Profits at Walkers Shortbread were hit by supermarket price wars last year, according to the company.
The Moray-based producer of shortbread, biscuits, cakes and oatcakes reported a 2.7% rise in turnover, to £140.8m.
But accounts filed with Companies House showed pre-tax profit fell from almost £14.5m in 2013, to just over £10.9m.
Walkers in part blamed downward pressure on prices as a result of major UK retailers fighting to maintain their market share.
It also cited a lack of economic growth in continental Europe and adverse currency movements for a reduction in operating margin, which fell from 9.7% to 7.4%.
Exports accounted for 42% of sales in 2014.
Aberlour-based Walkers said it expected the battle by major retailers to maintain market share to "limit the extent to which our margins will ultimately recover".
It added: "Given the nature of the cost and economic pressures we continue to face, it is likely that our margins will remain close to their current levels for some time."
Walkers also reported that during the manufacturing peak in the run-up to the Christmas trading season, it employed more than 1,700 people - a record for the company.