend on jam, sauce and pie-filling capability at R&W Scott; infrastructure at Haydens to support its growth; and increased capacity at the Renshaw site in Liverpool.
"We will also look at potential bolt-on acquisitions which will help build our presence in our chosen markets, but only where there is a sensible financial and operational investment case.
"Overall, the business is in good shape and we look forward with great optimism."
The firm now focuses on three main markets - cake decoration through Renshaw and Rainbow Dust Colours, food ingredients, via Garrett Ingredients and R&W Scott and premium bakery, via Haydens.
Shares eased on Friday 0.96% to 51.5p.