NORTHERN Foods yesterday posted a rise in revenues, but said that trading conditions remained challenging.

Underlying revenues in the company, which employs about 300 people at its Dalepak factory, in Leeming Bar, near Northallerton, North Yorkshire, grew 2.6 per cent in the 13 weeks to June 30, as stronger ready-meal sales offset a weaker performance in sandwiches and salads. The group, which owns the Goodfella's pizza and Fox's biscuit brands, said it continued to battle against rising commodity prices, but said that, while trading remained challenging, it was making progress with the business.

A trading update from Northern revealed that sales of frozen goods were up by 1.1 per cent, boosted by the performance for its Goodfella's range, while chilled goods sales, including ready meals, were up by 5.2 per cent.

The group, which is based in Leeds, said revenues stabilised in its key biscuits business following better-targeted promotions, but said that revenues across its bakery operation fell by 2.6 per cent in the period.