Associated British Foods lifts annual profit

Associated British Foods, owner of Primark and AB Sugar, boosted full year profit as it cautioned of a recent increase in commodity prices.

Pre-tax profit rose to £761m for the year ended September 15th from £757m a year earlier. Revenue for the year increased to £12.25bn from £11.07bn previously.

Chief Executive George Weston said: "These are very good results for the group and include exceptional performances from AB Sugar and Primark. Global economic uncertainty remains but we have opportunities for further investment and the strength of the group balance sheet and a strong cash flow will enable us to pursue them with confidence."

The group said it expects to make further progress in the next financial year despite the challenges of subdued economic growth and continued pressure on consumer disposable incomes.

"Global economic uncertainty looks set to remain a feature of the new financial year and in recent months we have seen an increase in some of our commodity costs, notably cereals," it added.

It expects a reduction in profit from AB Sugar, as a result of lower EU production, to be more than offset by further growth at Primark and some recovery in grocery.

"We therefore expect the group to make some further progress in this new financial year but, in contrast to last year, this will be weighted towards the first half," the group explained.

A final dividend of 20p has been recommended and together with the interim dividend of 8.5p, this brings the total payment to 28.5p for the year, an increase of 15%.

CJ