But while operating profit was reduced by 30 per cent on the previous year's quarter, improved operating costs have almost trebled operating profits for the full year to $23.5 million.

"We are pleased with the results for fiscal 2004, particularly in light of continuing challenges in the sugar and energy markets," said president and chief executive Robert Peiser.

"Lower raw material costs, reduced selling and administrative expenses and more efficient factory operations overcame lower sales volumes and prices and significantly higher energy prices."

The sugar processor attributed the sales decline to "soft demand, competitive pressures, and the company's decision not to pursue some low margin sales in an oversupplied domestic sugar market".

Imperial Sugar said it expects to continue to see lower prices in fiscal 2005 as domestic sugar consumption is low while supply is high. But it said it is well-positioned to execute its strategy of a more value-added approach with more innovative products and services for customers.

The company also initiated its first quarterly cash dividend since 1999 based on confidence in its strategy, despite expected market trends.