Frozen food retailer Iceland says its ill-fated foray into organic foods cost it £20.3 million sterling.
The share price of the company, which is changing its name to The Big Food Group, halved at the start of this year after it issued a series of profit warnings. Sales plummeted following a switch to higher-priced organic produce.
There were also delays in the integration of cash-and-carry firm Booker, with which it merged last year.
The company says the poor performance at its Iceland Foods stores had been a "major contributor" to its under-performance in the 15 months to March 31st.
But chief executive Mr Bill Grimsey said the fall in like-for-like sales - stripping out the effect of new store openings and closures - has been stemmed.
Like-for-like sales at Iceland Foods stores for the 24 weeks to September 15th were down 1.9 per cent on the same period last year, but they were down only 0.5 per cent for the last 17 weeks of this period.
Sales have improved further since then - showing a 0.1 per cent rise in the nine weeks to November 17th.
Iceland today reported interim pre-tax profits of £16.7 million sterling and that it will be known by its new name from now on. Sales over the six-month period amounted to £2.45 billion, up from first-half sales of £852.3 million last year.
PA
