DALEPAK owner Northern Foods showed its renewed pricing power yesterday by revealing it was on course for better-thanexpected annual profits.

The group, which employs 300 people at its factory in Leeming Bar, North Yorkshire, said underlying revenues grew 3.2 per cent in the past year, with 2.4 per cent of that figure coming through pricing.

The boost comes on the back of a spell of poor results last year following bad weather which hit the summer barbecue season.

Sales in the company's chilled and frozen divisions were up 5.5 per cent and 2.8 per cent respectively, while the bakery section showed signs of recovery with underlying revenues up 1.1 per cent on a year earlier.

Northern Foods, a major supplier of products to Marks and Spencer, has sought to bolster its fortunes by ditching lower-margin business and refocusing on faster-growing markets.

And the company, which also makes Goodfella's pizzas and Fox's biscuits, said profits for the year to the end of this week were likely to be stronger than the City's consensus figure of £47.5m.

Chief executive Stefan Barden, who took the helm in February last year, said the company remained on the right track.

We are operating in a volatile trading environment with inflationary commodity prices," he said. "However, we are confident that we will continue to make steady progress in realising the full potential of the business.'' Last year, the company sold its speciality bread, chilled pastry, cakes and flour mill operations as it looked to focus on key brands as part of a drive to improve performance.