Real Good Food's deal to sell Brighter Foods to THG in a move that generated £36.4m for the Liverpool company failed to stop its losses from widening during its latest financial year.
The food manufacturing business, which specialises in cake decoration, has reported pre-tax losses of £18.9m for the 12 months to March 31, 2022, compared to losses of £6.1m in the prior year.
The listed company also confirmed that its revenue increased from £37.2m to £40.4m over the same period.
READ MORE: Click here to sign up to the BusinessLive North West newsletter
The figures come after the company warned more jobs are at risk of being cut as part of "radical reforms" to "eliminate overhead costs".
The business added the move will also "build stronger partnerships with key customers".
In a statement to the London Stock Exchange, Real Good Food said "unprecedented increases in the cost of raw materials and energy in recent months continue unabated and pose significant challenges".
It added that in response, it has "hunkered down, controlled costs and protected revenues where possible".
The company also said that its current financial year is "expected to be a very challenging and loss-making" but that it is being "strengthened to be more resilient and ready to benefit from a more favourable trading environment".
Executive chairman Mike Holt said: "The group made a good start to the year and expected to build on this during the seasonally busier second half of the year.
"Market conditions changed during Q3 and have remained extremely challenging as noted in our trading updates in April and earlier today. To mitigate this, we are putting into effect a more radical programme of reform to reduce costs, protect revenues and preserve the inherent value of the group.
"This involves the refinancing of the group and discussions are underway with potential lenders."
READ NEXT:
