Growing sales in the Middle East helped Macphie of Glenbervie increase turnover by 3..5% to £44.4million in the year to the end of March.
Strengthening economies in that part of the world boosted business, the family-owned and run food ingredient firm said yesterday.
The company also reported stronger trading for its foodservice and manufacturing “channels”, thanks to a gradual improvement in consumer confidence.
But Macphie, which is headquartered on the family’s 2,000-acre Glenbervie Estate near Stonehaven, said European markets remained challenging “against a backdrop of austerity measures”.
The firm’s latest accounts – just lodged at Companies House – show pre-tax profits fell by more than 9% during the period, to around £1.9million, from £2.1million previously.
Macphie said volatile raw material prices, particularly in the dairy sector, were the biggest factor in a fall in profit margins.
The company’s efforts to bring its research and development tax credits up to date as well as capital allowances for investment in new plant created a positive tax figure in the latest accounts.
Macphie highlighted an “overall positive profit position” of £2million for 2013/14.
Chairman Alastair Macphie said: “The current economic climate will continue to be a challenge both in the UK and internationally, however, we are pleased to see some positive early signs of recovery.
“Looking forward, we will continue our significant operational capital investment programme and award-winning employee development initiatives to ensure we remain the vital ingredient for our international customer base.”
Macphie’s workforce grew to a total of 253 people during the latest accounting period, from 248 a year earlier.
The company makes ingredients used by bakers, pubs, restaurants, hotels, ready-made food firms and caterers throughout the UK.
It was founded as a wholesale business by Alister Macphie, the current chairman’s great uncle, in Glasgow, in the 1920s.
The firm moved into manufacturing in the 1970s and its headquarters were relocated to Glenbervie, where the Macphie family had been farming for more than 700 years, in 1973.