Sugar Puffs parent Raisio saw its UK cereals and snacks business return to profit as it prepares a major relaunch of the division’s biggest selling UK product line.

CEO Matti Rihko said sales volume in Honey Monster Puffs cereals had levelled off in the quarter to the end of September after experiencing a decline earlier in the year.

“We are now on the right track but there is still much work to be done to achieve profitability levels and sales consistent with our objectives.”

Last month Raisio announced that Sugar Puffs will be rebranded as Honey Monster Puffs “later this year”, with the cereal containing less sugar and more honey.

Rihko’s comments came as the wider Raisio group announced net sales of €126.9m (£99.3m) between July and September, down 15.1% from €149.5m for the same period in 2013. EBIT edged up from €12m to €12.1m over the same period, which represented a €3.6m rise from the previous quarter.

Earnings for Raisio’s consumer and licensed brands held steady in value terms at €10.8m, but accounted for 14.2% of net sales, down from 14.8% last year.

Rihko said: “This is a good performance in challenging market conditions given that our businesses are not in identical situations.”

Raisio said consumer demand for confectionery remained stable in the UK. Demand for soft gums continued to grow. However, tight price competition in the UK confectionery market continued, it warned, as did consumer interest in smaller, less expensive purchases.

UK sales of Raisio’s own-brand confectionery products rose 10% in the UK as a result of promotional activity and new productions and gift boxes.

Sales also increased in licenced confectionery brands. Raisio estimated EBIT for the full year to remain below the level of 2013.

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