Fierce competition and overcapacity hit Snackhouse, the crisps and snacks manufacturer formerly known as Bensons Crisps.

The potato crisp market has been under fire from more varied snack foods, and as a result the company's market share dropped to 6.5 per cent from 6.7 per cent.

As a result of stale prices and soggy market volumes, Snackhouse saw its revenues from potato crisps fall by ten per cent to £11.5 million compared with £12.8 million in the same period last year.

Despite this, the company enjoyed an overall increase in profits, helped by the successful integration of last year's acquisitions - Country Harvest and K Snack Foods.

Profits before tax for the six months to May 31 were £1 million compared with £1.5 million last year.

Last year's figure included a one-off exceptional profit of £617,000 from the sale of a factory.

Turnover was £26.4 million against £20.8 million.

Chairman Sid Taylor said: "Our strategy of broadening our range of snack foods has enabled us to increase sales and create a more balanced mix of business."

Shareholders will get an interim dividend of 0.7p.