RHM reported continued recovery in its Mr Kipling cakes brand on Tuesday, but said high wheat prices and marketing spend meant annual profit would be even more skewed to the second half than last year.

The firm, which had been hit hard by declining sales of Mr Kipling cakes, said turnover in the four months to August was about 2 percent higher versus the same period last year.

This included an unspecified rise in like for like sales and market share gains for Mr Kipling cakes, RHM said in a statement before its annual shareholder meeting.

But the firm also said turnover and profit margins at its culinary brands had been hit by a hot summer, as well as some retailer destocking and stiff competition.

For these reasons, as well as the impact of higher wheat prices, increased marketing spend and the timing of price increases, profit will be even more skewed to the second half than last year, it said.

RHM bakes about a third of Britain's bread including the Hovis and Mother's Pride brands.

For the year as a whole, the board remains confident that RHM will deliver further progress, it said.

RHM shares, which floated at 275 pence apiece in July 2005, closed at 284 pence on Monday, valuing the business at about 989 million pounds.

United kingdom