2 Sisters Food Group said sales of ready meals continue to struggle after the scandal erupted in January - even though no traces of horsemeat have been found in its products.
The Birmingham-based company, one of the UK's biggest food producers, saw underlying operating profits fall £11.1 million to £20.3 million in the 13 weeks to the end of April. Profits were also eroded by rising costs, the tough consumer climate, the exceptionally cold spring and the acquisition of loss-making operations from Dutch food group VION.
But 2 Sisters, which is also one of the UK's biggest poultry suppliers, said like-for-like sales increased 4.5% to £624.6 million as it continues to win business with major retailers in its meat arm.
The company, owned by entrepreneur Ranjit Singh Boparan, said it expects the market to remain tough as inflation continues to squeeze consumers' spending power and shoppers shun ready meals.
The company has been on a debt-funded buying spree in recent years, acquiring Yorkshire-based Goodfella's pizza-maker Northern Foods for £342 million in 2011.
In March it also bought the poultry, beef and lamb processing operations of Dutch food group VION after it decided to quit the UK. The deal, for an undisclosed value, has been cleared by the Office of Fair Trading.
2 Sisters acquired a £1 billion turnover business with 5,500 staff and factories in Perthshire, Glasgow, Aberdeenshire, Anglesey, Flintshire, Essex, Suffolk and Cornwall.