ARYZTA, the Irish-Swiss food company that owns the Cuisine de France and Delice de France brands, says high rents are damaging its sales by pushing shops out of business.

Formed two years ago through a merger between IAWS and Hiestand, Aryzta said revenue in Ireland and Britain in the year to the end of July plunged 20%.

"Many of our customers are still struggling with legacy high rents and cost structures, and this makes their business vulnerable," chief executive Owen Killian said on a conference call with analysts last week. "Our business is completely dependent upon product availability. This does require a commitment to investment in in-store labour and a consumer-facing proposition because if the product isn't available, then the consumer will not be in a position to support it. And we are working very hard to support our customers to reposition a value proposition and to position their businesses so that they can compete in this much more difficult environment."

Though Ireland and Britain no longer make up the bulk of sales at Aryzta's food division, the decline has had an impact on its results. Profits at its European food business dropped 3% to €131m. "We've seen consumer slowdown in most markets and this impacts revenues naturally, because there is less cash being spent by consumers. And unemployment, particularly among under 25-year-olds, remains stubbornly high across most markets. This had a severe impact on food service and convenience channels, particularly in Ireland and the UK," Killian added.

Overall, Aryzta's total pre-tax profits rose to €197m from €43m, though the 2009 figures were hit by writedowns on property. Revenues fell to €3bn from €3.2bn. These figures include the results from Origin Enterprises, the Dublin-based agri-business company in which it has a 70% stake.

Aryzta will pay shareholders a dividend of 36.6 cents per share. The dividend won't be paid until February next to allow investors take advantage of a change in Swiss law that means there is no tax paid on the dividend. It will also apply to Irish investors in the company.

On Friday, the company said it raised nearly €242m to pay for the takeover of a 50% stake in Maidstone Bakery.